You Are Auditing the Inventory Account and Are Concerned About

question 92

Multiple Choice

You are auditing the inventory account and are concerned about the possibility of an inventory overstatement. What is the best audit procedure to detect damaged inventory?

• A) observe the condition of inventory during the client's physical count
• B) compare the condition of inventory from the previous year's count to the current year
• C) compare inventory turnover from the previous year's inventory to the current year's inventory
• D) reconcile the inventory counts to the cost accounting records

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Definitions:

Sentinel Event

A significant, unexpected occurrence involving death or serious physical or psychological injury in healthcare, triggering immediate investigation and response.

Psychological Injury

Emotional or mental harm caused by events or behaviors that negatively impact an individual's psychological well-being.

Medicare and Medicaid

Two different programs in the United States where Medicare is a federal health insurance program for people who are 65 or older, and Medicaid is a state and federal program that offers health coverage to individuals with a very low income.

Contaminated Area

A place where the presence of dangerous substances, biological agents, or conditions may pose a risk to health and safety.