With Respect to a Small Company's System of Purchasing Supplies

question 68

Multiple Choice

With respect to a small company's system of purchasing supplies, an auditor's primary concern should be to obtain satisfaction that supplies ordered and paid for have been:

• A) requested by and approved by authorized individuals who have no incompatible duties.
• B) used in the course of business and solely for business purposes during the year under audit.
• C) received, counted, and checked to quantities and amounts on purchase orders and invoices.
• D) properly recorded as assets and systematically amortized over the estimated useful life of the supplies.

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Definitions:

Simple Reflexes

Basic, involuntary responses to stimuli, such as the knee-jerk reflex, that are mediated by the spinal cord and brainstem.

Cognitive Structures

Mental frameworks or patterns that help individuals organize and interpret information.

Perceptual Abilities

The capacity to interpret, analyze, and give meaning to sensory information.

Concrete Operational

A stage in Piaget's theory of cognitive development where children gain the ability to think logically about concrete events and understand the concept of conservation.