Auditing And Assurance Services
17th Edition
ISBN: 9780134897431
Author: ARENS, Alvin A.
Publisher: PEARSON
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Chapter 18, Problem 15DQP
To determine
Explain the differences between FOB destination and FOB origin. Explain the procedures that auditor must follow towards new acquisitions of the inventory on the FOB origin basis in the year end.
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what work will an auditor carry out prior to the commencement of the inventory count.
When auditing merchandise inventory at year-end, the auditor performs audit proceduresto obtain evidence that no goods held on consignment are included in the client’s ending inventory balance. This audit procedure provides assurance about which managementassertion?a. Completeness.b. Existence.c. Valuation and allocation.d. Rights and obligations.e. Occurrence.
When auditing merchandise inventory at year-end, the auditor performs audit procedures toensure that all goods purchased before year-end are received before the physical inventorycount. This audit procedure provides assurance about which management assertion?a. Cutoff.b. Existence.c. Valuation and allocation.d. Rights and obligations.e. Occurrence.
Chapter 18 Solutions
Auditing And Assurance Services
Ch. 18 - List five asset accounts, three liability...Ch. 18 - Prob. 2DQPCh. 18 - Prob. 3DQPCh. 18 - Prob. 4DQPCh. 18 - Prob. 5DQPCh. 18 - Prob. 6DQPCh. 18 - Prob. 7DQPCh. 18 - Prob. 8DQPCh. 18 - Prob. 9DQPCh. 18 - Prob. 10DQP
Ch. 18 - Prob. 11DQPCh. 18 - Prob. 13DQPCh. 18 - Prob. 14DQPCh. 18 - Prob. 15DQPCh. 18 - Prob. 16.1MCQCh. 18 - Prob. 16.2MCQCh. 18 - Prob. 16.3MCQCh. 18 - Prob. 17.1MCQCh. 18 - Prob. 17.2MCQCh. 18 - Prob. 17.3MCQCh. 18 - Prob. 18.1MCQCh. 18 - Prob. 18.2MCQCh. 18 - Prob. 18.3MCQCh. 18 - Prob. 19DQPCh. 18 - Prob. 20DQPCh. 18 - Prob. 21DQPCh. 18 - Prob. 22DQPCh. 18 - The following misstatements are included in the...Ch. 18 - Prob. 24DQPCh. 18 - Prob. 25DQPCh. 18 - Prob. 26DQPCh. 18 - Prob. 27DQPCh. 18 - Prob. 28DQPCh. 18 - Prob. 30C
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- When auditing merchandise inventory at year-end, the auditor performs audit procedures to obtain evidence that no goods held on consignment are included in the client’s ending inventory balance. This audit procedure provides assurance about which management assertion Select one: a. Existence b. Valuation and allocation c. Completeness d. Occurrence e. Rights and obligationsarrow_forwardWhich of the following audit procedures is the best test of the accuracy, valuation and allocation assertion for inventory? Select one: a. Obtaining the last receiving record numbers for the period and checking that they were taken up correctly b. Confirming stock held on consignment c. Comparing standard costs to actual sales prices. d. Attending the annual stocktakearrow_forwardWhen verifying debits to the perpetual inventory records of a nonmanufacturing company, auditors would be most interested in examining a sample of purchasea. Approvals.b. Requisitions.c. Invoices.d. Orders.arrow_forward
- Which of the following financial statements would be impacted by a current-year ending inventory error, when using a periodic inventory updating system? A. balance sheet B. income statement C. neither statement D. both statementsarrow_forwardWhich of the following audit procedures probably would provide the most reliable evidence related to the entity’s assertion of rights and obligations for the inventory account?a. Trace test counts noted during physical count to the summarization of quantities.b. Inspect agreements for evidence of inventory held on consignment.c. Select the last few shipping advices used before the physical count and determine whether the shipments were recorded as sales.d. Inspect the open purchase order file for significant commitments to consider for disclosure.arrow_forwardthe auditor picks an item of inventory from the warehouse and determines whether it is included in the entity's list of inventories a. existence b. completeness c. accuracy d. rightsarrow_forward
- An audit trail allows you to trace a source document to its final effect on the financial statements or vice versa.Describes what the audit trail would be for an inventory purchase.arrow_forwardThe auditor computed inventory turnover and compared it to prior years. This substantive test provides evidence regarding the client's Rights to the inventory. Question 1 options: True Falsearrow_forwardA typical substantive procedure for inventory balance and purchase transactions may include determining whether any inventories have been pledged and reviewing purchase commitment. Which of the following assertions is addressed by the audit procedure previously mentioned? * A. II, III and IV B. II and IV C. IV and VII D. IV, VI and VII E. II, IV, V and VIIarrow_forward
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