An auditor, having accounted for a sequence of inventory tags, traces information on a representative number of tags to the physical inventory sheets.The purpose of this procedure is to obtain assurance that:
A)inventory sheets do not include untagged inventory items.
B)the final inventory is valued at cost.
C)the inventory listed on the inventory sheets is complete.
D)all inventory represented by an inventory tag is bona fide.

Question

Quizplus · Accepted Answer

The purpose of tracing information from a representative number of tags to physical inventory sheets is to ensure that the inventory listed on the inventory sheets is complete. This procedure helps to ensure that all items that should be included in the inventory are actually listed on the inventory sheets. Option A is not the purpose of this procedure, as it is concerned with untagged inventory items, which are not relevant to the procedure. Option B is related to the valuation of the inventory, which is not the focus of this procedure. Option D is also not the purpose of this procedure, as it is concerned with the authenticity of the inventory items, which is not relevant to the procedure.

An Auditor, Having Accounted for a Sequence of Inventory Tags