Procedures related to the purchases cut-off assertion should be designed to test whether or not all inventory:
A)purchased and received immediately before year-end was recorded in the correct period.
B)on the year-end statement of financial position was recorded at lower of cost or market.
C)on the year-end statement of financial position was paid for by the company.
D)owned by the company is in the possession of the company.

Question

Quizplus · Accepted Answer

The purchases cut-off assertion deals with ensuring that all inventory purchased and received before the year-end is recorded in the correct period. Therefore, the procedures should be designed to test whether or not all inventory purchased and received immediately before year-end was recorded in the correct period. Options B, C, and D are not directly related to the purchases cut-off assertion.

Procedures Related to the Purchases Cut-Off Assertion Should Be Designed