Purchase cutoff procedures should be designed to test whether all inventory:
A)Owned by the company was recorded.
B)On the year-end balance sheet was carried at lower-of-cost-or-market.
C)On the year-end balance sheet was paid for by the company.
D)Owned by the company is in the possession of the company.

Question

Quizplus · Accepted Answer

Purchase cutoff procedures aim to ensure that all inventory owned by the company as of the balance sheet date is recorded, regardless of whether it is physically present or in transit. This ensures the accuracy of the inventory and cost of goods sold figures.

Purchase Cutoff Procedures Should Be Designed to Test Whether All