Purchase cutoff procedures should be designed to produce evidence about whether or not merchandise that is included in the inventory of the company ________.
A)has been paid for
B)is physically present in the warehouse
C)is owned by the company (legal title has been transferred)
D)relates to the shipping documents for the merchandise issued in the company's name

Question

Quizplus · Accepted Answer

Purchase cutoff procedures should be designed to produce evidence about whether or not merchandise that is included in the inventory of the company is owned by the company (legal title has been transferred). The other options are also important to verify, but ownership is the most critical factor in determining the accuracy of the inventory balance.

Purchase Cutoff Procedures Should Be Designed to Produce Evidence About