During the preliminary analytical review,the auditor discovered that the auditee forecast sales of 10,000 units but only 5,000 were sold.The auditors should consider performing a careful lower-of-cost-or-net realizable value analysis of the year-end inventory.

Question

Quizplus · Accepted Answer

The discrepancy between the auditee's sales forecast and actual sales could indicate potential obsolescence or damage to the inventory, which would require a lower-of-cost-or-net realizable value analysis to determine the appropriate valuation of the inventory.

During the Preliminary Analytical Review,the Auditor Discovered That the Auditee