In connection with his audit of the financial statements of Knutson Products Co., an assembler of home appliances, for the year ended May 31, 1999, Ray Mendez is reviewing with Knutson's controller the plans for a physical inventory at the company warehouse on May 31, 1999.

Part A. Finished appliances, unassembled parts, and supplies are stored in the warehouse, which is attached to Knutson's assembly plant. The plant will operate during the count. On May 30, the warehouse will deliver to the plant the estimated quantities of unassembled parts and supplies required for May 31 production, but there may be emergency requisitions on May 31. During the count, the warehouse will continue to receive parts and supplies and to ship finished appliances. However, appliances completed on May 31 will be held in the plant until after the physical inventory.

Part B. Warehouse employees will join with Accounting Department employees in counting the inventory. The inventory takers will use a tag system.

Required: 

For Part A: What procedures should the company establish to assure that the inventory count includes all items that should be included and that nothing is counted twice? For Part B: What instructions should the company give to the inventory takers?