LO $12-6$

$12-30.$ Adapted AICPA Task$-$Based Simulation

During the year $1$ audit of Cellenting Co$.,$ the auditor performed various procedures

relating to inventory. Match each of the following procedures with the description below:

Audit procedures

$.$ Analytical procedure

$.$ External confirmation

$.$ Inquiry

$.$ Inspection of records or documents

$.$ Inspection of tangible assets

$.$ Observation

$.$ Recalculation

$.$ Reperformance

$($Each audit procedure may be used once, more than once, or not at all.$)$

Description of Audit Procedures Performed

a$.$ During the physical inventory count, the auditor asked the client to open various boxes of

inventory items so she was able to assess the quality of the item.

b$.$ During a site visit to a construction site, the auditor determined that all employees were wearing

proper safety equipment.

c$.$ The auditor asked the warehouse manager about whether certain inventory items were becoming

obsolete.

d$.$ The auditor obtained a purchase order from the purchase order file and compared it to the

authorized supplier list to determine that the related goods had been purchased from an

approved supplier.

e$.$ The auditor calculated the accounts receivable turnover for the year.

f$.$ The auditor obtained a copy of the company's accounting manual and read the section on

inventory to prepare for the physical inventory observation.

g$.$ The auditing firm's computer$-$assisted audit specialist obtained an electronic inventory file from the

company and checked the accuracy of the extensions and footings.

Type of Audit

Procedure