In Obtaining an Understanding of a Manufacturing Entity's Internal Control

Multiple Choice

In obtaining an understanding of a manufacturing entity's internal control concerning inventory balances, an auditor most likely would:

A) Analyze the liquidity and turnover ratios of the inventory.
B) Perform analytical procedures designed to identify cost variances.
C) Review the entity's descriptions of controls over inventory.
D) Perform test counts of inventory during the entity's physical count.