The internal controls that determine the accuracy of the perpetual inventory file were tested in the revenue process and the purchase and acquisition process because
A)these processes involve movement of inventory in and out of the perpetual inventory account
B)these processes involve reconciliation of inventory in the perpetual inventory account
C)these processes involve verification of inventory in the perpetual inventory account
D)these processes involve observation of inventory in the perpetual inventory account

Question

Quizplus · Accepted Answer

The perpetual inventory file is used to track inventory in real-time as it moves in and out of the inventory account. The revenue process and the purchase and acquisition process both involve the movement of inventory in and out of the perpetual inventory account, making them key processes to test the accuracy of the perpetual inventory file.

The Internal Controls That Determine the Accuracy of the Perpetual