An auditor concluded that no excessive costs for idle plant were charged to inventory in a client's standard costing system. This conclusion most likely related to the auditor's objective to obtain evidence about the account balance
Assertion for inventory of:
A) valuation and allocation.
B) completeness.
C) existence.
D) rights and obligations.

Question

Quizplus · Accepted Answer

The auditor's conclusion relates to the valuation and allocation assertion for inventory. The auditor has specific objectives related to inventory valuation, including ensuring that excessive costs are not included in inventory value. In this case, the auditor has obtained evidence that supports the conclusion that no excessive costs for idle plant were charged to inventory, which provides evidence regarding the accuracy of inventory valuation and allocation.

An Auditor Concluded That No Excessive Costs for Idle Plant