Calculating the gross margin for the current year under audit as a percent of sales and comparing it with previous years is what type of evidence?
A) physical examination
B) analytical procedures
C) observation
D) inquiry

Question

Quizplus · Accepted Answer

Calculating the gross margin for the current year as a percent of sales and comparing it with previous years is a type of analytical procedure. It involves analyzing relationships between financial and non-financial data to identify significant fluctuations or anomalies that may warrant further investigation.

Calculating the Gross Margin for the Current Year Under Audit