Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AA Exams › Mock question – inventory & supplier balance
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Ken Garrett.
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- September 15, 2015 at 6:36 am #271875
Dear Tutor,
I have two questions, please explain for me.
Question 1
Which of the following tasks would NOT help to gather evidence about the closing inventory figure in the statement of financial position.
What are these known as?
A. Comparing inventory costs to sales invoices
B. Calculating the quick ratio
C. Review of inventory items to see when the last sales occurred
D. Tracing inventory costsI chosen A, answer is B, please kindly explain.
Question 2
Which of the following could identify a supplier’s balance that had been omitted from the list of payables balances?
A. Reconciling the balances to supplier statements
B. Choosing a sample of suppliers from the list and writing to them asking them to confirm their balance
C. Tracing a sample of supplier invoices to the supplier accounts
D. Tracing from supplier accounts to invoices and subsequent paymentsI chosen A, the answer is C, please kindly explain.
Many thanks
September 15, 2015 at 7:58 am #2718801 Why would the quick ratio help? It excludes inventory. A is getting at cut-off checks.
2 A will not work. If a supplier is not on the list of balances it will never be chosen for reconciliation. C is tracing from invoices to accounts, not invoices to the list of balances – and a balance could have been omitted from there.
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