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please help me to answer this question CASE 1-3 ASAP, THANKS!A.INVENTORY

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please help me to answer this question CASE 1-3 ASAP, THANKS!A.INVENTORY

please help me to answer this question CASE 1-3 ASAP, THANKS!



Although fairly voluminous, purchase transactions at wending are not complex. Inventories are tightly controlled so that overstocking and obsolescence are normally not a problem. Inventory, although not as liquid as cash, is subject to theft. At wending, finished packaged products are shipped immediately to customers, although large quantities of purchased merchandise are maintained on hand. The personnel handling purchases and inventory transactions are, in general, competent. Access to the warehouse is unrestricted.


These transactions are not particularly complex at wending. Nor (except for the allowance for doubtful debts account) is there any degree of estimation involved. The persons processing revenue and trade receivables transactions are thoroughly familiar with the procedures and are generally competent. Sales transaction processing does, however, entail the completion of many transactions. Competition from overseas is becoming an issue, and because of the poor general economic conditions some customers have requested ex tensions of time to pay.

I want to know any significant audit risks with reference to the relevant facts and the key assertion at risk, and any controls relevant to the audit, thanks!

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