Question

When verifying debits to the perpetual inventory records of a non-manufacturing company, auditors would be most interested in examining a sample of purchase ________?

1) approvals
2) requisitions
3) orders
4) invoices

Answer 1

Auditors verify debits to perpetual inventory records by examining purchase invoices, which provide detailed and accurate transaction costs, aiding in confirming inventory account accuracy.

Step-by-step explanation:

When verifying debits to the perpetual inventory records of a non-manufacturing company, auditors would be most interested in examining a sample of purchase invoices. This is because invoices serve as the primary source document that reflects the actual cost of goods purchased and includes details like quantity, price, terms of the sale, and description of the goods. As auditors aim to confirm that the recorded transactions accurately reflect the business's financial position, they will review invoices to validate the amounts posted to the inventory accounts and ensure proper recording of inventory transactions.