An auditor decides to perform an inventory turnover analysis for both raw materials inventory and finished goods inventory.

An auditor decides to perform an inventory turnover analysis for both raw materials inventory and finished goods inventory.

The analysis would be potentially useful in:

I. Identifying products for which management has not been attuned to changes in market demand.

II. Identifying potential problems in purchasing activities.

III. Identifying obsolete inventory.
A . III only
B . I and II only
C . II and III only
D . I, II, and III

Answer: D