6. A set of engagement working papers contained a copy of a document providing information that an expensive item that had been special-ordered was actually on hand on a particular date. The most likely source of this information is a printout from a computerized.
A. Purchases journal.
B. Cash payments journal.
C. Perpetual inventory file.
D. Receiving report file.
Answer (C) is correct.
REQUIRED: The most likely source of evidence that an item was actually on hand on a particular date.
DISCUSSION: In a perpetual inventory system, purchases are directly recorded in the inventory account, and cost of goods sold is determined as the goods are sold. A computerized perpetual inventory file has a record of each debit or credit transaction with its date, amount, etc., and the inventory balance for any given date could therefore be determined.
Answer (A) is incorrect. The purchases journal indicates when the item was ordered but not whether it was still on hand at a specific later date.
Answer (B) is incorrect. The cash payments journal indicates when the item was paid for but not whether it was still on hand at a specific later date.
Answer (D) is incorrect. The receiving report indicates when the item was received but not whether it was still on hand at a specific later date.