Audit Objectives that Apply to One Sales Portion

B

The correct answer to this question is option A - "Ensure that daily activity of each salesman is reviewed by head salesman".

Audit objectives are specific goals that an auditor sets out to achieve during the audit process. The purpose of an audit is to evaluate the effectiveness of an organization's internal controls, policies, and procedures, and to ensure that financial statements are accurate and reliable. In the case of a sales portion, the objectives of an audit would typically include:

A. Ensuring that inventory is being accurately marked to market on a continuing basis. This objective is important because it ensures that the company's financial statements reflect the true value of its inventory, which is a significant asset for most businesses.

B. Ensuring that customer markups are reasonable relative to NASD. This objective is important because it ensures that customers are not being charged unfairly high prices for products or services, which could damage the company's reputation and lead to legal liabilities.

C. (Option D) None of these. If this option were chosen, it would suggest that all of the audit objectives apply to the sales portion, which is not the case.

Option A, "Ensure that daily activity of each salesman is reviewed by head salesman," is not a typical audit objective for a sales portion. While it may be a useful practice for the company to review the daily activities of its sales staff, it is not a specific objective that an auditor would set out to achieve. Instead, auditors would focus on broader objectives related to the sales process as a whole, such as those outlined in options A, B, and C above.

In conclusion, the correct answer is option A - "Ensure that daily activity of each salesman is reviewed by head salesman" - as it is not a typical audit objective for a sales portion.