A manufacturer is contemplating introducing a product that is inferior to its competition in its performance, design, and functionality. However, the manufacturer believes that "good brand marketing" can overcome these shortfalls
Why is this thinking incorrect?
At the heart of a great brand is a great product, the product is a key element in the market offering. Customers will judge the product (offering) on three basic elements: product features and quality; services mix and quality, and price. Not having a competitive product cannot be overcome by marketing.
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If the user of the financial statements wanted additional information, he would look at the what?
What will be an ideal response?
Auditors often perform some type of risk analysis in deciding what aspects of operations to audit and the nature, timing, and extent of their procedures. Which of the following would an auditor most likely consider an indication of material risk?
A. A high turnover rate for warehouse labor. B. Inadequate separation of responsibilities between the accounting and warehouse functions. C. A change in management in the receiving department as the result of promotion of the former department head. D. Special procedures allowing minor purchases to bypass the receiving department and be delivered directly to the appropriate requesting department.