A Burglar Took Some Blank Checks During a Break-In at XYZ

question 5

Multiple Choice

A burglar took some blank checks during a break-in at XYZ Company.He was careful to make sure that the theft would be difficult to discover.Three months later,he wrote himself a check for $20,000 and signed the company treasurer's name on the check.After the check was cashed,the loss was discovered.Which commercial crime coverage form would cover this loss?

• A)Inside the Premises-Theft of Money and Securities
• B)Money Orders or Counterfeit Currency
• C)Forgery or Alteration
• D)Outside the Premises

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Definitions:

Gross Profit

The financial metric calculated by subtracting the cost of goods sold from total sales revenue.

Ending Inventory

The total value of all goods available for sale at the end of an accounting period, calculated as the beginning inventory plus purchases minus the cost of goods sold.

Perpetual Inventory System

An accounting approach that continuously tracks inventory levels and costs, updating the general ledger after each receipt or sale of goods.

FIFO

"First In, First Out," an inventory valuation method where goods purchased or produced first are the first ones to be sold or used.