Which of the Following Controls Would Be Most Successful in Mitigating

question 92

Multiple Choice

Which of the following controls would be most successful in mitigating the theft of customer checks received in the mail?

• A) Custody of receipts by the accounts receivable manager.
• B) Restricted endorsements placed on the check as soon as it arrives.
• C) Weekly deposits to a secure bank.
• D) Reconciliation of bank accounts each month.

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Definitions:

Coupon Rate

The interest rate on a bond that the issuer promises to pay annually or semi-annually to the bondholder.

Market Yield

The annual income on an investment divided by the market price of the investment, typically expressed as a percentage.

Premium

The amount by which the price of a security exceeds its principal amount or its value at issuance.

Discount

The reduction from the full amount or value of something, especially the price of a financial instrument or merchandise.