Which of These Is Not an Important Principle for the Control

question 27

Multiple Choice

Which of these is not an important principle for the control of cash payments?

• A) Employees who sign cheques should not accept delivery of goods.
• B) Only senior staff should have the authority to approve invoices for payment.
• C) Cheques should be written out promptly even if the invoice is not yet provided.
• D) Once the cheque is written the invoice should be stamped 'paid'.

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Definitions:

New Machine

Refers to the acquisition of a new piece of equipment or machinery intended to increase productivity or efficiency in a manufacturing or operational process.

Payback Period

The amount of time it takes for an investment to generate an amount of income or cash equivalent to the cost of the investment.

Investment

The allocation of resources, such as capital, time, and effort, in something to earn a return or achieve a goal.

Present Value

The present worth of a future amount of money or series of cash flows when discounted at a certain rate of return.