The Objectives of Internal Control Are To

question 5

Multiple Choice

The objectives of internal control are to:

• A) prevent unintentional errors and irregularities.
• B) safeguard assets and enhance the accuracy and reliability of the accounting records.
• C) enhance the accuracy and reliability of financial statements.
• D) safeguard assets and prevent thefts.

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Definitions:

Net Income

The total profit of a company after all expenses and taxes have been subtracted from revenue.

Revenues

The income generated from normal business operations, calculated by multiplying the price of goods or services by the quantity sold.

Dividends Payable

A liability account in a company's balance sheet indicating the amount in dividends that the company owes to its shareholders but has not yet paid out.

Operating Expenses

Expenses incurred from a company's operational activities, excluding the cost of goods sold, taxes, and interest expenses.