From an Internal Control Standpoint the Asset Most Susceptible to Improper

question 159

Multiple Choice

From an internal control standpoint the asset most susceptible to improper diversion and use is

• A) prepaid insurance.
• B) cash.
• C) buildings.
• D) land.

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Definitions:

Accounts Payable

Money that a company owes to its suppliers or vendors for goods and services received but not yet paid for.

Merchandise Inventory

The total cost of all goods that a company has in stock and available for sale, at any given time.

Merchandise Inventory

The total value of a company's goods that are ready for sale but still in stock, representing a current asset on the balance sheet.

Accounts Payable

A liability in the form of amounts owed by a company to its creditors or suppliers for goods or services received.