Which Internal Control Procedure Is Followed When Management Authorizes the Purchasing

question 98

Multiple Choice

Which internal control procedure is followed when management authorizes the purchasing department to order goods and services for the company?

• A) Segregation of duties
• B) Safeguarding of assets and records
• C) Independent verifications
• D) Proper authorizations

---

Definitions:

Variable Cost

Expenses that directly fluctuate in relation to the amount of goods or services produced, including labor and materials.

Marginal Cost

The increase in cost resulting from the production of an extra product or service unit.

Marginal Cost

The cost of producing one more unit of a good or service, which may change with the level of output.

Fixed Cost

Expenses that remain constant regardless of production or sales volume, including rent, salaries, and insurance.