Due to Data Errors Occurring from Time to Time in Processing

question 19

Multiple Choice

Due to data errors occurring from time to time in processing the Albert Company's payroll, the company's management is considering the addition of a data validation control procedure that is projected to reduce the risk of these data errors from 13% to 2%.The cost of the payroll reprocessing is estimated to be $11,000.If the data validation control procedure is implemented, the cost of this procedure is expected to be $700 per pay period (employees are paid biweekly) .Based on the above data, which of the following statements is true?

• A)The data validation control procedure should be implemented because its net estimated benefit is $1,210
• B)The data validation control procedure should be implemented because its net estimated benefit is $510
• C)The data validation control procedure should not be implemented because the $700 expected cost per pay period exceeds the procedure's expected benefit
• D)The data validation control procedure should not be implemented because its net estimated benefit is a negative $1,210, thereby causing the control procedure to fail in terms of being cost effective

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Definitions:

Self-Concept

An individual's perception of themselves, including beliefs about personality traits, physical characteristics, abilities, values, goals, and roles.

Agent Self

A concept in psychology that refers to the aspect of an individual’s self-concept that is involved in making decisions and taking actions.

Interdependent Self-Construal

A concept of oneself that is closely linked with and defined by relationships with others, emphasizing connectedness and social context.

Interpersonal Self

The aspect of an individual's self-concept that is formed in relation to their social environments and interactions with others.