Which of the Following Is True of Internal Control

question 62

Multiple Choice

Which of the following is true of internal control?

• A)A company's outside auditor is responsible for the company's internal control system.
• B)One of the major purposes of internal control is to ensure accurate, reliable accounting records.
• C)Internal control procedures tend to diminish the importance of operational efficiency.
• D)Internal controls are only necessary for large businesses.

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Definitions:

Number of Batches

The total count of groups or sets of items processed or produced together within a given time period, often used in manufacturing and quality control.

Activity-Based Costing

A costing method that assigns overhead and indirect costs to related products and services based on their usage of resources, providing more accurate product cost information.

Activity Cost Pools

Categories of overhead costs grouped together based on similar activities in an activity-based costing system.

Customer Margin

The profit generated from a specific customer, calculated by subtracting the costs associated with serving that customer from the revenue earned from them.