Which of the Following Describes the Internal Control Component Risk

question 20

Multiple Choice

Which of the following describes the internal control component risk assessment?

• A)Risk assessment is designed to ensure that the business's goals are achieved.
• B)A company must identify its risks.
• C)Internal auditors monitor company controls to safeguard assets, and external auditors monitor the controls to ensure that the accounting records are accurate.
• D)Risk assessment is the 'tone at the top' of the business.

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Definitions:

Inventory Turnover Ratio

A financial metric that measures how many times a company has sold and replaced its inventory over a specific period.

Cost of Goods Sold

The immediate financial obligations related to manufacturing goods sold by a company, involving workforce and materials.

Average Inventory

A calculation used to estimate the value or quantity of inventory a business has over a certain period, often used to evaluate inventory turnover.

Average Inventory

The mean value of a company's inventory over a specific period, used to analyze inventory levels and manage stock efficiently.