Testing to Ensure That Bank Transfers Are Recorded in Both

question 28

Multiple Choice

Testing to ensure that bank transfers are recorded in both the receiving and disbursing banks helps to detect evidence

• A)that would reduce inherent risk to a minimum.
• B)associated with an attempt to conceal a theft of cash.
• C)that increases reliability with respect to the accuracy of the transfer schedule.
• D)that would warrant decreasing control risk to a minimum.

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Definitions:

FIFO

A cost flow assumption for inventory and financial accounting where the first goods purchased or produced are the first to be sold.

FIFO Inventory

An inventory costing method that assumes the items purchased or produced first are sold first, thereby remaining inventory consists of items added most recently.

Cash Transactions

Financial transactions involving the immediate payment of cash for the purchase of goods or services.