Which of the Following Controls Would Be Most Effective in Ensuring

question 63

Multiple Choice

Which of the following controls would be most effective in ensuring that the proper custody of assets in the investing cycle is maintained?

• A)Direct access to securities in the safety deposit box is limited to only one corporate officer.
• B)Personnel who post investment transactions to the general ledger are not permitted to update the investment subsidiary ledger.
• C)The purchase and sale of investments are executed on the specific authorization of the board of directors.
• D)Independent personnel periodically compare the recorded balances in the investment subsidiary ledger with the contents of the safety deposit box.

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Definitions:

Competing Companies

Businesses that are in direct rivalry with one another, offering similar products or services in the same market.

Warranties On Purchases

Guarantees provided by a seller to a buyer ensuring the quality and performance of a product for a certain period.

Maintain More Than One Supply Source

The strategy of sourcing materials or products from multiple suppliers to reduce dependency on a single source.

Competitive Bidding

a procurement process where multiple suppliers submit offers, or bids, to win a contract to supply goods or services, often promoting fair pricing and quality.