One of the Most Critical Controls to Prevent Theft of Inventory

question 2

Multiple Choice

One of the most critical controls to prevent theft of inventory purchased is to:

• A)Require authorization of the purchase requisition
• B)Segregate inventory custody from inventory record keeping
• C)Compare the purchase order, receiving report, and invoice
• D)Segregate the authorization of purchases from the inventory record keeping

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Definitions:

Zero Coupon Bond

A debt security that does not pay interest but is traded at a deep discount, offering profit at maturity when it is redeemed for its face value.

Face Value

The nominal value printed on a financial instrument like a bond or stock certificate, not necessarily its market value.

Interest Rate

The interest rate is the proportion, typically expressed as a percentage, at which interest is paid by borrowers for the use of money that they borrow from a lender.

Present Discounted Value

The immediate value of a forthcoming sum of money or cash flow streams, discounted at a specific rate of return.