Which of the Following Relationships Does Not Violate the Rules

question 88

Multiple Choice

Which of the following relationships does not violate the rules of segregation of duties?

• A)Credit authorization and preparation of the sales order
• B)Preparation of the sales order and sales invoice
• C)Preparing goods for shipment and accounting for inventory
• D)Entering sales in the sales journal and handling the inventory

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Definitions:

Acquisition Differential

The gap between what is paid to buy a company and the net worth of its recognizable assets and debts.

Equity Method

A financial recording method for logging investments in subsidiary entities where the investor has considerable sway but lacks complete dominance.

Goodwill

An intangible asset that arises when a company acquires another business for a price higher than the fair value of its identifiable net assets.

Equity Method

An accounting technique used when an investor holds significant influence but not full control over an investee, allowing the investor to record a proportionate share of the investee's profits or losses.