Which of the Following Is a Preventive Control

question 135

Multiple Choice

Which of the following is a preventive control?

• A)credit check before approving a sale on account
• B)bank reconciliation
• C)physical inventory count
• D)comparing the accounts receivable subsidiary ledger to the control account

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Definitions:

Total Revenues

The total amount of money received by a company from its sales of goods or services before any expenses are subtracted.

Variable Costs

Costs that vary directly with the level of production or sales, like raw materials and labor.

Economic Profit

The financial gain that exceeds both the total opportunity costs of production and the accounting costs, reflecting the additional value created from business activities.

Accounting Profit

The profit a company has after deducting all its expenses from its total revenue.