Which of the Following Scenarios Exemplifies a Potential Internal Control

question 256

Multiple Choice

Which of the following scenarios exemplifies a potential internal control weakness?

• A) The same employee who receives cash from customers prepares a prelisting of cash receipts.
• B) The same employee who records cash receipts in the accounts receivable subsidiary ledger ensures that the ledger automatically updates the information.
• C) The same employee who restrictively endorses checks received from customers prepares the bank's check deposit slips.
• D) The same employee who makes deposits at the bank prepares the monthly bank reconciliation.

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Definitions:

Total Quality Management

A comprehensive approach to long-term success through customer satisfaction, focusing on continuous improvement in all organizational processes.

Just-in-Time Manufacturing

Just-in-Time Manufacturing is a production model that aims to reduce in-process inventory and associated carrying costs by producing goods only as they are needed.

Customer Deliveries

The process or action of delivering goods to customers, often involving logistics, scheduling, and ensuring the right products reach customers in a timely manner.

Lean Business Model

A strategy focused on creating value for the end customer with the least possible waste, emphasizing efficiency and the elimination of non-value-added activities.