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:

Conservatism

A political and social philosophy promoting traditional institutions and practices, emphasizing stability, continuity, and respect for cultural heritage.

Pretend Play

A form of play in which children use their imagination to create scenarios, often involving role-playing or make-believe.

Conservation

The principle in cognitive development that recognizes the ability to understand that redistributing material does not affect its mass, number, or volume.

Egocentrism

A cognitive bias where an individual is unable to differentiate between their own perspective and that of others.