The Main Reason to Establish Internal Controls in an Organization

question 65

Multiple Choice

The main reason to establish internal controls in an organization is to:

• A) Encourage compliance with policies and procedures.
• B) Safeguard the resources of the organization.
• C) Ensure the accuracy, reliability, and timeliness of information.
• D) Provide reasonable assurance on the achievement of objectives.

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Definitions:

Marginal Revenue

The additional income received from selling one more unit of a good or service.

Demand Curve

A graph showing the relationship between the price of a good and the quantity of the good that consumers are willing and able to purchase at various prices.

Elasticity

A measure of how much the quantity demanded or supplied of a good responds to a change in one of its determinants, such as price.

Inferior Goods

Goods for which demand decreases as the income of the consumer increases, opposite to normal goods.