Which of the Following Statements Is Not True Regarding Internal

question 50

Multiple Choice

Which of the following statements is not true regarding internal control procedures?

• A) Internal control procedures include methods to achieve compliance with laws and regulations.
• B) Internal control procedures direct operations toward common goals.
• C) Internal control procedures are designed to safeguard company assets.
• D) Internal control procedures are not affected by the cost-benefit principle.
• E) Internal control procedures are designed to ensure reliable financial reports.

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Definitions:

Output Increases

A rise in the quantity of goods or services produced by a company or economy.

Law of Diminishing Returns

The principle that as the level of investment in a particular area increases, the rate of profit from that investment, after a certain point, cannot continue to increase if other inputs remain constant.

Marginal Cost

The cost of producing one additional unit of a good or service.

Average Total Cost

The total cost of production divided by the quantity produced, indicating the cost effectiveness of producing goods.