Effective Internal Control in a Small Company That Has an Insufficient

question 61

Multiple Choice

Effective internal control in a small company that has an insufficient number of employees to permit proper division of responsibilities can BEST be enhanced by:

• A) engaging a public accountant to perform monthly 'write-up' work.
• B) employment of temporary personnel to aid in the separation of duties.
• C) direct participation by the owner of the business in the record-keeping activities of the business.
• D) delegation of full, clear-cut responsibility to each employee for the functions assigned to each.

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Definitions:

Goods and Services

Refers to the physical products and intangible benefits that fulfill the needs or wants of consumers.

Surplus

The condition when supply exceeds demand, leading to excess goods or services being available.

White Water Rafting

A recreational outdoor activity which uses an inflatable raft to navigate a river or other body of water with varying degrees of rough water.

Unit Cost

Unit cost is the total expenditure incurred to produce, store, and sell one unit of a product or service, including both fixed and variable costs.