Which One of the Following Is NOT a Component of an Entity's

question 36

Multiple Choice

Which one of the following is NOT a component of an entity's internal control?

• A) the accounting system
• B) the control environment
• C) control risk
• D) control procedures

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Definitions:

Contribution Margin

The amount by which sales revenue exceeds variable costs, indicating how much revenue contributes towards covering fixed costs and generating profit.

Outside Supplier

A third-party company or entity that provides products or services to another company, often used when in-house production or provision is not feasible.

Relevant Cost

Costs that will be affected by a decision in the future and therefore should be considered in the decision-making process.

Direct Labor Cost

Expenses associated with the wages and benefits of employees who are directly involved in the manufacturing process.