For Effective Internal Control Purposes, the Accounts Payable Department Generally

question 127

Multiple Choice

For effective internal control purposes, the accounts payable department generally should:

• A) stamp, perforate, or otherwise cancel supporting documentation after payment is mailed.
• B) obliterate the quantity ordered on the receiving department copy of the purchase order.
• C) establish the agreement of the vendor's invoice with the receiving report and purchase order.
• D) ascertain that each requisition is approved as to price, quantity, and quality by an authorised employee.

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Definitions:

MRP

Marginal Revenue Product, a term in economics that represents the additional revenue generated by employing one more unit of a factor, such as labor or capital.

Investment

The allocation of resources, such as capital or time, in order to generate future profit or income.

Usury Laws

Statutes that set maximum interest rates that can be charged on loans, intended to protect consumers from excessively high rates.

Interest Rates

The cost of borrowing money or the return on investment, typically expressed as a percentage of the principal.