Which of the Following Controls Most Likely Would Be Effective

question 66

Multiple Choice

Which of the following controls most likely would be effective in offsetting the tendency of sales personnel to maximize sales volume at the expense of high bad debt write-offs?

• A)Employees responsible for authorizing sales and bad debt write-offs are denied access to cash.
• B)Shipping documents and sales invoices are matched by an employee who does not have authority to write off bad debts.
• C)Employees involved in the credit-granting function are separated from the sales function.
• D)Subsidiary accounts receivable records are reconciled to the control account by an employee independent of the authorization of credit.

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Definitions:

Tax

A mandatory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of some goods, services, and transactions.

Imports

Materials or services procured from another country and introduced into a domestic market for sale purposes.

Economic Integration

The process by which different countries reduce trade barriers and coordinate their economic policies to facilitate more efficient trade and investment.

Free-Trade Zone

A specially designated area where goods can be imported, stored, handled, manufactured, or reconfigured without being subject to customs duty.