Alpha Company Uses Its Sales Invoices for Posting Perpetual Inventory

question 65

Multiple Choice

Alpha Company uses its sales invoices for posting perpetual inventory records. Inadequate control activities over the invoicing function allow goods to be invoiced that are not shipped. The inadequate control activities could cause an:

• A)understatement of revenues, receivables, and inventory.
• B)overstatement of revenues and receivables and an understatement of inventory.
• C)understatement of revenues and receivables and an overstatement of inventory.
• D)overstatement of revenues, receivables, and inventory.

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Definitions:

False Comments

Incorrect or misleading statements made, often with the intention to deceive.

Routine Request

A routine request is a standard or regular request for information, services, or action within an organization or between businesses.

Direct Approach

Message organization that starts with the main idea (such as a recommendation, a conclusion, or a request) and follows that with supporting evidence.

Main Idea

A specific statement about the topic of a message.