In Testing Controls Over Cash Disbursements, an Auditor Most Likely

question 8

Multiple Choice

In testing controls over cash disbursements, an auditor most likely would determine that the person who signs the checks also:

• A)reviews the monthly bank reconciliation.
• B)returns the checks to accounts payable.
• C)is denied access to the supporting documents.
• D)is responsible for mailing the checks.

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Definitions:

Overhead Costs

General business expenses not directly attributable to creating products or services.

Departments

Distinct areas within an organization, each focusing on a specific aspect of the business operation, such as finance, marketing, or human resources.

Products

Goods or services offered by a business to the market.

Product Costs

The costs incurred by a company to manufacture or acquire a product which include materials, labor, and overhead.