Which of the Following Procedures Would Best Prevent or Detect

question 54

Multiple Choice

Which of the following procedures would best prevent or detect the theft of valuable items from an inventory that consists of hundreds of different items selling for $1 to $10 and a few items selling for hundreds of dollars?

• A)Maintain a perpetual inventory of only the more valuable items with frequent periodic verification of the accuracy of the perpetual inventory record.
• B)Have an independent accounting firm prepare an internal control report on the effectiveness of the controls over inventory.
• C)Have separate warehouse space for the more valuable items with frequent periodic physical counts and comparison to perpetual inventory records.
• D)Require a manager's signature for the removal of any inventory item with a value above $50.

Understand the economic significance of services in the U.S. economy.

Develop insight into customer expectations and perceptions regarding services.

Understand strategies for service differentiation and competitiveness.

Recognize the importance of employee empowerment and support in delivering quality service.

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Definitions:

Depreciable Cost

The total amount that can be depreciated over the life of an asset, typically the asset's cost minus its salvage value.

Salvage Value

The foreseen redemption value of an asset after its period of usability concludes.

Useful Life

The estimated time period that an asset is expected to be usable for its intended purpose.

Equipment Cost

The total amount spent to acquire, install, and prepare equipment for its intended use, including purchase price and associated expenses.