When Cash Is Received from a Remote Source,the Accounting Department

question 78

Multiple Choice

When cash is received from a remote source,the accounting department then compares the total on the cash receipts list with the stamped deposit slip received from the bank.Which internal control principle is being met with this procedure?

• A)Document procedures
• B)Independently verify
• C)Restrict access
• D)Segregate duties

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Definitions:

Factory Overhead Rates

The method used to allocate all indirect manufacturing costs to products, based on a predetermined rate.

Products

Goods or services offered by a business to satisfy customer needs or wants.

Service Companies

Businesses that provide intangible products or services rather than physical goods.

Cost Distortions

Misallocations or inaccuracies in the assignment of costs to products or services, often leading to misleading cost information.