To Determine Whether Internal Control Structure Policies and Procedures Operated

question 35

Multiple Choice

To determine whether internal control structure policies and procedures operated effectively to minimise errors of failure to invoice a shipment, the auditor would select a sample of transactions from the population represented by the:

• A)bill of lading file.
• B)customer order file.
• C)accounts receivable master file.
• D)goods received notes file.

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Definitions:

Per Unit

A term referring to the cost or price of a single item or service when discussing bulk production or sales.

Variable Costing

An accounting method that includes only variable production costs (costs that change with the level of production) in product costs.

Absorption Costing

A financial accounting technique that integrates all production expenses, including direct materials, direct labor, along with all variable and fixed manufacturing overhead costs, into the product's cost.

Variable Production Costs

Costs that vary directly with the level of production output, such as raw materials and labor expenses.