Which of the Following Is Desirable in a Good System

question 61

Multiple Choice

Which of the following is desirable in a good system of internal accounting control?

• A) All accounting personnel in a company should be Certified Public Accountants
• B) Appropriate forms, such as checks and sales invoices, should be prenumbered
• C) To obtain the benefit of specialization, employees should not be rotated among jobs
• D) Responsibility and authority for a given function should be shared among several employees

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Definitions:

Voting Shares

Shares that give the shareholder the right to vote on matters of corporate policy, including decisions on the composition of the board of directors.

Common Shares

Shares of ownership in a corporation, entitling holders to vote at shareholder meetings and to receive dividends.

Impairment Loss

An impairment loss occurs when the carrying amount of an asset exceeds its recoverable amount, leading to a reduction in the asset’s value on the balance sheet.

Undepleted Acquisition Differential

Undepleted Acquisition Differential refers to the portion of the differential from an acquisition that has not yet been amortized or allocated to the acquired company's assets and liabilities.