Which of the Following Is a Preventive Control

question 40

Multiple Choice

Which of the following is a preventive control?

• A) Reconciliation of a bank account.
• B) Recalculation of a sample of payroll entries by internal auditors.
• C) Separation of duties between the payroll and personnel departments.
• D) Detailed fluctuation analysis completed by the CFO for revenue.

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Definitions:

Manufacturing Overhead

Indirect factory-related costs that cannot be directly traced to a specific product, including salaries of supervisors, rent, and utilities of the factory.

Opportunity Cost

Opportunity cost represents the value of the best alternative that is foregone when a particular decision is made, indicating the cost of missed opportunities.

Alternatives

Different choices or options available to a decision-maker in a decision-making process.

Potential Benefit

The anticipated advantage or value that might be gained from a particular action or investment, not assured but possible.