As an In-Charge Auditor, You Are Reviewing a Summary of Control

question 27

Multiple Choice

As an in-charge auditor, you are reviewing a summary of control weaknesses in cash disbursement procedures. Which one of the following weaknesses, standing alone, should cause you the least concern?

• A)Checks are signed by only one person.
• B)Signed checks are distributed by the controller to approved payees.
• C)Treasurer fails to establish validity of names and addresses of check payees.
• D)Cash disbursements are made directly out of cash receipts.

Become familiar with people-oriented actions leaders can take to successfully implement change.

Understand the concept and application of benchmarking in organizational learning and improvement.

Recognize the benefits and limitations of formalizing best practices into organizational doctrine for learning and innovation.

Differentiate between exploration and exploitation in organizational innovation.

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Definitions:

Predetermined Overhead Rate

A calculated rate used to assign overhead costs to products or services, based on estimated or budgeted overhead expenses and activity.

Unit Product Costs

The calculated cost to produce one unit of product, including direct materials, labor, and overhead.

Predetermined Overhead Rate

The rate calculated before the accounting period begins, used to allocate overhead costs to products or job orders based on a consistent activity base.

Machine-Hours

A measure of production output or activity level, representing the total hours that machinery is operating over a specific period of time.