Which of the Following Most Likely Would Be the Result

question 15

Multiple Choice

Which of the following most likely would be the result of ineffective internal control policies and procedures in the revenue process?

• A)Final authorization of credit memos by personnel in the Sales Department could permit an employee defalcation scheme.
• B)Fictitious transactions could be recorded, causing an understatement of revenues and an overstatement of receivables.
• C)Irregularities in recording transactions in the subsidiary accounts could result in a delay in goods shipped.
• D)Omission of shipping documents could go undetected, causing an understatement of inventory.

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Definitions:

Negligently Failed

The act of failing to take reasonable care in doing something, leading to unintended harm or damage.

Trial Court

A court in which most civil or criminal cases start when they first enter the legal system. The parties present evidence and call witnesses to testify. Trial courts are referred to as courts of common pleas or county courts in state court systems and district courts in the federal system. Also called court of original jurisdiction and court of first instance.

Manufacturer Negligent

A situation when a manufacturer fails to ensure the safety and efficacy of their product, resulting in harm to consumers.

Failing To Warn

The legal culpability faced by an entity for not properly informing consumers or users of a product's latent dangers or risks, potentially leading to harm.