For Sales Returns,the Least Effective Control to Prevent Fraudulent Processing

question 53

Multiple Choice

For sales returns,the least effective control to prevent fraudulent processing of a credit memo is to

• A) reconcile total of credit memos to total debits posted to customers' subsidiary ledgers.
• B) require approval for each credit memo by the credit manager.
• C) sequentially prenumber all credit memos and perform a sequence check at the end of each day.
• D) match each credit memo with a receiving report.

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Definitions:

Null Hypothesis

A hypothesis that there is no significant difference between specified populations, any observed difference being due to sampling or experimental error.

Alternative Hypotheses

The hypothesis that there is a significant difference between groups, counter to the null hypothesis.

Type II Error

A type of error that occurs when a statistical test fails to reject a false null hypothesis.

Null Hypothesis

A default hypothesis that there is no significant difference or relationship between specified populations, any observed effect is due to chance.