Which of the Following Statements Regarding Management Control Principles Is

question 80

Multiple Choice

Which of the following statements regarding management control principles is false?

• A) Always expect that individuals will be pulled in the direction of their own self-interest.
• B) Design incentives so that individuals who pursue their own self-interest are also achieving the organization's objectives.
• C) Evaluate actual performance based on expected or planned performance.
• D) Consider financial performance over nonfinancial performance.

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Definitions:

Debit Balances

Refers to the amounts owed by a company or individual that are recorded on the left side of the balance sheet, indicating expenses or assets.

Recording Process

The systematic method of capturing and documenting financial transactions in the accounting records of an organization.

Journal

A detailed record where all financial transactions of a business are initially recorded, serving as the primary source of accounting data.

Ledger Accounts

Financial records that provide a detailed account of all the transactions related to a particular item over a period.