Which of the Following Is an Example of Exercise of Internal

question 52

Multiple Choice

Which of the following is an example of exercise of internal control over receivables?

• A)separate cash collection and credit allowance duties
• B)extend credit only to customers who are most likely to pay
• C)pursue collection from customers to maximize cash flow
• D)ensure quick recovery of accounts receivable

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Definitions:

Investment

The allocation of resources, usually money, in assets or ventures expecting future financial returns, appreciation, or income.

Straight-Line Method

A depreciation technique that allocates an equal amount of an asset's cost to each year of its useful life.

Payback Period

The length of time it takes to recover the initial investment cost through the accumulated cash flows from an investment.

Simple Rate

A term that could refer to a basic or straightforward interest rate, without compounding effects.