Internal Controls Have Four Fundamental Purposes

question 32

Multiple Choice

Internal controls have four fundamental purposes.Which of the following pairs an internal control for XBRL with an appropriate purpose of internal control?

• A)Electronic tagging, promoting operating efficiency
• B)Centralized approval process for taxonomy additions, safeguarding assets
• C)Both electronic tagging, promoting operating efficiency and centralized approval process for taxonomy additions, safeguarding assets
• D)Neither electronic tagging, promoting operating efficiency nor centralized approval process for taxonomy additions, safeguarding assets

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Definitions:

General Journal

A primary accounting record where financial transactions are chronologically recorded before being posted to specific accounts in the general ledger.

Purchases Transactions

Activities related to buying goods and services for use or resale by a business.

Sales Transactions

The process of exchanging goods or services for money or other assets, recorded by businesses as revenue.

Asset Turnover Ratio

A financial metric indicating how efficiently a company utilizes its assets to generate sales revenue.