Internal Controls That Should Be Applied When a Business Takes

question 117

Multiple Choice

Internal controls that should be applied when a business takes a physical count of inventory should include all of the following except:

• A) A manager confirms that all inventories are ticketed only once.
• B) Counters of inventory should be those who are responsible for the inventory.
• C) Counters confirm the validity of inventory existence, amounts, and quality.
• D) Prenumbered inventory tickets.
• E) Second counts by a different counter.

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Definitions:

Portfolio

An assortment of financial assets such as equities, debt securities, raw materials, liquid cash, and near-cash items, comprising both mutual funds and exchange-traded funds.

Expected Return

The predicted average of possible returns on an investment, weighted by the likelihood of each outcome.

Market Risk

Market risk is the potential for investors to experience losses due to factors that affect the overall performance of the financial markets, such as economic recessions or interest rate changes.

Inflation

The pace at which the average cost of products and services escalates, causing the value of money to diminish.