Which of the Following Is a Benefit Provided by Internal

question 237

Multiple Choice

Which of the following is a benefit provided by internal control?

• A) ensuring timely collection of accounts receivables
• B) ensuring that collusion will never happen
• C) ensuring that a business is profitable
• D) promoting operational efficiency

Understand the impact of business transactions on the financial statements.

Identify account types and their normal balances.

Calculate financial ratios and understand their implications.

Record transactions in journals and post them to the general ledger.

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Definitions:

Safety Inventory

Additional stock that is kept on hand to protect against variability in demand or supply, ensuring product availability.

Aggregate Planning

The process of creating a production plan to meet demand over a medium-term horizon while minimizing costs.

Production Level

The quantity of goods or services produced within a specified period by a company, factory, or manufacturing plant.

Forecast Errors

Discrepancies between predicted values and actual outcomes in forecasting, which can arise due to unexpected market changes or inaccurate data.