Which of the Following Is an Example of Exercising Internal

question 113

Multiple Choice

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

• A) separating cash collection and credit approval duties
• B) extending credit to all customers who apply for credit
• C) combining the duties of the credit and accounting departments
• D) allowing credit department employees to collect cash from customers

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Definitions:

Economic Profit

The gap highlighted by the difference in total income and total outgoings, including every cost, for a company.

Monopolistically Competitive

A monopolistically competitive market structure is characterized by many firms offering differentiated products or services, allowing for some degree of market power and pricing over their unique products.

Demand Schedule

A table or graph showing the quantity of a good or service that consumers are willing and able to purchase at various price points, illustrating the relationship between price and demand.

Economic Profit

A measure of profitability calculated by subtracting both explicit and implicit costs from total revenues, indicating the financial success beyond recovering invested costs.