Goldman Services Hired a New Clerk to Keep Custody of and Maintain

question 151

Multiple Choice

Goldman Services hired a new clerk to keep custody of and maintain all the equipment in the equipment yard.The clerk has not yet been adequately trained on the maintenance needs of the equipment.Which internal control procedure needs strengthening?

• A) assignment of responsibilities
• B) competent, reliable, and ethical personnel
• C) separation of duties
• D) documents

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Definitions:

Historical Cost Principle

A financial reporting rule mandating that assets are documented and presented at their initial acquisition price.

Balance Sheet Reporting

The process of disclosing a company's financial health at a given moment by listing its assets, liabilities, and equity.

Financial Reporting

The process of disclosing financial results and related information by a company to its stakeholders.

Stockholders' Equity

The residual interest in the assets of a corporation after deducting liabilities, representing the ownership interest of shareholders in the company.