Which of the Following Is TRUE of Internal Control

question 227

Multiple Choice

Which of the following is TRUE of internal control?

• A) A company's outside auditor is responsible for the company's internal control system.
• B) One of the major purposes of internal control is to ensure that the assets are safeguarded.
• C) Internal control procedures tend to diminish the importance of operational efficiency.
• D) Internal controls are only necessary for public companies.

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Definitions:

Form 1040

The standard IRS form used by individuals to file their annual income tax return.

Schedule A

Schedule A is a form used in filing U.S. federal tax returns to itemize eligible deductions, including medical expenses, state and local taxes, charitable contributions, and mortgage interest, which can reduce taxable income.

Form 8283

Form 8283 is used by taxpayers to report non-cash charitable contributions to the IRS that amount to more than $500 in a given tax year.

Noncash Charitable Contributions

Donations of goods or property rather than money to a charitable organization, which may be tax-deductible.