Which of the Following Is an Appropriate Internal Control Activity

question 75

Multiple Choice

Which of the following is an appropriate internal control activity for cash?

• A) The amount of cash on hand should be kept to a maximum.
• B) All payments should be made with currency,not checks.
• C) Banking facilities should be used as little as possible.
• D) Recordkeeping and custodianship over cash should be performed by separate individuals.

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Definitions:

Net Income

The amount of profit left over after all expenses, taxes, and costs have been subtracted from total revenue.

Net Loss

The amount by which total expenses exceed total revenues in a specific period, indicating financial loss.

Balance Sheet

A financial statement that provides a snapshot of a company’s financial position by listing assets, liabilities, and equity at a specific point in time.

Owner's Equity

The residual interest in the assets of a business after deducting liabilities, representing the ownership interest of the shareholders or owners.