Which of the Following Statements Is True Regarding the Documents

question 119

Multiple Choice

Which of the following statements is true regarding the documents in a voucher system?

• A)All voucher systems are the same.
• B)Recording a purchase is initiated by an invoice approval.
• C)A well-designed voucher system will allow department managers to place orders directly with suppliers for control purposes.
• D)A voucher system is most commonly used in very small companies to make up for the lack of other internal controls.
• E)A well designed voucher system will eliminate all fraud and error.

Recognize the principles of vicarious liability, including under what circumstances an employer might be liable for the actions of an employee.

Understand the legal implications of misrepresentation in the context of principal-agent relationships.

Identify the different types of principals and agents, and their implications on agency law.

Appreciate the importance of due diligence in hiring and the potential legal consequences of failing to do so.

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Definitions:

Variable Cost

Charges that are directly linked to the volume of production or sales metrics.

Fixed Costs

Costs that remain constant regardless of the amount of goods produced or sold, including expenses like rent, salaries, and insurance fees.

High-low Method

A technique in cost accounting used to estimate fixed and variable costs by analyzing the highest and lowest levels of activity and their respective costs.

Variable Cost Per Unit

The cost that varies with the level of output or production, calculated on a per-unit basis.