Maintaining Good Controls Over Merchandise Inventory Ensures That Inventory Purchases

question 40

True/False

Maintaining good controls over merchandise inventory ensures that inventory purchases are properly authorized and accounted for by the accounting system.

---

Definitions:

Personal Liabilities

Debts or obligations that an individual is responsible for, as opposed to those belonging to businesses or governmental entities.

Limited Partners

Investors in a partnership who have limited liability to the extent of their investment in the partnership. They do not partake in the day-to-day management of the business.

Limited Liability

A legal structure that limits the personal financial risk for shareholders of a company to the amount they invested in the company.

Trade Deficits

An economic condition that occurs when a country imports more goods and services than it exports.