Which of the Following Is True of Source Documents in an Accounting

question 37

Multiple Choice

Which of the following is true of source documents in an accounting information system?

• A)All journal entries can be considered as source documents in an accounting information system.
• B)Source documents provide control and reliability in an accounting information system.
• C)A manual document cannot be considered as a source document in an accounting information system.
• D)In a manual accounting information system,source documents refer to financial statements.

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Definitions:

Gross Profit

The revenue from sales minus the cost of goods sold, indicating the efficiency of a company's core operations.

Intra-entity Sales

Sales transactions occurring between two parts of the same entity, often involving the transfer of goods or services.

Equity Method

A method for recording investments in which the investor acknowledges its share of investee profits and losses in proportion to its ownership.

Income Recognition

The process by which revenue is accounted for and recorded on the financial statements in the period it is earned and can be reliably measured.