Which of the Following Is Not an Internal Control Activity

question 90

Multiple Choice

Which of the following is not an internal control activity for cash?

• A)Unannounced audits of cash on hand should be made occasionally.
• B)The number of persons who have access to cash should be limited.
• C)The functions of recordkeeping and keeping custody of cash should be combined.
• D)All cash receipts should be recorded promptly.

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Definitions:

Balance Sheet Account

An account found on the balance sheet, which is one of the three principal financial statements; these accounts include assets, liabilities, and shareholders' equity.

Depreciation Expense

The portion of the cost of an asset that is allocated as an expense over its useful life, reflecting the decrease in value over time.

Overstate Assets

Reporting a company's assets at a value higher than their actual worth, which can inaccurately represent financial health.

Unearned Revenue Account

An account representing cash received for goods or services not yet provided; considered a liability until the service or product is delivered.