COSO Defines Internal Control as a Process, Affected by an Entity's

question 37

Multiple Choice

COSO defines internal control as a process, affected by an entity's board of directors, management, and other personnel, designed to provide reasonable assurance regarding the achievement of objectives in:

• A) Effectiveness and efficiency of operations.
• B) Reliability of financial advice.
• C) Compliance with local ordinances.
• D) All of these answer choices are correct.

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Definitions:

Fixed Costs

Costs that do not vary with the level of output in the short term, such as rent, salaries, and loan payments.

Total Revenue

The total amount of money received by a firm from the sale of its goods or services, calculated as price times quantity sold.

Total Variable Cost

The total of all costs that vary with the level of production, such as materials and labor costs.

Total Fixed Cost

The sum of all costs that do not change with the level of production or output in the short term, such as rent or salaries.