An Internal Control Questionnaire Indicates That an Approved Receiving Report

question 34

Multiple Choice

An internal control questionnaire indicates that an approved receiving report is required to accompany every check request for payment of merchandise.Which of the following procedures provides the best evidence on operating effectiveness?

• A)Select and examine receiving reports and test whether the related canceled checks are dated no earlier than the receiving reports.
• B)Select and examine receiving reports and test whether the related canceled checks are dated no later than the receiving reports.
• C)Select and examine canceled checks and test whether the related receiving reports are dated no earlier than the checks.
• D)Select and examine canceled checks and test whether the related receiving reports are dated no later than the checks.

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Definitions:

Supply Curves

Graphical representations showing the relationship between the price of a good and the quantity of that good that suppliers are willing and able to sell, holding other factors constant.

Long Run

A period in economics in which all factors of production and costs are variable, allowing all inputs to be adjusted.

Perfectly Inelastic

A situation where demand does not change at all in response to changes in price.

Quantity Supplied

The total amount of a good or service that producers are willing and able to sell at a certain price over a specified period.