Which of the Following Is Most Likely to Be Considered

question 53

Multiple Choice

Which of the following is most likely to be considered a risk assessment procedure relating to internal control?

• A)Confirm accounts receivable.
• B)Perform a test of a control relating to payroll.
• C)Take test counts of the year-end inventory.
• D)Trace a transaction through the information system relevant to financial reporting.

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Definitions:

Consumer Surplus

The discrepancy between the amount consumers are prepared to pay for a product or service and the amount they end up paying.

Demand Curve

A graphical representation of the relationship between the price of a good and the quantity demanded, typically downward sloping, indicating an inverse relationship.

Marginal Cost

The cost of producing one more unit of a good or service, considering variable costs but not fixed costs.

Block Pricing

Practice of charging different prices for different quantities or “blocks” of a good.