Well-Designed Internal Control That Is Functioning Effectively Is Most Likely

question 86

Multiple Choice

Well-designed internal control that is functioning effectively is most likely to detect a fraud arising from:

• A)The fraudulent action of several employees.
• B)The fraudulent action of an individual employee.
• C)Informal deviations from the official organization chart.
• D)Management fraud.

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Definitions:

Electronic Components

Basic discrete devices or physical entities in an electronic system used to affect electrons or their associated fields.

Percent of Sales Method

A forecasting approach where future amounts are estimated as a fixed percentage of sales.

Bad Debts Expense

An expense account that represents accounts receivable that a company does not expect to collect.

Unadjusted Trial Balance

A listing of all the accounts and their balances from the ledger, before any adjustments, used to check the arithmetic accuracy of bookkeeping.