The Two Main Objectives of Internal Controls Are

question 1

Multiple Choice

The two main objectives of internal controls are:

• A) to support the automated parts of the business in the functioning of the controls in place.
• B) to prevent or detect misstatements in the financial statements.
• C) both a and b
• D) none of the above.

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Definitions:

Net Income

The total profit of a company after all expenses and taxes have been subtracted from total revenue.

Variable Costs

Expenses that vary in relation to the amount of product or service produced by a company.

Fixed Costs

Costs that do not change with the level of production or sales, such as rent, salaries, and insurance.

Break-even Point

The point at which total costs and total revenue are equal, meaning there is no net loss or gain.