Describe an Internal Control That Would Prevent the Charging of Depreciation

question 8

Essay

Describe an internal control that would prevent the charging of depreciation expense to the maintenance department for a sweeper that is now located in and used by the engineering department.

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Definitions:

Actual Inflation Rate

The percentage increase in the general price level of goods and services in an economy over a period of time, as measured by the consumer price index or other methods.

Real Rate

The real rate is the interest rate adjusted for inflation, providing a more accurate measure of the true return on an investment or the true cost of borrowing.

Interest

The cost of borrowing money or the return on investment, typically expressed as a percentage of the principal.

Interest Rate

Refers to the cost of borrowing money, expressed as a percentage of the amount loaned, or the return on invested savings.