Which of the Following Is Not a Limitation of the Internal

question 99

Multiple Choice

Which of the following is not a limitation of the internal control system?

• A)errors are made due to employee fatigue
• B)fraud occurs because of collusion between two employees
• C)the industry is inherently risky
• D)management instructs the bookkeeper to make fraudulent journal entries

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Definitions:

Retroactive Changes

Adjustments made to records, policies, or financial statements that apply to previous periods.

Loss on Disposal

The financial loss incurred when an asset is sold for less than its book value.

Accumulated Depreciation

The cumulative depreciation of an asset up to a single point in its life, representing how much of the asset's value has been used up.