One of the Major Components of an Organization's Internal Control

question 26

Multiple Choice

One of the major components of an organization's internal control structure includes:

• A)major new financing.
• B)the financial environment.
• C)risk assessment.
• D)telecommunication equipment.

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Definitions:

Direct Materials Price Variance

The difference between the actual cost of direct materials and the standard cost, multiplied by the actual quantity purchased.

Material Costing

The process of determining the cost of materials used in the production of goods, including direct materials and allocable portions of indirect materials.

Standard Materials Cost

The pre-determined cost of materials that is expected to be incurred under normal conditions.

Price Variance

The difference between the actual cost of a good or service and its expected cost, often used in budgeting and financial analysis.