Which One of the Following General Factors Should Not Be

question 92

Multiple Choice

Which one of the following general factors should not be considered critical in assessing severity of internal control deficiencies?

• A)Control environment
• B)Evidence from a poorly controlled system
• C)Repeatability of a process
• D)Complexity and subjectivity of the account balance

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Definitions:

Overapplied Manufacturing Overhead

The condition wherein the overhead allocated during the production process exceeds the actual overhead costs incurred.

Predetermined Overhead Rate

This rate is calculated before a period begins and is used to allocate overhead costs to products based on a chosen activity base.

Gross Margin

The difference between sales revenue and the cost of goods sold, representing the fundamental profitability of the goods or services sold.

Manufacturing Overhead

All indirect costs associated with the production process, including utilities, maintenance, and salaries of production managers, not directly attributable to a specific product.