Which of the Following Activities Would Be Least Likely to Strengthen

question 121

Multiple Choice

Which of the following activities would be least likely to strengthen a company's internal control?

• A) separating accounting from other financial operations
• B) maintaining insurance for fire and theft
• C) fixing responsibility for the performance of employee duties
• D) carefully selecting and training employees

Recognize the treatment of a subsidiary’s investment in parent company stock.

Calculate accrual-based net income and understand its components.

Understand the principles and benefits of filing consolidated tax returns.

Compute accrual-based net income for companies in a consolidated group.

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Definitions:

Net Profit

The amount of income that remains after subtracting all expenses, taxes, and costs from total revenue.

Monetary Items

Assets and liabilities that are to be received or paid in a fixed or determinable amount of money.

Payables

Amounts that a company owes to its creditors or suppliers for goods or services received.

Borrowings

Funds that a company or individual takes on loan from another party, to be repaid over time with interest.