Which of the Following Demonstrates a Poor Internal Control Procedure

question 105

Multiple Choice

Which of the following demonstrates a poor internal control procedure?

• A)The bookkeeper makes cash deposits and records journal entries related to cash,while the treasurer prepares the bank reconciliation.
• B)The president,who does no bookkeeping,prepares the bank reconciliation each month.
• C)The treasurer signs all checks after the bookkeeper prepares the supporting documents.
• D)One bookkeeper prepares cash deposits and the other bookkeeper enters the collections in the journal and ledger.

---

Definitions:

Budgeting

The process of creating a plan to spend your money, outlining anticipated expenses and income to guide financial operations.

Administrative Expenses

Administrative Expenses are overhead costs not directly tied to a specific function such as manufacturing, production, or sales, and can include salaries, rent, and office supplies.

Budgeting

A financial planning process whereby individuals or entities estimate their expected incomes and expenditures over a defined period.

Activity Variance

Activity variance calculates the difference between the planned quantity of activity and the actual quantity, analyzing the impact on costs and operational efficiency.