The 1992 COSO Report Identifies Five Components for an Effective

question 64

Multiple Choice

The 1992 COSO report identifies five components for an effective internal control system.Which of those five establishes the tone of a company and influences the control awareness of the company's employees?

• A)Control procedures
• B)Control environment
• C)Control activities
• D)Information and communication

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Definitions:

Fixed Manufacturing Overhead

Costs associated with the production process that do not vary with the volume of production, such as factory rent.

Variable Overhead Efficiency Variance

The difference between the actual variable overheads incurred and the standard cost of those overheads for the actual production level.

Electrical Motor

A device that converts electrical energy into mechanical energy, used in a multitude of applications from household appliances to industrial machinery.

Standard Labor-Hours

The predetermined amount of labor time estimated for the completion of a task or production of goods under normal conditions.