The Component of an Internal Control System That Concerns Itself

question 56

Multiple Choice

The component of an internal control system that concerns itself with the way a company's management assigns authority and responsibility is called:

• A)Monitoring
• B)Control environment
• C)Risk assessment
• D)Information

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Definitions:

Profit Margin

A financial indicator that calculates how much net profit is generated for every dollar of sales by examining the relationship between a company's net income and its revenue.

Projected Addition

An estimate of future increases or expansions in inventory, assets, or capacity planned by a firm.

Current Ratio

The Current Ratio is a liquidity metric that measures a company's ability to pay short-term obligations or those due within one year, calculated as current assets divided by current liabilities.

Notes Payable

Financial obligations represented by formal written agreements to pay a specific sum of money at a future date.