Which of the Following Are Internal Controls Relating to Accounts

question 35

Multiple Choice

Which of the following are internal controls relating to accounts receivable?
I. Sending monthly statements of account to customers.
II.Reviewing slow paying accounts.
III. Regular reconciliation of the debtors control account and the subsidiary ledger.
IV.Separating the functions of maintaining the accounts receivables with processing of cash receipts.
V.Allowing debtors discount for early settlement.

• A) I III and V only.
• B) I, II and IV only
• C) I, II, III, and IV only
• D) I, II, III, IV and V.

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Definitions:

Conversion Cost

The sum of direct labor and manufacturing overhead costs, representing the costs to convert raw materials into finished goods.

Equivalent Units

A concept used in cost accounting to convert units of production into an amount of completed units to measure progress.

Conversion Costs

Costs specifically associated with converting raw materials into finished goods, which include labor and overhead.

Whole Units

The number of units in production during a period, whether completed or not.