Fraud Occurs When Perceived Pressure,perceived Opportunity and Rationalization Combine

question 4

Multiple Choice

Fraud occurs when perceived pressure,perceived opportunity and rationalization combine.Which of the following is related to the problem of segregation of duties?

• A)Julie writes expense checks and Mark collects cash from customers.
• B)Bob order office supplies and deposits the company's checks.
• C)Steve records receivables and writes off bad debts.
• D)Rebecca records journal entries and orders lunch.

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Definitions:

Absorption Costing

A method of accounting that encompasses all costs associated with manufacturing a product, including direct materials, direct labor, and all manufacturing overhead costs, both fixed and variable.

Variable Costing

A costing method where only variable costs (costs that change with production volume) are included in the product cost, excluding fixed costs.

Fixed Manufacturing Overhead

Costs that remain constant regardless of the level of production, such as rent, utility bills, and salaries for certain employees.

Net Profit

The amount of money that remains after all operating expenses, interest, taxes, and preferred stock dividends have been subtracted from a company's total revenue.