Which of the Following Would NOT Represent Good Controls Over

question 127

Multiple Choice

Which of the following would NOT represent good controls over cash disbursements?

• A)Periodically check amounts shown in the debit card and credit card statements against purchase receipts.
• B)The employee verifying the accuracy of the debit card and credit card statements should not also be the employee responsible for actual purchases.
• C)Set maximum purchase limits on debit cards and credit cards.
• D)Employees responsible for making cash disbursements should also be in charge of cash receipts.

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Definitions:

Corporation by Estoppel

A principle where a company is treated as if it were legally incorporated, due to its conduct, even if it failed to complete the formal incorporation process.

Defectively Organized

Pertains to an entity or group that has not been set up correctly according to legal requirements or standards.

Shareholder Manager

An individual who both owns shares in a corporation and actively manages or participates in its governance and operations.

Annual Franchise Fee

A fee paid by franchisees to franchisors, typically on an annual basis, for the right to continue operating under the franchisor's brand and system.