Question

28) Which of the following is not one of the nine features of an internal control system? A) Establishment of clear lines of authority B) Having employees covered by a fidelity bond C) Requiring regular vacations for certain employees D) Customer service comment cards 9. In an inflationary period, which inventory cost flow method, FIFO or LIFO, is more desirable from a tax standpoint? (Meaning the lowest taxes due) A. LIFO B. FIFO C. Specific Identification D. Average Costing

Answer 1

Answer - Opton D. internal control system core 28 The actual mine features of fraud orj Heft requires collurion, U Seperate duties so that (2) toatthy conducting performance evaluations through independent Internal and exlenal audits, (3) Establishing clean lines of authority and responsibility: 14) Establishing proper procedures for processing transactions, (5) Implementing physical controls such as locking coch in asate, (6) Using pre-numbered documents, 7 Hiring and training competent employees. (8) requiring employees to be absent from their jobs so that Italy spenst replacements can discovey cyrors com fraudulent activity that might have occured. (9 Berding plesee Having employees boy fidelity Lond. the above a features, in included are A option A, B and c of the nine features of internal .:option D is not into one control system. 29 or option À is correct. Explanation :- LIPO is more desirable from a tax standpoint because it will assign the smallest amount of cost to ending inventory Cost of goods sold will be higher consequently net income will be lower LIFO is correct, Thanks