Internal Control Principles Identify and briefly describe the two principles that should govern the monitoring function
1 . The organization selects, develops, and performs ongoing and/or separate evaluations to ascertain whether the components of internal control are present and functioning.
Ongoing evaluation are procedures built into the normal recurring activities of an entity.Separate evaluations are conducted periodically, typically by objective management personnel, internal auditors, or external consultants.
2 . The organization evaluates and communicates internal control deficiencies in a timely manner to those parties responsible for taking corrective action, including senior management and the board of directors, as appropriate.
Control deficiencies identified through monitoring or other activities need to be communicated to appropriate personnel such as management or the board of directors so that appropriate corrective action can be taken.
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When a company discards machinery that is fully depreciated, this transaction would be recorded with the following entry:
a. debit Accumulated Depreciation; credit Machinery b. debit Machinery; credit Accumulated Depreciation c. debit Cash; credit Accumulated Depreciation d. debit Depreciation Expense; credit Accumulated Depreciation
Clichés are _____________ phrases
a. long b. unclear c. worn-out d. incoherent
What is the purpose of a balanced scorecard?
a. To link capabilities, change strategies, and outcomes b. To integrate measures into the strategy to track critical success factors c. To provide action items for day-to-day execution of the strategy d. To measure risk associated with the strategy
On June 17, 2012, Company A purchases 10,000 shares of Company B's $15 par value, common stock for $200,000 . Company B has 50,000 shares of common stock outstanding. On December 31, 2010, the market price of the stock is $22 per share. Company A's entry to record the stock purchase is:
a. debit Short-Term Investments, $200,000, and credit Cash, $200,000. b. debit Investment in Company B, $200,000, and credit Cash, $200,000. c. debit Long-Term Investments, $150,000; debit Allowance to Adjust Long-Term Investments to Market, $50,000; and credit Cash, $200,000. d. debit Investment in Company B, $150,000; debit Allowance to Adjust Long-Term Investments to Market, $50,000; and credit Cash, $200,000.