WILEY PLUS EXAM 3 QUESTIONS AND
ANSWERS WITH VERIFIED SOLUTIONS
100% CORRECT NEWLY UPDATED 2025
t/f: Internal controls guarantee the accuracy and reliability of the accounting
records. - ANSWER✔✔false
3 reason why an organization establishes a system for internal control? -
ANSWER✔✔-To increase efficiency of operations
-To ensure compliance with laws and regulations
-To safeguard its assets
Collusion - ANSWER✔✔occurs when two or more people work together to get
around the rules and regulations in order to conduct unethical or illegal activities.
who should not perform the record keeping for assets - ANSWER✔✔the person
wiht custody of assets
Internal auditors - ANSWER✔✔evaluate the system of internal controls for the
companies that employ them.
Documentation - ANSWER✔✔the utilization of pre-numbered forms and source
documents.
obtaining insurance protection against dishonest employees an example of what -
ANSWER✔✔bonding
, Reasonable assurance rests on the premise that - ANSWER✔✔the costs of
establishing controls should not exceed their expected benefit
Internal auditors are - ANSWER✔✔company employees who evaluate the
effectiveness of the company's system of internal control on a continuous basis.
For what purpose are physical controls used in a business? - ANSWER✔✔enhance
the accuracy and reliability of its accounting records and to safeguard its assets
not one of the principles of internal control? - ANSWER✔✔financial performance
measures
principles of internal control (3) - ANSWER✔✔-independent interdependent
internal verification
-establishment of responsibility
-documentation procedures
Handly Inc. permits only designated personnel such as cashiers to handle cash
receipts. What principle is being applied? - ANSWER✔✔Establishment of
responsibility
Aptara Construction Supplies has a cashier who is also the accounts receivable
clerk for the company. Which internal control principle is violated? -
ANSWER✔✔Segregation of duties
internal control principle is most important in a control system for handling cash
receipts? - ANSWER✔✔Segregation of duties
ANSWERS WITH VERIFIED SOLUTIONS
100% CORRECT NEWLY UPDATED 2025
t/f: Internal controls guarantee the accuracy and reliability of the accounting
records. - ANSWER✔✔false
3 reason why an organization establishes a system for internal control? -
ANSWER✔✔-To increase efficiency of operations
-To ensure compliance with laws and regulations
-To safeguard its assets
Collusion - ANSWER✔✔occurs when two or more people work together to get
around the rules and regulations in order to conduct unethical or illegal activities.
who should not perform the record keeping for assets - ANSWER✔✔the person
wiht custody of assets
Internal auditors - ANSWER✔✔evaluate the system of internal controls for the
companies that employ them.
Documentation - ANSWER✔✔the utilization of pre-numbered forms and source
documents.
obtaining insurance protection against dishonest employees an example of what -
ANSWER✔✔bonding
, Reasonable assurance rests on the premise that - ANSWER✔✔the costs of
establishing controls should not exceed their expected benefit
Internal auditors are - ANSWER✔✔company employees who evaluate the
effectiveness of the company's system of internal control on a continuous basis.
For what purpose are physical controls used in a business? - ANSWER✔✔enhance
the accuracy and reliability of its accounting records and to safeguard its assets
not one of the principles of internal control? - ANSWER✔✔financial performance
measures
principles of internal control (3) - ANSWER✔✔-independent interdependent
internal verification
-establishment of responsibility
-documentation procedures
Handly Inc. permits only designated personnel such as cashiers to handle cash
receipts. What principle is being applied? - ANSWER✔✔Establishment of
responsibility
Aptara Construction Supplies has a cashier who is also the accounts receivable
clerk for the company. Which internal control principle is violated? -
ANSWER✔✔Segregation of duties
internal control principle is most important in a control system for handling cash
receipts? - ANSWER✔✔Segregation of duties
