NAF Final Exam UPDATED ACTUAL
QUESTIONS AND CORRECT ANSWERS
Strong Leadership and Culture of Integrity (Internal Control) - CORRECT
ANSWER Managers being honest so their employees are also honest
Security of Assets (Internal Control) - CORRECT ANSWER Supervising cashiers and
having a cash register with tape.
Why do Companies need (Internal Controls)? - CORRECT ANSWER To avoid
stealing, have accurate reports of financial data, and to protect their assets.
Segregation of Duties (Internal Control) - CORRECT ANSWER An employee that
handles cash doesn't also record the amount of cash in the journal.
Independent Verification (Internal Control) - CORRECT ANSWER Rotating duties so
employees can check each other's work and identify any mistakes.
LLC (Business Forms) - CORRECT ANSWER A business form that combines the
limited liability of a corporation with the tax benefits of a sole proprietorship.
How many people can own a corporation? (Business Forms) - CORRECT
ANSWER One or more people
Advantages of a Corporation (Business Forms) - CORRECT ANSWER Limited
personal liability
Management expertise
Easier to raise capital
Easy to sell
Unlimited life
QUESTIONS AND CORRECT ANSWERS
Strong Leadership and Culture of Integrity (Internal Control) - CORRECT
ANSWER Managers being honest so their employees are also honest
Security of Assets (Internal Control) - CORRECT ANSWER Supervising cashiers and
having a cash register with tape.
Why do Companies need (Internal Controls)? - CORRECT ANSWER To avoid
stealing, have accurate reports of financial data, and to protect their assets.
Segregation of Duties (Internal Control) - CORRECT ANSWER An employee that
handles cash doesn't also record the amount of cash in the journal.
Independent Verification (Internal Control) - CORRECT ANSWER Rotating duties so
employees can check each other's work and identify any mistakes.
LLC (Business Forms) - CORRECT ANSWER A business form that combines the
limited liability of a corporation with the tax benefits of a sole proprietorship.
How many people can own a corporation? (Business Forms) - CORRECT
ANSWER One or more people
Advantages of a Corporation (Business Forms) - CORRECT ANSWER Limited
personal liability
Management expertise
Easier to raise capital
Easy to sell
Unlimited life
