Transaction authorisation within an organisation may be either specific or general. An example of specific transaction authorisation is the:
A) setting of automatic reorder points for material or merchandise.
B) approval of a detailed construction budget for a warehouse.
C) establishment of requirements to be met in determining a customer's credit limits.
D) establishment of sales prices for products to be sold to any customer.

Question

Quizplus · Accepted Answer

Approval of a detailed construction budget for a warehouse is a specific transaction authorization as it is limited to a particular project and is not a routine or general practice. Option A is an example of routine or automated authorization, while options C and D are related to general authorization as they set a policy for credit limits and sales prices for all customers.

Transaction Authorisation Within an Organisation May Be Either Specific or General