With a limited work force and a desire to maintain strong internal control,which combination of duties would result in the lowest risk exposure?
A) updating the inventory subsidiary ledgers and recording purchases in the purchases journal
B) approving a sales return on a customer's account and depositing customers' checks in the bank
C) updating the general ledger and working in the inventory warehouse
D) entering payments to vendors in the cash disbursements journal and entering cash received from customers in the cash receipts journal

Question

Quizplus · Accepted Answer

Option D involves the separation of duties related to cash disbursements and receipts in the company. While one employee enters payments to vendors, another enters cash received from customers, thereby ensuring there is no opportunity for fraud or embezzlement. This helps in maintaining strong internal control and reduces the risk of exposure to the company.

With a Limited Work Force and a Desire to Maintain