A mail-order retail organization sells complex electronic equipment through its catalogs. Orders are taken over phone lines
Question:
A mail-order retail organization sells complex electronic equipment through its catalogs. Orders are taken over phone lines and transmitted via terminal to the company's main warehouse for processing, shipping, and invoicing. Which of the following would be the most effective control procedure to ensure that proper in- ventory items are identified and shipped?
a. Require use of self-checking digits on the customer's account number.
b. Require oral verification of part description and price with the customer over the phone.
c. Require sales order personnel to verify that inventory items are on hand by re- ferring to current inventory quantities before processing the order.
d. Require use of batch control totals to reconcile total amount ordered by ter- minal with total amount recorded in the inventory file for the same period.
Step by Step Answer:
Auditing Concepts For A Changing Environment
ISBN: 9781284249286
5th Edition
Authors: Larry E. Rittenberg, Bradley J. Schwieger