1. An accounting information system comprises five generic parts. Which of the following gives an example of an internal control associated with the sales/collection process?'

a) Depositing cash in the bank daily

b) Adequately supervising employees who handle inventory

c) Both depositing cash in the bank daily and adequately supervising employees who handle inventory

d) Neither depositing cash in the bank daily nor adequately supervising employees who handle inventory

2. Consider the following partially completed risk/control matrix as you answer the questions:

Assume the risk/control matrix is organized like the one presented in the chapter. Column A is most closely related to the ___ part of the COSO framework.

Internal control A purpose Risk category Liquidity risk Preventive B Separation of duties Internal audit of shareholder database E Comments Acquisition / payment process G D Detective Credit risk Preventive Dividends paid to the wrong shareholders Sharp increases in bad debts Interest rate increases on adjustable rate debt Sales / collection process H Market risk F Establish and enforce a company policy to only take on fixed rate debt Internal control A purpose Risk category Liquidity risk Preventive B Separation of duties Internal audit of shareholder database E Comments Acquisition / payment process G D Detective Credit risk Preventive Dividends paid to the wrong shareholders Sharp increases in bad debts Interest rate increases on adjustable rate debt Sales / collection process H Market risk F Establish and enforce a company policy to only take on fixed rate debt