5. Having one person responsible for the related activities of ordering merchandise, receiving goods, and paying for them a. increases the potential for errors and fraud. b. decreases the potential for errors and fraud. is an example of good internal control. d. is a good example of safeguarding the company's assets. c. 16. When two or more people get together for the purpose of circumventing prescribed controls, it is called a fraud committee. b. collusion. a division of duties. d. bonding ofemployees. a. c. 17. From an internal control standpoint, the asset most susceptible to improper diversion and use is a. prepaid insurance. b. cash. c. buildings. d. land. In large companies, the independent internal verification procedure is often assigned to 18. computer operators. b. management. c. internal auditors. d. outside CPAS. a. 19. If employees are bonded a. it means that they are not allowed to handle cash. b. they have worked for the company for at least 10 years. c. they have been insured against misappropriation of assets. d. it is impossible for them to steal from the company. 20. Control over cash disbursements is generally more effective when a. all bills are paid in cash. b. disbursements are made by the accounts payable subsidiary clerk. c. payments are made by check. d. all purchases are made on credit. 21. Which of the following would be added to the balance per bank on a bank reconciliation? a. Outstanding checks. b. Deposits in transit. c. Notes collected by the bank. d. Service charges