Multiple Choice 6

A receiving report is typically not used for

a. low cost supply items

b. items ordered on blanket purchase orders

c. receipt of services

d. reoccurring items

Multiple Choice 7

The formula for the inventory turnover is _____ divided by the _____.

a. net sales; inventory

b. cost of goods sold; inventory

c. gross margin; inventory

d. none of the above

Multiple Choice 8

Which of the following statements is false?

a. Kickbacks are the most expensive form of employee corruption.

b. RFID technology is more efficient than bar codes.

c. The Bureau of Industry and Security maintains lists of individuals and companies with whom it is

illegal to transact business.

d. Competitive written bids should be solicited for high-cost and specialized products.

e. All of the above.

Multiple Choice 9

The following is (are) a red flag(s) that would identify suppliers likely to represent potential problems:

a. The suppliers address is on the invoices.

b. Entertainment expenses are high in terms of a percentage of the suppliers gross sales.

c. A large percentage of the suppliers gross sales were to one company.

d. A and B

e. B and C

Multiple Choice 10

It is difficult to prevent fraudulent billing for services. One of the most effective techniques is for the _____

function to periodically conduct detailed reviews of contracts for services.

a. CPA firms

b. internal audit

c. internal control

d. accounts payable