Accounting7212

User Generated

Znany1488

Business Finance

Question Description

I'm working on a accounting multi-part question and need an explanation and answer to help me learn.


Q2.Why is it important for companies to implement good internal control? What are the principles of internal control? Explain your answer.

Q3. A company wants to use the allowance method to account for bad debts. You are assigned to explain to the company the different ways it can use to estimate bad debts.         

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Explanation & Answer

View attached explanation and answer. Let me know if you have any questions.

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Q2
Internal control is important for companies to improve their accounting and internal
control processes by preventing financial misstatement. By implementing good internal control,
it will help in controlling fraud, and enhancing the efficiency of an organization. The principles
of internal control are: Activities of individuals must be reconciled, instructions must be created
to minimize error, transactions or events must pass qualitative test of representation, and records
must be maintained appropriately and maintained in accordance with the established policy or
procedure.
Internal control ensures the integrity of transactions, documents and records and it
protects the assets of your company. The principles of internal control are: prevention, detection
and reporting. Prevention is ensuring everything related to internal control is in place ...

Whyborfb (12565)
University of Virginia

Anonymous
Really helpful material, saved me a great deal of time.

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