The Cost Accounting Function Determines Product Costs, Costs of Goods

Multiple Choice

The cost accounting function determines product costs, costs of goods sold, and inventory values for financial reporting purposes and management reporting. What is a sample control activity that could be used to control for inadequate product cost recording that may result in error, fraud, or financial losses?

A) Document and authorize product cost accounting procedures that describe costing methods.
B) Use a BOM for every product in all steps of production.
C) Implement change management and supporting IT general controls.
D) Ensure that system development is reviewed by appropriate IT and accounting staff.