The use of a lockbox system enhances controls over cash receipts because the post office box is directly controlled by the:
A) mailroom staff.
B) internal audit department.
C) treasurer.
D) chief financial officer.
E) company's bank.

Question

Quizplus · Accepted Answer

The use of a lockbox system enhances controls over cash receipts by having payments mailed directly to a post office box that is controlled by the company's bank. This arrangement minimizes the handling of checks by company employees and speeds up the deposit process, thereby reducing the risk of theft or misappropriation of funds.

The Use of a Lockbox System Enhances Controls Over Cash