A security guard at a Wal-Mart costs about $28,000 a year. On average, each guard prevents about $50,000 of theft. Which of the following internal control concepts does this illustrate?
A) Proper authorization
B) Competent, reliable, and ethical personnel
C) Separation of duties
D) Cost/benefit relationship

Question

Quizplus · Accepted Answer

The scenario illustrates the cost/benefit relationship concept in internal controls, where the cost of implementing a control (hiring a security guard) is justified by the benefit it brings (preventing theft), showing that the benefits outweigh the costs.

A Security Guard at a Wal-Mart Costs About $28,000 a Year