It has been discovered that credit sales have been made to customers with a poor credit rating.If this activity continues,the company may face uncollectible sales and losses due to bad debts.What applicable control procedure may help the company to gain control over this situation?

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By requiring credit approval from a credit manager rather than marketing personnel, the company can ensure that credit decisions are made based on the customer's credit rating rather than potential marketing opportunities. This helps to prevent credit sales to customers with a poor credit rating and reduce the risk of uncollectible sales and losses due to bad debts. The other control procedures listed (separation of shipping and billing duties, data entry application controls, price lists) may also be important, but are not as directly related to addressing the issue of credit sales to customers with poor credit ratings.

It Has Been Discovered That Credit Sales Have Been Made