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JAMB Principles of Accounts 1998 Question 4

Question 4

Source Documents

An advantage of the use of the voucher system is that it

  1. A.reduces the number of cheques that will be written during any given period
  2. B.provides a highly flexible system for handling unusual transactions
  3. C.provides a comprehensive record of business done with particular suppliers
  4. D.ensures that every expenditure is reviewed and verified before payment is made.
Show the answer and explanation

Answer: D (ensures that every expenditure is reviewed and verified before payment is made.)

Explanation

Under a voucher system each payment needs an approved voucher, so every expense is checked before it is paid.