A good internal control to protect cash is to make cash payments usingMultiple choice question.checks or cashpetty cashcheckscash

Answer Explanation

To protect cash and ensure proper internal control, using checks for cash payments is generally considered a better option compared to cash or petty cash. Here’s a detailed explanation:

1. Checks Provide a Paper Trail: When payments are made with checks, there is a documented record of the transaction. This record can be tracked through bank statements, making it easier to reconcile accounts and audit transactions.

2. Prevents Theft: Using checks reduces the amount of cash on hand, thus minimizing the risk of theft or misappropriation. Cash can easily be lost or stolen, whereas checks offer a more secure alternative that can be canceled if lost or stolen.

3. Control Over Disbursements: Checks require that funds be transferred through the banking system, which adds a layer of control. It ensures that cash is only released as intended and can include an authorization process before payment.

4. Segregation of Duties: In many organizations, checks must be signed by authorized personnel, which helps in establishing accountability. This is vital for preventing fraud, as it limits the number of individuals who have access to cash and can approve disbursements.

Final Answer

The best option to protect cash through internal controls is to make cash payments using checks.