Having one person responsible for the related activities of ordering merchandise, receiving goods, and paying for them: a) increases the potential for errors and fraud

The correct option is a. increases the potential for errors and fraud.

Reason: This option is correct because if an individual person is responsible for related activities of ordering merchandise, receiving goods and paying for them then it might be possible that individual take undue advantage of authority and might involve in inventory theft and it is also possible due to work load there might be errors.

Explanation for incorrect options:

b) Decrease in potential for errors and fraud.

Reason: When one individual is made responsible for various related activities then in such case the chances of errors and potential frauds increases rather than decreasing.

c) is an example of goods internal control.

Reason: It is not an example of goods internal control because under good internal control multiple persons are assigned.

d) Is a good example of safeguarding the company's assets.

Reason: This option is incorrect because if one individual is made responsible for various activities than it might be possible that person will get involve in theft activity.