What financial regulation is applied to cash advance items in a funeral establishment?

The regulation that applies to cash advance items in a funeral establishment is that they cannot exceed actual cost. This means that any cash advance items that a funeral home purchases on behalf of a family—such as transportation, cemetery fees, or other related services—must reflect the actual costs incurred by the funeral home and cannot include added profits or markups.

This regulation helps to ensure transparency and fairness in funeral service pricing, protecting consumers from inflated charges. The funeral establishment acts as a facilitator, passing on the exact cost of these services to the families, which promotes ethical practices within the industry.

The other options either suggest practices that could lead to additional costs for families or are not aligned with the regulatory framework governing cash advance items.