Exam 6: Fraud, Internal Control, and Cash

The following credit sales are budgeted by Gonzalez Company: January \ 170,000 February 250,000 March 350,000 The company's past experience indicates that 80% of the accounts receivable are collected in the month of sale, 20% in the month following the sale. The anticipated cash inflow for the month of March is

The cash receipts section of a cash budget includes all of the following except

Nilson Company gathered the following reconciling information in preparing its August bank reconciliation: The adjusted cash balance per books on August 31 is

From an internal control standpoint, the asset most susceptible to improper diversion and use is

All of the following are true regarding bank statements except

In the month of May, Lopat Company Inc. wrote checks in the amount of $74,000. In June, checks in the amount of $101,264 were written. In May, $67,744 of these checks were presented to the bank for payment, and $87,064 in June. What is the amount of outstanding checks at the end of May?

A system of internal control

Petersen Company is preparing a cash budget for September. The company's cash balance on September 1 is $23,200. The company anticipates cash receipts of $111,800 and cash disbursements of $117,320. If Petersen desires a cash balance of $24,000, it must

Sound internal control activities dictate that the amount of cash on hand should be kept to a maximum.

For efficiency of operations and better control over cash, a company should maintain only one bank account.

An effective system of internal control centralizes functions in a single capable individual.

Which of the following would be deducted from the balance per books on a bank reconciliation?

A $250 petty cash fund has cash of $25 and receipts of $200. The journal entry to replenish the account would include a credit to

In the month of November Gavin Company Inc. wrote checks in the amount of $46,250. In December, checks in the amount of $63,290 were written. In November, $42,340 of these checks were presented to the bank for payment, and $54,415 in December. What is the amount of outstanding checks at the end of December?

Ferguson Company is preparing a cash budget for September. The company's cash balance on September 1 is $34,800. The company anticipates cash receipts of $167,700 and cash disbursements of $175,980. If Ferguson desires a cash balance of $36,000, it must

Which of the following is not an internal control procedure for cash?

To obtain maximum benefit from a bank reconciliation, the reconciliation should be prepared by the employee authorized to sign checks.

Supervisors counting cash receipts daily is an example of

Sam's Grocery Store has the following policy. 'Only one cashier can have access to a cash drawer.' Which internal control principle supports this policy?

Each of the following is a feature of internal control except