Exam 6: Cash and Internal Control

The audit committee of the board of directors provides direct contact between the ______________________________ and the ________________________________________.

Which of the following represents a group composed of key officers of a corporation and outside members responsible for the general oversight of the affairs of the company?

Which one of the following items would be added to the balance per bank statement in a bank reconciliation?

The following set of items describes activities completed by a company in purchasing and paying for merchandise.For each activity, identify whether or not the activity adheres to or violates sound internal control procedures. All documents attached to an invoice approval form are canceled before a check is signed.

Only one copy of the prelist should be prepared when an employee opens mail with customer payments to avoid complexity in the accounting system and maintain control.

Which internal control procedure is violated when the cashier at the checkout stand also records the daily receipts in the journal?

The following set of items describes activities completed by a company in collecting cash for merchandise sales.For each activity, identify whether or not the activity adheres to or violates sound internal control procedures. A single employee in the mailroom opens the mail, counts the money received, and prepares a control list of the amount received.

On a bank reconciliation, outstanding checks are added to the cash balance per the bank statement.

An advantage of a strong system of internal control is that less testing of the accounting system is done by the outside auditors.

A company prepares adjusting entries for debit memorandums but not for credit memorandums.

An outstanding check is a check that:

Which one of the following statements is true?

How would interest earned on a checking account be dealt with in a bank reconciliation?

A check that is returned or "bounces" because of insufficient funds is called an) .

Petty cash typically is composed of coins and currency kept on hand in a business to make minor disbursements.

Which one of the following is not a generally recognized internal control procedure?

Which one of the following is considered one of the six most important categories of internal control procedures?

No special internal control procedures are necessary with a petty cash account because the amount is usually so small.

On a bank reconciliation, interest earned for the month is added to the cash balance per the books.

Which one of the following procedures is not part of preparing a bank reconciliation of a checking account