Question 1

For which of the following errors should the appropriate amount be added to the balance per books on a bank reconciliation?

Accepted Answer

A)  Check written for $63, but recorded as $36. 
B)  Deposit of $600 recorded by bank as $60. 
C)  A returned $300 check recorded by bank as $30. 
D)  Check written for $57, but recorded as $75. 
A)  Check written for $63, but recorded as $36. 
B)  Deposit of $600 recorded by bank as $60. 
C)  A returned $300 check recorded by bank as $30. 
D)  Check written for $57, but recorded as $75.

Question 2

The following information was taken from Molina Company cash budget for the month of November: $$\begin{array} { l l } 
\text { Beginning cash balance } & \$ 96,000 \
\text { Cash receipts } & 116,000 \
\text { Cash disbursements } & 160,000
\end{array}$$ If the company has a policy of maintaining an end-of-the-month cash balance of $80,000, the amount the company would have to borrow is

Accepted Answer

A)  $44,000. 
B)  $0. 
C)  $28,000. 
D)  $80,000. 
A)  $44,000. 
B)  $0. 
C)  $28,000. 
D)  $80,000.

Question 3

Which statement regarding negative cash balances is true?

Accepted Answer

A)  The amount is offset against other current assets because users need to know net current assets. 
B)  The amount is shown as a current liability because a company cannot have a cash balance below zero. 
C)  The company must obtain a loan to bring the cash balance to zero before financial statements are prepared. 
D)  The negative cash balance is included as a current asset and discussed in a footnote to the financial statements. 
A)  The amount is offset against other current assets because users need to know net current assets. 
B)  The amount is shown as a current liability because a company cannot have a cash balance below zero. 
C)  The company must obtain a loan to bring the cash balance to zero before financial statements are prepared. 
D)  The negative cash balance is included as a current asset and discussed in a footnote to the financial statements.

Question 4

Ron Jones has been a trusted employee for over 10 years. He is responsible for ordering merchandise inventory, receiving the inventory items, and authorizing the payment for these items. Which internal control principle, if any, is being violated?

Accepted Answer

A)  None, Ron has proven to be trustworthy and has enough experience to do a good job. 
B)  Documentation procedures. 
C)  Establishment of responsibilities. 
D)  Segregation of duties. 
A)  None, Ron has proven to be trustworthy and has enough experience to do a good job. 
B)  Documentation procedures. 
C)  Establishment of responsibilities. 
D)  Segregation of duties.

For which of the following errors should the appropriate amount be added to the balance per books on a bank reconciliation?

Which statement regarding negative cash balances is true?

Ron Jones has been a trusted employee for over 10 years. He is responsible for ordering merchandise inventory, receiving the inventory items, and authorizing the payment for these items. Which internal control principle, if any, is being violated?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments and Acquisitions in Accounting

Filters

Exam 7: Fraud, Internal Control, and Cash

For which of the following errors should the appropriate amount be added to the balance per books on a bank reconciliation?

Which statement regarding negative cash balances is true?

Ron Jones has been a trusted employee for over 10 years. He is responsible for ordering merchandise inventory, receiving the inventory items, and authorizing the payment for these items. Which internal control principle, if any, is being violated?

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments and Acquisitions in Accounting

Filters