Question 1

Bank errors

Accepted Answer

A)  occur because of time lags. 
B)  must be corrected by debits. 
C)  must be corrected by the bank. 
D)  are corrected by making an adjusting entry on the depositor's books. 
A)  occur because of time lags. 
B)  must be corrected by debits. 
C)  must be corrected by the bank. 
D)  are corrected by making an adjusting entry on the depositor's books.

Question 2

Which of the following is NOT a party to a cheque?

Accepted Answer

A)  maker 
B)  buyer 
C)  payee 
D)  bank 
A)  maker 
B)  buyer 
C)  payee 
D)  bank

Question 3

Match the items below by entering the appropriate, many companies combine cash with

Accepted Answer

A)  cash equivalents. 
B)  bank overdrafts. 
C)  short-term investments. 
D)  accounts receivable. 
A)  cash equivalents. 
B)  bank overdrafts. 
C)  short-term investments. 
D)  accounts receivable.

Question 4

A deposit made by a company will appear on the bank statement as a

Accepted Answer

A)  debit. 
B)  credit. 
C)  debit memorandum. 
D)  credit memorandum. 
A)  debit. 
B)  credit. 
C)  debit memorandum. 
D)  credit memorandum.

Question 5

Internal control is a process that helps an organization achieve reliable financial reporting.

Accepted Answer

A) True 
 B)False

Question 6

The person who handles the cash and makes the bank deposit should NOT be able to make changes to the sales record in the point-of-sale system.

Accepted Answer

A) True 
 B)False

Question 7

Cash lacks owner identification.

Accepted Answer

A) True 
 B)False

Question 8

An effective control framework will NOT contain which of the following components?

Accepted Answer

A)  risk assessment 
B)  monitoring 
C)  fraud committee 
D)  information and communication 
A)  risk assessment 
B)  monitoring 
C)  fraud committee 
D)  information and communication

Question 9

An adjusting entry is NOT required for

Accepted Answer

A)  outstanding cheques. Replace? The term was deleted from the chapter and its Glossary 
B)  EFT collections. 
C)  NSF cheques. 
D)  bank service charges. 
A)  outstanding cheques. Replace? The term was deleted from the chapter and its Glossary 
B)  EFT collections. 
C)  NSF cheques. 
D)  bank service charges.

Question 10

A company's cash deposit, while appearing as a debit on the company's books, would be shown as a credit on company's bank statement.

Accepted Answer

A) True 
 B)False

Question 11

The responsibility for keeping the records for an asset should be separate from the physical custody of that asset.

Accepted Answer

A) True 
 B)False

Question 12

Two individuals at a retail store work the same cash register. You evaluate this situation as

Accepted Answer

A)  a violation of establishment of responsibility. 
B)  a violation of segregation of duties. 
C)  supporting the establishment of responsibility. 
D)  supporting independent checks of performance. 
A)  a violation of establishment of responsibility. 
B)  a violation of segregation of duties. 
C)  supporting the establishment of responsibility. 
D)  supporting independent checks of performance.

Question 13

An employee authorized to sign cheques should NOT record

Accepted Answer

A)  owner cash contributions. 
B)  mail receipts. 
C)  cash payment transactions. 
D)  sales transactions. 
A)  owner cash contributions. 
B)  mail receipts. 
C)  cash payment transactions. 
D)  sales transactions.

Question 14

The Sarbanes Oxley will have little impact on Canadian companies as it is legislation enacted in the United States.

Accepted Answer

A) True 
 B)False

Question 15

The internal audit function is only effective when

Accepted Answer

A)  control tasks are properly performed. 
B)  the results of an internal audit are reported to senior management and/or the company's owners. 
C)  independent checks of performance are carried out on a regular basis. 
D)  reports are filed with the CICA. 
A)  control tasks are properly performed. 
B)  the results of an internal audit are reported to senior management and/or the company's owners. 
C)  independent checks of performance are carried out on a regular basis. 
D)  reports are filed with the CICA.

Question 16

The following information is taken from the accounting records of Village Pet Shelter at December 31, 2014, the organization's year end:
1. The organization owned $50,000 in guaranteed investment certificates due June 30, 2015.
2. The Bank of Montreal chequing account balance was $4,566 after all adjusting entries had been made.
3. The Bank of Montreal savings account balance was $35,600 before recording $150 in December interest revenue.
4. The Bank of Nova Scotia Chequing account balance, after all adjustments, is $80,700. The funds in this account were donated by a private foundation for the purpose of purchasing new shelter furnishings, which they plan to do in February, 2015.
Instructions
Prepare a partial balance sheet for Village Pet Shelter at December 31 showing how this information should be presented.

Accepted Answer

The answer of The following information is taken from the...

Question 17

An accounts payable clerk also has access to the approved supplier master file for purchases. The control activity

Accepted Answer

A)  establishment of responsibility is violated. 
B)  independent check of performance is violated. 
C)  documentation procedures is violated. 
D)  segregation of duties is violated. 
A)  establishment of responsibility is violated. 
B)  independent check of performance is violated. 
C)  documentation procedures is violated. 
D)  segregation of duties is violated.

Question 18

Which one of the following items would NOT be considered cash?

Accepted Answer

A)  coins 
B)  money orders 
C)  currency 
D)  postdated cheques 
A)  coins 
B)  money orders 
C)  currency 
D)  postdated cheques

Question 19

Sales using debit cards are considered "cash" transactions.

Accepted Answer

A) True 
 B)False

Question 20

Bank service charges are normally debited to Bank Charges Expense.

Accepted Answer

A) True 
 B)False

Bank errors

Which of the following is NOT a party to a cheque?

Match the items below by entering the appropriate, many companies combine cash with

A deposit made by a company will appear on the bank statement as a

Internal control is a process that helps an organization achieve reliable financial reporting.

The person who handles the cash and makes the bank deposit should NOT be able to make changes to the sales record in the point-of-sale system.

Cash lacks owner identification.

An effective control framework will NOT contain which of the following components?

An adjusting entry is NOT required for

A company's cash deposit, while appearing as a debit on the company's books, would be shown as a credit on company's bank statement.

The responsibility for keeping the records for an asset should be separate from the physical custody of that asset.

Two individuals at a retail store work the same cash register. You evaluate this situation as

An employee authorized to sign cheques should NOT record

The Sarbanes Oxley will have little impact on Canadian companies as it is legislation enacted in the United States.

The internal audit function is only effective when

An accounts payable clerk also has access to the approved supplier master file for purchases. The control activity

Which one of the following items would NOT be considered cash?

Sales using debit cards are considered "cash" transactions.

Bank service charges are normally debited to Bank Charges Expense.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completion of the Accounting Cycle

Accounting for Merchandising Operations

Inventory Costing

Long-Lived Assets

Current Liabilities

Accounting Principles

Accounting for Partnerships

Introduction to Corporations

Corporations: Additional Topics and Ifrs

Non-Current Liabilities

The Cash Flow Statement

Financial Statement Analysis

Investments

Filters

Exam 7: Internal Control and Cash

Bank errors

Which of the following is NOT a party to a cheque?

Match the items below by entering the appropriate, many companies combine cash with

A deposit made by a company will appear on the bank statement as a

Internal control is a process that helps an organization achieve reliable financial reporting.

The person who handles the cash and makes the bank deposit should NOT be able to make changes to the sales record in the point-of-sale system.

Cash lacks owner identification.

An effective control framework will NOT contain which of the following components?

An adjusting entry is NOT required for

A company's cash deposit, while appearing as a debit on the company's books, would be shown as a credit on company's bank statement.

The responsibility for keeping the records for an asset should be separate from the physical custody of that asset.

Two individuals at a retail store work the same cash register. You evaluate this situation as

An employee authorized to sign cheques should NOT record

The Sarbanes Oxley will have little impact on Canadian companies as it is legislation enacted in the United States.

The internal audit function is only effective when

An accounts payable clerk also has access to the approved supplier master file for purchases. The control activity

Which one of the following items would NOT be considered cash?

Sales using debit cards are considered "cash" transactions.

Bank service charges are normally debited to Bank Charges Expense.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completion of the Accounting Cycle

Accounting for Merchandising Operations

Inventory Costing

Long-Lived Assets

Current Liabilities

Accounting Principles

Accounting for Partnerships

Introduction to Corporations

Corporations: Additional Topics and Ifrs

Non-Current Liabilities

The Cash Flow Statement

Financial Statement Analysis

Investments

Filters