Question 1

What are some of the limitations on a company's effective system of internal control?

Accepted Answer

There are a number of limitations on the

Question 2

In the reconciliation of a bank statement, "deposits in transit" should be:

Accepted Answer

A)  added to the unadjusted book balance. 
B)  subtracted from the unadjusted bank balance. 
C)  added to the unadjusted bank balance 
D)  subtracted from the unadjusted bank balance 
A)  added to the unadjusted book balance. 
B)  subtracted from the unadjusted bank balance. 
C)  added to the unadjusted bank balance 
D)  subtracted from the unadjusted bank balance

Question 3

Use the following data to answer the question presented below for Raines Corp.'s preparation of a bank reconciliation on October 31, 2014:

Accepted Answer

The answer of Use the following data to answer the...

Question 4

Which of the following is not considered a business source document?

Accepted Answer

A)  Time card 
B)  Purchase order 
C)  Sales invoice 
D)  Schedule listing all the insurance policies in force 
A)  Time card 
B)  Purchase order 
C)  Sales invoice 
D)  Schedule listing all the insurance policies in force

Question 5

Match the action with the category of internal control procedures
-Segregation of duties

Accepted Answer

A) One department should check on another 
B) Internal audit staff ensure all is working as intended 
C) Accounting and cash collection is properly separated 
D) Blank checks are locked at all times when not in use 
E) Origination of initial entry into accounting system
F)Specific authority is given by management for the performance of activities. 
A) One department should check on another 
B) Internal audit staff ensure all is working as intended 
C) Accounting and cash collection is properly separated 
D) Blank checks are locked at all times when not in use 
E) Origination of initial entry into accounting system
F)Specific authority is given by management for the performance of activities.

Question 6

If a company has internal auditors, it does not need to have external auditors.

Accepted Answer

A) True 
 B)False

Question 7

The IFRS definition of cash equivalents is very similar to that used by .

Accepted Answer

The answer of The IFRS definition of cash equivalents is...

Question 8

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.
An employee in the accounting department records cash receipts from customers and prepares a bank deposit slip.

Accepted Answer

A)  Adheres to sound internal control procedures 
B)  Violates sound internal control procedures 
C)  Neither strengthens nor violates internal control 
A)  Adheres to sound internal control procedures 
B)  Violates sound internal control procedures 
C)  Neither strengthens nor violates internal control

Question 9

Which internal control procedure is followed when storage areas are secured with limited access?

Accepted Answer

A)  Segregation duties 
B)  Safeguarding assets and records 
C)  Independent verifications 
D)  Proper authorizations 
A)  Segregation duties 
B)  Safeguarding assets and records 
C)  Independent verifications 
D)  Proper authorizations

Question 10

When reconciling a bank account, the company must prepare an adjusting entry for deposits in transit.

Accepted Answer

A) True 
 B)False

Question 11

For the following items Questions 220-227, indicate whether each should be a included or b excluded from the line item titled Cash and cash equivalents on the balance sheet.
-Checking account

Accepted Answer

A) Included 
B) Excluded 
A) Included 
B) Excluded

Question 12

If a company records a $310 receipt as $130, this type of error is called an .

Accepted Answer

The answer of If a company records a $310 receipt...

Question 13

The use of customer statements as a control device will be effective only if the employees responsible for the custody of cash received through the mail, for record keeping, and for authorization of adjustments to customers' accounts are not allowed to prepare and mail statements to customers.

Accepted Answer

A) True 
 B)False

Question 14

For the following items Questions 220-227, indicate whether each should be a included or b excluded from the line item titled Cash and cash equivalents on the balance sheet.
-Certificate of deposit maturing in 60 days

Accepted Answer

A) Included 
B) Excluded 
A) Included 
B) Excluded

Question 15

Given the following items, what amount should be reported on the balance sheet as Cash and cash equivalents?

Accepted Answer

$5,000 + $5,500 + $1

Question 16

Latahmer Corporation is reconciling its May bank account. For each item listed, state how it would be handled on the bank reconciliation.
-Customer's NSF check is returned with the bank statement

Accepted Answer

A) Addition to bank balance 
B) Subtraction from bank balance 
C) Addition to book balance 
D) Subtraction from book balance 
E) Would not appear on the May reconciliation 
A) Addition to bank balance 
B) Subtraction from bank balance 
C) Addition to book balance 
D) Subtraction from book balance 
E) Would not appear on the May reconciliation

Question 17

Cash equivalents are investments that are readily convertible to a known amount of cash, where readily means six months or less.

Accepted Answer

A) True 
 B)False

Question 18

Match the following terms with the best definitions for questions 212 through 219.
-Used to prepare a purchase order.

Accepted Answer

A) Purchase requisition. 
B) Receiving Report. 
C) Vendor Invoice. 
D) Check. 
E) Control procedures.
F)Inventory count.
G)Segregation of duties.
H)Source document control. 
A) Purchase requisition. 
B) Receiving Report. 
C) Vendor Invoice. 
D) Check. 
E) Control procedures.
F)Inventory count.
G)Segregation of duties.
H)Source document control.

Question 19

According to the Sarbanes-Oxley Act of 2002, only external auditors can provide bookkeeping services for the clients they audit.

Accepted Answer

A) True 
 B)False

Question 20

How are cash equivalents reported or disclosed in the financial statements?

Accepted Answer

A)  They appear only on the statement of cash flows. 
B)  They are included with short-term investments under current assets on the balance sheet. 
C)  They are included with cash under current assets on the balance sheet. 
D)  They are disclosed only in a footnote to the balance sheet. 
A)  They appear only on the statement of cash flows. 
B)  They are included with short-term investments under current assets on the balance sheet. 
C)  They are included with cash under current assets on the balance sheet. 
D)  They are disclosed only in a footnote to the balance sheet.

What are some of the limitations on a company's effective system of internal control?

In the reconciliation of a bank statement, "deposits in transit" should be:

Use the following data to answer the question presented below for Raines Corp.'s preparation of a bank reconciliation on October 31, 2014:

Which of the following is not considered a business source document?

Match the action with the category of internal control procedures -Segregation of duties

If a company has internal auditors, it does not need to have external auditors.

The IFRS definition of cash equivalents is very similar to that used by .

Which internal control procedure is followed when storage areas are secured with limited access?

When reconciling a bank account, the company must prepare an adjusting entry for deposits in transit.

For the following items Questions 220-227, indicate whether each should be a included or b excluded from the line item titled Cash and cash equivalents on the balance sheet. -Checking account

If a company records a $310 receipt as $130, this type of error is called an .

The use of customer statements as a control device will be effective only if the employees responsible for the custody of cash received through the mail, for record keeping, and for authorization of adjustments to customers' accounts are not allowed to prepare and mail statements to customers.

For the following items Questions 220-227, indicate whether each should be a included or b excluded from the line item titled Cash and cash equivalents on the balance sheet. -Certificate of deposit maturing in 60 days

Given the following items, what amount should be reported on the balance sheet as Cash and cash equivalents?

Latahmer Corporation is reconciling its May bank account. For each item listed, state how it would be handled on the bank reconciliation. -Customer's NSF check is returned with the bank statement

Cash equivalents are investments that are readily convertible to a known amount of cash, where readily means six months or less.

Match the following terms with the best definitions for questions 212 through 219. -Used to prepare a purchase order.

According to the Sarbanes-Oxley Act of 2002, only external auditors can provide bookkeeping services for the clients they audit.

How are cash equivalents reported or disclosed in the financial statements?

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Receivables and Investments

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International-Financial-Reporting-Standards

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Exam 6: Cash and Internal Control

What are some of the limitations on a company's effective system of internal control?

In the reconciliation of a bank statement, "deposits in transit" should be:

Use the following data to answer the question presented below for Raines Corp.'s preparation of a bank reconciliation on October 31, 2014:

Which of the following is not considered a business source document?

Match the action with the category of internal control procedures -Segregation of duties

If a company has internal auditors, it does not need to have external auditors.

The IFRS definition of cash equivalents is very similar to that used by .

Which internal control procedure is followed when storage areas are secured with limited access?

When reconciling a bank account, the company must prepare an adjusting entry for deposits in transit.

For the following items Questions 220-227, indicate whether each should be a included or b excluded from the line item titled Cash and cash equivalents on the balance sheet. -Checking account

If a company records a $310 receipt as $130, this type of error is called an .

The use of customer statements as a control device will be effective only if the employees responsible for the custody of cash received through the mail, for record keeping, and for authorization of adjustments to customers' accounts are not allowed to prepare and mail statements to customers.

For the following items Questions 220-227, indicate whether each should be a included or b excluded from the line item titled Cash and cash equivalents on the balance sheet. -Certificate of deposit maturing in 60 days

Given the following items, what amount should be reported on the balance sheet as Cash and cash equivalents?

Latahmer Corporation is reconciling its May bank account. For each item listed, state how it would be handled on the bank reconciliation. -Customer's NSF check is returned with the bank statement

Cash equivalents are investments that are readily convertible to a known amount of cash, where readily means six months or less.

Match the following terms with the best definitions for questions 212 through 219. -Used to prepare a purchase order.

According to the Sarbanes-Oxley Act of 2002, only external auditors can provide bookkeeping services for the clients they audit.

How are cash equivalents reported or disclosed in the financial statements?

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Receivables and Investments

Operating Assets: Property, Plant, and Equipment, and Intangibles

Current Liabilities, Contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International-Financial-Reporting-Standards

Filters