Question 1

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

Accepted Answer

A) Service charges 
B) Outstanding checks 
C) Deposits in transit 
D) Notes collected by the bank 
A) Service charges 
B) Outstanding checks 
C) Deposits in transit 
D) Notes collected by the bank

Question 2

A check drawn by a depositor for $810 in payment of a liability was recorded by the depositor as $180.The $630 difference would be included on the bank reconciliation as a(n):

Accepted Answer

A) addition to the cash balance per books. 
B) addition to the cash balance per bank. 
C) deduction from the cash balance per bank. 
D) deduction from the cash balance per books. 
A) addition to the cash balance per books. 
B) addition to the cash balance per bank. 
C) deduction from the cash balance per bank. 
D) deduction from the cash balance per books.

Question 3

Accompanying the bank statement was a debit memorandum for an NSF check received from a customer.This item would require an adjusting entry including a:

Accepted Answer

A) debit to Accounts Receivable. 
B) debit to Cash. 
C) debit to Accounts Payable. 
D) credit to Accounts Payable. 
A) debit to Accounts Receivable. 
B) debit to Cash. 
C) debit to Accounts Payable. 
D) credit to Accounts Payable.

Question 4

a)	Where are cash equivalents disclosed in the financial statements?
(b)	List three examples of cash equivalents.

Accepted Answer

(a)Cash account on the balance

Question 5

In preparing a bank reconciliation,the amount of a canceled check omitted from the depositor's records is deducted from the cash balance per books.

Accepted Answer

A) True 
 B)False

Question 6

Employee fraud is the intentional act of deceiving an employer for personal gain.

Accepted Answer

A) True 
 B)False

Question 7

A check drawn by a depositor for $915 in payment of a liability was recorded in the depositor's book as $195.What adjustment is required in the depositor's accounts?

Accepted Answer

A) Decrease Accounts Payable; decrease Cash 
B) Increase Cash; decrease Accounts Receivable 
C) Increase Cash; increase Accounts Payable 
D) Increase Accounts Receivable; decrease Cash 
A) Decrease Accounts Payable; decrease Cash 
B) Increase Cash; decrease Accounts Receivable 
C) Increase Cash; increase Accounts Payable 
D) Increase Accounts Receivable; decrease Cash

Question 8

Receipts from cash sales of $7,500 were recorded incorrectly by the depositor as $5,700.What adjustment is required in the bank's accounts?

Accepted Answer

A) Decrease Sales; decrease Cash 
B) Increase Cash; decrease Accounts Receivable 
C) Increase Cash; increase Sales 
D) No adjustment needed 
A) Decrease Sales; decrease Cash 
B) Increase Cash; decrease Accounts Receivable 
C) Increase Cash; increase Sales 
D) No adjustment needed

Question 9

There are only two internal control objectives: to ensure accurate financial reports,and to ensure compliance with applicable laws.

Accepted Answer

A) True 
 B)False

Question 10

Receipts from cash sales of $5,700 were recorded incorrectly by the depositor as $7,500.The $1,800 difference would be included on the bank reconciliation as a(n):

Accepted Answer

A) addition to the cash balance per books. 
B) addition to the cash balance per bank. 
C) deduction from the cash balance per bank. 
D) deduction from the cash balance per books. 
A) addition to the cash balance per books. 
B) addition to the cash balance per bank. 
C) deduction from the cash balance per bank. 
D) deduction from the cash balance per books.

Question 11

What adjustment is required in the depositor's accounts to record outstanding checks?

Accepted Answer

A) None 
B) Increase Cash; decrease Accounts Receivable 
C) Increase Cash; increase Accounts Payable 
D) Increase Accounts Receivable; decrease Cash 
A) None 
B) Increase Cash; decrease Accounts Receivable 
C) Increase Cash; increase Accounts Payable 
D) Increase Accounts Receivable; decrease Cash

Question 12

The bank reconciles its statement to the depositor's records.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following is true of EFT?

Accepted Answer

A) It cost more than receiving cash payments through the mail. 
B) It can process certain cash transactions at less cost than by using the mail. 
C) It is easy to document purchase and sale transactions. 
D) It means Effective Funds Transfer. 
A) It cost more than receiving cash payments through the mail. 
B) It can process certain cash transactions at less cost than by using the mail. 
C) It is easy to document purchase and sale transactions. 
D) It means Effective Funds Transfer.

Question 14

Money market funds,commercial paper,and U.S.Treasury Bills are examples of cash equivalents.

Accepted Answer

A) True 
 B)False

Question 15

The data needed to adjust a depositor's books are shown in the "adjustments to the depositor's records" section of a bank reconciliation.

Accepted Answer

A) True 
 B)False

Question 16

When a company reports negative net cash flows from operations .

Accepted Answer

A) ratio of equity to annual cash expenses helps in assessing the survival of the company 
B) ratio of equity to monthly cash expenses helps in assessing the survival of the company 
C) ratio of cash to monthly cash expenses helps in assessing the survival of the company 
D) ratio of accounts payable to annual financing expenses helps in assessing the survival of the company 
A) ratio of equity to annual cash expenses helps in assessing the survival of the company 
B) ratio of equity to monthly cash expenses helps in assessing the survival of the company 
C) ratio of cash to monthly cash expenses helps in assessing the survival of the company 
D) ratio of accounts payable to annual financing expenses helps in assessing the survival of the company

Question 17

Adding a review of operations by an internal audit staff weakens internal control.

Accepted Answer

A) True 
 B)False

Question 18

The amount of deposits in transit is included on the bank statement as a(n):

Accepted Answer

A) deduction from the cash balance per books. 
B) deduction from the cash balance per bank. 
C) addition to the cash balance per bank. 
D) addition to the cash balance per books. 
A) deduction from the cash balance per books. 
B) deduction from the cash balance per bank. 
C) addition to the cash balance per bank. 
D) addition to the cash balance per books.

Question 19

For a strong internal control system over cash,it is important to have the duties related to cash receipts and cash payments divided among different employees.

Accepted Answer

A) True 
 B)False

Question 20

Separating the responsibilities for purchasing,receiving,and paying for equipment is an example of the control procedure: separating operations,custody of assets,and accounting.

Accepted Answer

A) True 
 B)False

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

A check drawn by a depositor for $810 in payment of a liability was recorded by the depositor as $180.The $630 difference would be included on the bank reconciliation as a(n):

Accompanying the bank statement was a debit memorandum for an NSF check received from a customer.This item would require an adjusting entry including a:

a) Where are cash equivalents disclosed in the financial statements? (b) List three examples of cash equivalents.

In preparing a bank reconciliation,the amount of a canceled check omitted from the depositor's records is deducted from the cash balance per books.

Employee fraud is the intentional act of deceiving an employer for personal gain.

A check drawn by a depositor for $915 in payment of a liability was recorded in the depositor's book as $195.What adjustment is required in the depositor's accounts?

Receipts from cash sales of $7,500 were recorded incorrectly by the depositor as $5,700.What adjustment is required in the bank's accounts?

There are only two internal control objectives: to ensure accurate financial reports,and to ensure compliance with applicable laws.

Receipts from cash sales of $5,700 were recorded incorrectly by the depositor as $7,500.The $1,800 difference would be included on the bank reconciliation as a(n):

What adjustment is required in the depositor's accounts to record outstanding checks?

The bank reconciles its statement to the depositor's records.

Which of the following is true of EFT?

Money market funds,commercial paper,and U.S.Treasury Bills are examples of cash equivalents.

The data needed to adjust a depositor's books are shown in the "adjustments to the depositor's records" section of a bank reconciliation.

When a company reports negative net cash flows from operations .

Adding a review of operations by an internal audit staff weakens internal control.

The amount of deposits in transit is included on the bank statement as a(n):

For a strong internal control system over cash,it is important to have the duties related to cash receipts and cash payments divided among different employees.

Separating the responsibilities for purchasing,receiving,and paying for equipment is an example of the control procedure: separating operations,custody of assets,and accounting.

The Role of Accounting in Business

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters

Exam 5: Sarbanes-Oxley, internal Control, and Cash

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

A check drawn by a depositor for $810 in payment of a liability was recorded by the depositor as $180.The $630 difference would be included on the bank reconciliation as a(n):

Accompanying the bank statement was a debit memorandum for an NSF check received from a customer.This item would require an adjusting entry including a:

a) Where are cash equivalents disclosed in the financial statements? (b) List three examples of cash equivalents.

In preparing a bank reconciliation,the amount of a canceled check omitted from the depositor's records is deducted from the cash balance per books.

Employee fraud is the intentional act of deceiving an employer for personal gain.

A check drawn by a depositor for $915 in payment of a liability was recorded in the depositor's book as $195.What adjustment is required in the depositor's accounts?

Receipts from cash sales of $7,500 were recorded incorrectly by the depositor as $5,700.What adjustment is required in the bank's accounts?

There are only two internal control objectives: to ensure accurate financial reports,and to ensure compliance with applicable laws.

Receipts from cash sales of $5,700 were recorded incorrectly by the depositor as $7,500.The $1,800 difference would be included on the bank reconciliation as a(n):

What adjustment is required in the depositor's accounts to record outstanding checks?

The bank reconciles its statement to the depositor's records.

Which of the following is true of EFT?

Money market funds,commercial paper,and U.S.Treasury Bills are examples of cash equivalents.

The data needed to adjust a depositor's books are shown in the "adjustments to the depositor's records" section of a bank reconciliation.

When a company reports negative net cash flows from operations .

Adding a review of operations by an internal audit staff weakens internal control.

The amount of deposits in transit is included on the bank statement as a(n):

For a strong internal control system over cash,it is important to have the duties related to cash receipts and cash payments divided among different employees.

Separating the responsibilities for purchasing,receiving,and paying for equipment is an example of the control procedure: separating operations,custody of assets,and accounting.

The Role of Accounting in Business

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters