Please refer to the following bank reconciliation: $\begin{array}{lr} \begin{array}{lr} \text { BANK }\\ \hline\text { Balance, June } 30,2014 & \$ 10,241.43 \\ \text { ADD: } & \\ \text { Deposit in transit } & 5,113.40 \\ \\ \\ \text { LESS: } & \\ \text { Outstanding Check\# 506 } & (1,948.52)\\ \text { Outstanding Check\# 510 } & (1,800.25) \\ \\ \text { Adjusted balance, June 30,2014 }&\underline{ \$ 11,606.06 }\\ \end{array} \begin{array}{|lr} \text { BOOK }\\ \hline \text { Balance, June } 30,2014 & \$ 9,745.06 \\ \text { ADD: } & \\ \text { Note collected by bank } &1,900.00 \\ \text { Interest revenue } & 75.00 \\ & \\ \text { LESS: } & \\ \text { NSF check } &(79.00) \\ \text { Bank service charge } & (35.00) \\ \\ \text { Adjusted balance, June } 30,2014 & \underline{\$ 11,606.06} \\ \end{array} \end{array}$ - Journal entries are required for the reconciling items on the book side because:

A) those transactions have not yet been recorded by the bank. B) the adjusted balances on both sides are the same amounts. C) the amounts are immaterial. D) those transactions have already occurred, but have not been recorded yet on the company books. A) those transactions have not yet been recorded by the bank. B) the adjusted balances on both sides are the same amounts. C) the amounts are immaterial. D) those transactions have already occurred, but have not been recorded yet on the company books.

Exam 7: Internal Control and Cash

In the following situation,which internal control procedure needs strengthening? - At Hofstra Services,the junior accountant collects checks and cash from customers and records the transactions into the Journal.The controller approves the journal entries and bank reconciliations.The treasurer signs checks and approves contracts.

(Multiple Choice)

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Question 121

A document authorizing a cash payment is a(n):

(Multiple Choice)

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Question 122

For good controls over cash payments,the company officer approving a payment voucher should be the same as the person who ordered the goods,to ensure that the correct amount of cash is paid.

(True/False)

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Question 123

Petty cash is a fund containing a small amount of cash that is used to pay for minor expenditures.

(True/False)

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Question 124

A fund for petty cash of $200 has $17 remaining in cash,$3 in miscellaneous cash receipts and additional $180 specific cash receipts.The debit to Cash short & over would be:

(Multiple Choice)

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Question 125

As part of the internal control over cash receipts by mail,the mailroom sends both the customer checks and the remittance advices to the accounting department.

(True/False)

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Question 126

Regarding controls over cash receipts by mail,the bank deposit slip should be compared to the remittance advices by the accounting department.

(True/False)

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Question 127

Please refer to the following bank reconciliation: BANK Balance, June 30,2014 \ 10,241.43 ADD: Deposit in transit 5,113.40 LESS: Outstanding Check\# 506 (1,948.52) Outstanding Check\# 510 (1,800.25) Adjusted balance, June 30,2014 BOOK Balance, June 30,2014 \ 9,745.06 ADD: Note collected by bank 1,900.00 Interest revenue 75.00 LESS: NSF check (79.00) Bank service charge (35.00) Adjusted balance, June 30,2014 - Please prepare the adjusting entry for the first reconciling item (note collected by bank.)

(Essay)

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Question 128

A company makes a legitimate,properly authorized payment to a supplier.The accountant changes the date of the transaction to shift it to a later time period.Because the transaction is legitimate,this action would not be considered unethical.

(True/False)

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Question 129

Which of the following is retained by the customer as proof of a deposit transaction?

(Multiple Choice)

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Question 130

Which of the following is the last step in the daily control over cash receipts by mail?

(Multiple Choice)

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Question 131

For good controls over cash payments,the person who orders goods from a supplier should always be different from the person who approves the payment.

(True/False)

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Question 132

Which of the following statements describes a purchase order?

(Multiple Choice)

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Question 133

Which of the following statements describes a receiving report?

(Multiple Choice)

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Question 134

An accountant is under pressure to maximize the company's net income at year-end.He is told to record expense payments made in December as if they were actually made the following January.This action would be considered unethical because it is a misrepresentation of actual transactions.

(True/False)

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Question 135

Which of the following statements describes the decision guidelines for an ethical decision?

(Multiple Choice)

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Question 136

Under the Sarbanes-Oxley Act,violators may be sentenced to prison for securities fraud.

(True/False)

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Question 137

Please refer to the following bank reconciliation: BANK Balance, June 30,2014 \ 10,241.43 ADD: Deposit in transit 5,113.40 LESS: Outstanding Check\# 506 (1,948.52) Outstanding Check\# 510 (1,800.25) Adjusted balance, June 30,2014 BOOK Balance, June 30,2014 \ 9,745.06 ADD: Note collected by bank 1,900.00 Interest revenue 75.00 LESS: NSF check (79.00) Bank service charge (35.00) Adjusted balance, June 30,2014 - Journal entries are required for the reconciling items on the book side because:

(Multiple Choice)

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(93)

Question 138

A key to strong control over petty cash is to ensure that several persons serve as custodian at one time.

(True/False)

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Question 139

Which of the following is a security procedure designed for e-commerce?

(Multiple Choice)

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Question 140

A document authorizing a cash payment is a(n):

For good controls over cash payments,the company officer approving a payment voucher should be the same as the person who ordered the goods,to ensure that the correct amount of cash is paid.

Petty cash is a fund containing a small amount of cash that is used to pay for minor expenditures.

A fund for petty cash of $200 has $17 remaining in cash,$3 in miscellaneous cash receipts and additional $180 specific cash receipts.The debit to Cash short & over would be:

As part of the internal control over cash receipts by mail,the mailroom sends both the customer checks and the remittance advices to the accounting department.

Regarding controls over cash receipts by mail,the bank deposit slip should be compared to the remittance advices by the accounting department.

A company makes a legitimate,properly authorized payment to a supplier.The accountant changes the date of the transaction to shift it to a later time period.Because the transaction is legitimate,this action would not be considered unethical.

Which of the following is retained by the customer as proof of a deposit transaction?

Which of the following is the last step in the daily control over cash receipts by mail?

For good controls over cash payments,the person who orders goods from a supplier should always be different from the person who approves the payment.

Which of the following statements describes a purchase order?

Which of the following statements describes a receiving report?

An accountant is under pressure to maximize the company's net income at year-end.He is told to record expense payments made in December as if they were actually made the following January.This action would be considered unethical because it is a misrepresentation of actual transactions.

Which of the following statements describes the decision guidelines for an ethical decision?

Under the Sarbanes-Oxley Act,violators may be sentenced to prison for securities fraud.

A key to strong control over petty cash is to ensure that several persons serve as custodian at one time.

Which of the following is a security procedure designed for e-commerce?

Accounting and the Business Environment

Recording Business Transactions

The Adjusting Process

Completing the Accounting Cycle

Merchandising Operations

Merchandising Inventory

Receivables

Plant Assets and Intangibles

Current Liabilities and Payroll

Long-Term Liabilities, bonds Payable, and Classification of Liabilities on the Balance Sheet

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