Exam 6: Cash,fraud,and Internal Controls

A company established a petty cash fund in April of the current year and experienced the following transactions affecting the fund during April.Prepare journal entries to establish the fund on April 1,to replenish it on April 25,and to record the increase in the fund on April 25.

The following information is available for the Topper Company for the month of July. a.On July 31,after all transactions have been recorded,the balance in the company's Cash account has a balance of $15,244. b.The company's bank statement shows a balance on July of $16,450. c.Outstanding checks at July total $2,063. d.A note receivable is collected by the bank for $570,but it is not yet recorded by Topper Company. e.A $107 NSF check from a customer,P.Flank is shown on the bank statements,but not yet recorded by Topper. f.A deposit placed in the bank's night depository on July 31 totaling $1,275 did not appear on the bank statement. h.Bank fees of $45 for check printing are not yet recorded by Topper Company. Prepare the July bank reconciliation for the Topper Company.

If a check correctly written and paid by the bank for $749 is incorrectly recorded in the company's books for $794,how should this error be treated on the bank reconciliation?

Outstanding checks are checks the bank has paid and deducted from the customer's account during the month.

The following information is available for the Victor Company for its March 31 bank reconciliation: From the March 31 bank statement: NSF: A check from a customer,Booker Co.in payment of their account.IN: Interest earned on the account.From the Victor Company's accounting records: 1.Based on the above information,prepare a bank reconciliation for the Victor Company.2.Prepare the necessary general journal entries to adjust cash to the reconciled balance.

The following information is available for Montrose Company at December 31: Based on this information,the amounts considered Cash and Cash Equivalents,respectively on December 31 are:

The Sarbanes-Oxley Act (SOX)requires managers and auditors of companies whose stock is traded on an exchange to document and certify the system of internal controls.What are the specific requirements for auditors set forth by SOX?

When evaluating the days' sales uncollected ratio,generally the higher the receivables balance,the better the ratio.

The three parties involved with a check are:

In the process of reconciling its bank statement for January,Maxi's Clothing's accountant compiles the following information: The adjusted cash balance per the books on January 31 is: A)$5,855 B)$5,335 C)$4,055 D)$4,815 E)$4,585

Clayborn Company' bank reconciliation as of May 31 is shown below. One of the adjusting journal entries that Clayborn must record as a result of the bank reconciliation includes:

A company wants to decrease its $200 petty cash fund to $175.The entry to reduce the fund is:

Cash equivalents:

At the end of the day,the cash register tape shows $1,000 in cash sales but the count of cash in the register is $1,010.The proper entry to account for this excess is:

Money orders,cashier's checks,and certified checks are all examples of cash.

Internal control of cash receipts aims to ensure that all cash received is properly recorded and deposited.

Childers Company,which uses a perpetual inventory system,has an established petty cash fund in the amount of $400.The fund was last reimbursed on November 30.At the end of December,the fund contained the following petty cash receipts: If,in addition to these receipts,the petty cash fund contains $201 of cash,the journal entry to reimburse the fund on December 31 will include:

The voucher system of control:

Principles of internal control include all of the following except:

The entry to establish a petty cash fund includes: