Question 1

A ________ fund is used to make cash disbursements of small amounts to avoid the time and cost of writing checks.

Accepted Answer

The answer of A ________ fund is used to make...

Question 2

Internal control procedures for cash receipts do not require that:

Accepted Answer

A)  Custody over cash is kept separate from its recordkeeping. 
B)  All collections for sales are received immediately upon making the sales. 
C)  Clerks having access to cash in a cash register should not have access to the register tape or file. 
D)  An employee with no access to cash receipts should compare the total cash recorded by the register with the record of cash receipts reported by the cashier. 
E)  Cash sales should be recorded on a cash register at the time of each sale. 
A)  Custody over cash is kept separate from its recordkeeping. 
B)  All collections for sales are received immediately upon making the sales. 
C)  Clerks having access to cash in a cash register should not have access to the register tape or file. 
D)  An employee with no access to cash receipts should compare the total cash recorded by the register with the record of cash receipts reported by the cashier. 
E)  Cash sales should be recorded on a cash register at the time of each sale.

Question 3

During the month of July,Clanton Industries issued a check in the amount of $845 to a supplier on account.The check did not clear the bank during July.In preparing the July 31 bank reconciliation,the company should:

Accepted Answer

A)  Deduct the check amount from the book balance of cash. 
B)  Add the check amount to the book balance of cash. 
C)  Deduct the check amount from the bank balance. 
D)  Add the check amount to the bank balance. 
E)  Make a journal entry in the company records for an error. 
A)  Deduct the check amount from the book balance of cash. 
B)  Add the check amount to the book balance of cash. 
C)  Deduct the check amount from the bank balance. 
D)  Add the check amount to the bank balance. 
E)  Make a journal entry in the company records for an error.

Question 4

The voucher system of control:

Accepted Answer

A)  Is a set of procedures and approvals designed to control cash receipts and the acceptance of obligations. 
B)  Establishes procedures for verifying, approving, and recording obligations for eventual cash disbursement. 
C)  Establishes procedures for receiving checks for the sale of verified, approved, and recorded activities. 
D)  Applies only when multiple purchases are made from the same supplier. 
E)  Is required in large companies but not beneficial for small to mid-sized companies. 
A)  Is a set of procedures and approvals designed to control cash receipts and the acceptance of obligations. 
B)  Establishes procedures for verifying, approving, and recording obligations for eventual cash disbursement. 
C)  Establishes procedures for receiving checks for the sale of verified, approved, and recorded activities. 
D)  Applies only when multiple purchases are made from the same supplier. 
E)  Is required in large companies but not beneficial for small to mid-sized companies.

Question 5

Having external auditors test the company's financial records and evaluate the effectiveness of the internal control system is part of the internal control principle of ________.

Accepted Answer

perform re

Question 6

The document prepared by the vendor that is an itemized statement of goods listing the customer's name,items sold,sales prices,and terms of the sale is the ________.

Accepted Answer

The answer of The document prepared by the vendor that...

Question 7

A company had $43 missing from petty cash that was not accounted for by petty cash receipts.The correct procedure is to:

Accepted Answer

A)  Debit Cash Over and Short for $43. 
B)  Credit Cash Over and Short for $43. 
C)  Debit Petty Cash for $43. 
D)  Credit Petty Cash for $43. 
E)  Credit Cash for $43. 
A)  Debit Cash Over and Short for $43. 
B)  Credit Cash Over and Short for $43. 
C)  Debit Petty Cash for $43. 
D)  Credit Petty Cash for $43. 
E)  Credit Cash for $43.

Question 8

A voucher system is a set of procedures and approvals designed to control cash disbursements and the acceptance of obligations.

Accepted Answer

A) True 
 B)False

Question 9

________ reflects the liquidity of a company's accounts receivable.

Accepted Answer

Days' sales uncollec

Question 10

________ includes currency,coins,and amounts on deposit in checking accounts and savings accounts.

Accepted Answer

The answer of ________ includes currency,coins,and amounts on deposit in...

Question 11

Outstanding checks,deposits in transit,and bank service charges are added to the beginning balance of the bank statement to determine the adjusted bank balance.

Accepted Answer

A) True 
 B)False

Question 12

It is generally not necessary for businesses to reconcile their checking accounts since banks keep accurate records and provide internal control support for cash.

Accepted Answer

A) True 
 B)False

Question 13

The entry to record reimbursement of the petty cash fund for postage expense should include:

Accepted Answer

A)  A debit to Postage Expense. 
B)  A debit to Petty Cash. 
C)  A debit to Cash. 
D)  A debit to Cash Short and Over. 
E)  A debit to Supplies. 
A)  A debit to Postage Expense. 
B)  A debit to Petty Cash. 
C)  A debit to Cash. 
D)  A debit to Cash Short and Over. 
E)  A debit to Supplies.

Question 14

A voucher system's control over cash disbursements begins when a company incurs an obligation that will result in eventual payment of cash.

Accepted Answer

A) True 
 B)False

Question 15

A person who controls or has access to an asset must not keep that asset's accounting records.This describes the internal control principle of ________.

Accepted Answer

separate r

Question 16

Havermill Co.establishes a $250 petty cash fund on September 1.On September 30,the fund is replenished.The accumulated receipts on that date represent $73 for Office Supplies,$137 for merchandise inventory,and $22 for miscellaneous expenses.The fund has a balance of $18.On October 1,the accountant determines that the fund should be increased by $50.
-The journal entry to record the establishment of the fund on September 1 is:

Accepted Answer

A)  Debit Cash $250; credit Petty Cash $250. 
B)  Debit Petty Cash $250; credit Accounts Payable $250. 
C)  Debit Miscellaneous Expense $250; credit Cash $250. 
D)  Debit Petty Cash $250; credit Cash $250. 
E)  Debit Cash $250; credit Accounts Payable $250. 
A)  Debit Cash $250; credit Petty Cash $250. 
B)  Debit Petty Cash $250; credit Accounts Payable $250. 
C)  Debit Miscellaneous Expense $250; credit Cash $250. 
D)  Debit Petty Cash $250; credit Cash $250. 
E)  Debit Cash $250; credit Accounts Payable $250.

Question 17

A company had net sales of $21,500 and ending accounts receivable of $2,700 for the current period.Its days' sales uncollected equals: (Use 365 days a year.)

Accepted Answer

A)  8.0 days. 
B)  58.9 days. 
C)  45.8 days. 
D)  7.4 days. 
E)  45.2 days. 
A)  8.0 days. 
B)  58.9 days. 
C)  45.8 days. 
D)  7.4 days. 
E)  45.2 days.

Question 18

A voucher system is a set of procedures and approvals:

Accepted Answer

A)  Designed to eliminate the need for subsidiary ledgers. 
B)  Designed to determine if the company is operating profitably. 
C)  Used almost exclusively by small companies. 
D)  Used to ensure that the company sells on credit only to creditworthy customers. 
E)  Designed to control cash disbursements and the acceptance of obligations. 
A)  Designed to eliminate the need for subsidiary ledgers. 
B)  Designed to determine if the company is operating profitably. 
C)  Used almost exclusively by small companies. 
D)  Used to ensure that the company sells on credit only to creditworthy customers. 
E)  Designed to control cash disbursements and the acceptance of obligations.

Question 19

In the process of reconciling its bank statement for January,Maxi's Clothing's accountant compiles the following information:
$$\begin{array} { | l | r | } 
\hline \text { Cash balance per company books on January 30 } & \$ 4,725 \
\hline \text { Deposits in transit at month-end } & \$ 1,800 \
\hline \text { Outstanding checks at month-end } & \$ 520 \
\hline \text { Bank service charges } & \$ 25 \
\hline \text { EFT automatically deducted monthly, not yet recorded by Maxi } & \$ 380 \
\hline \text { An NSF check returned on a customer account } & \$ 265 \
\hline
\end{array}$$
The adjusted cash balance per the books on January 31 is:

Accepted Answer

A)  $5,855 
B)  $5,335 
C)  $4,055 
D)  $4,815 
E)  $4,585 
A)  $5,855 
B)  $5,335 
C)  $4,055 
D)  $4,815 
E)  $4,585

Question 20

When a company purchases an insurance policy against losses from theft by an employee,that employee is ________.

Accepted Answer

The answer of When a company purchases an insurance policy...

A ________ fund is used to make cash disbursements of small amounts to avoid the time and cost of writing checks.

Internal control procedures for cash receipts do not require that:

During the month of July,Clanton Industries issued a check in the amount of $845 to a supplier on account.The check did not clear the bank during July.In preparing the July 31 bank reconciliation,the company should:

The voucher system of control:

Having external auditors test the company's financial records and evaluate the effectiveness of the internal control system is part of the internal control principle of ________.

The document prepared by the vendor that is an itemized statement of goods listing the customer's name,items sold,sales prices,and terms of the sale is the ________.

A company had $43 missing from petty cash that was not accounted for by petty cash receipts.The correct procedure is to:

A voucher system is a set of procedures and approvals designed to control cash disbursements and the acceptance of obligations.

________ reflects the liquidity of a company's accounts receivable.

________ includes currency,coins,and amounts on deposit in checking accounts and savings accounts.

Outstanding checks,deposits in transit,and bank service charges are added to the beginning balance of the bank statement to determine the adjusted bank balance.

It is generally not necessary for businesses to reconcile their checking accounts since banks keep accurate records and provide internal control support for cash.

The entry to record reimbursement of the petty cash fund for postage expense should include:

A voucher system's control over cash disbursements begins when a company incurs an obligation that will result in eventual payment of cash.

A person who controls or has access to an asset must not keep that asset's accounting records.This describes the internal control principle of ________.

A company had net sales of $21,500 and ending accounts receivable of $2,700 for the current period.Its days' sales uncollected equals: (Use 365 days a year.)

A voucher system is a set of procedures and approvals:

When a company purchases an insurance policy against losses from theft by an employee,that employee is ________.

Accounting in Business

Analyzing for Business Transactions

Adjusting Accounts for Financial Statements

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Corporate Reporting and Analysis

Reporting Cash Flows

Analysis of Financial Statements

Time Value of Money

Investments

Partnership Accounting

Filters

Exam 6: Cash, fraud, and Internal Controls

A ________ fund is used to make cash disbursements of small amounts to avoid the time and cost of writing checks.

Internal control procedures for cash receipts do not require that:

During the month of July,Clanton Industries issued a check in the amount of $845 to a supplier on account.The check did not clear the bank during July.In preparing the July 31 bank reconciliation,the company should:

The voucher system of control:

Having external auditors test the company's financial records and evaluate the effectiveness of the internal control system is part of the internal control principle of ________.

The document prepared by the vendor that is an itemized statement of goods listing the customer's name,items sold,sales prices,and terms of the sale is the ________.

A company had $43 missing from petty cash that was not accounted for by petty cash receipts.The correct procedure is to:

A voucher system is a set of procedures and approvals designed to control cash disbursements and the acceptance of obligations.

________ reflects the liquidity of a company's accounts receivable.

________ includes currency,coins,and amounts on deposit in checking accounts and savings accounts.

Outstanding checks,deposits in transit,and bank service charges are added to the beginning balance of the bank statement to determine the adjusted bank balance.

It is generally not necessary for businesses to reconcile their checking accounts since banks keep accurate records and provide internal control support for cash.

The entry to record reimbursement of the petty cash fund for postage expense should include:

A voucher system's control over cash disbursements begins when a company incurs an obligation that will result in eventual payment of cash.

A person who controls or has access to an asset must not keep that asset's accounting records.This describes the internal control principle of ________.

A company had net sales of $21,500 and ending accounts receivable of $2,700 for the current period.Its days' sales uncollected equals: (Use 365 days a year.)

A voucher system is a set of procedures and approvals:

When a company purchases an insurance policy against losses from theft by an employee,that employee is ________.

Accounting in Business

Analyzing for Business Transactions

Adjusting Accounts for Financial Statements

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Corporate Reporting and Analysis

Reporting Cash Flows

Analysis of Financial Statements

Time Value of Money

Investments

Partnership Accounting

Filters