Question 1

Gia Company has the following information available:   What is the amount of Cash and Cash Equivalents to be reported on the balance sheet?

Accepted Answer

A) $0 
B) $400,000 
C) $3,400,000 
D) $5,900,000 
A) $0 
B) $400,000 
C) $3,400,000 
D) $5,900,000

Question 2

The Sarbanes-Oxley Act of 2002:

Accepted Answer

A) requires public companies to issue in writing that financial reports are accurate and that internal controls are adequate. 
B) has stiff penalties and prison time for violators of financial statement fraud. 
C) allows public companies to avoid a review of internal controls. 
D) A and B 
A) requires public companies to issue in writing that financial reports are accurate and that internal controls are adequate. 
B) has stiff penalties and prison time for violators of financial statement fraud. 
C) allows public companies to avoid a review of internal controls. 
D) A and B

Question 3

When reporting cash on the balance sheet,companies:

Accepted Answer

A) show each bank account separately. 
B) combine cash with accounts receivable. 
C) combine cash with long-term investments. 
D) combine cash and cash equivalents. 
A) show each bank account separately. 
B) combine cash with accounts receivable. 
C) combine cash with long-term investments. 
D) combine cash and cash equivalents.

Question 4

For each of the following situations,indicate which internal control procedure Johnson Company has violated:
1.Since they are costly,background checks are not done for the employees.
2.Purchases of items on credit do not need the approval of the purchasing department.
3.All hard copies of documents are shredded after one month and electronic records are deleted after two months.
4.The company does not prepare operating or cash budgets.
5.The accountant receives the checks from customers in payment of amounts due and records the cash receipts.
6.There are no locks in the area where inventory is stored.
7.The hiring,firing and pay adjustments are made by the foremen in the manufacturing area.

Accepted Answer

@#IMG-DLM& 2.Proper approvals.
3.Adequat

Question 5

A bank reconciliation included an outstanding check of $850 for the payment of salaries.The journal entry to record this reconciling item:

Accepted Answer

A) should debit Salaries Expense and credit Cash for $850. 
B) should debit Cash and credit Salaries Expense for $850. 
C) should debit Accounts Payable and credit Cash for $850. 
D) is not required. 
A) should debit Salaries Expense and credit Cash for $850. 
B) should debit Cash and credit Salaries Expense for $850. 
C) should debit Accounts Payable and credit Cash for $850. 
D) is not required.

Question 6

An imprest petty cash fund of $700 was established for minor disbursements.At the end of the month,the fund included petty cash tickets for the purchase of $202 in supplies,$77 for meals,$82 for fuel,and $71 for taxi fare.How much cash should be left in the fund?

Accepted Answer

A) $339 
B) $268 
C) $1,132 
D) $700 
A) $339 
B) $268 
C) $1,132 
D) $700

Question 7

An internal control system can be circumvented by:

Accepted Answer

A) collusion,encryption and management override. 
B) collusion,management override and segregation of duties. 
C) collusion,management override and human limitations. 
D) nothing,if it is a good internal control system. 
A) collusion,encryption and management override. 
B) collusion,management override and segregation of duties. 
C) collusion,management override and human limitations. 
D) nothing,if it is a good internal control system.

Question 8

In a bank reconciliation,a NSF check is:

Accepted Answer

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

Question 9

Cash equivalents include:

Accepted Answer

A) certificates of deposit. 
B) inventory held for sale. 
C) accounts receivable. 
D) high-grade U.S.or foreign government securities that are very close to maturity (three months or less from the balance sheet date). 
A) certificates of deposit. 
B) inventory held for sale. 
C) accounts receivable. 
D) high-grade U.S.or foreign government securities that are very close to maturity (three months or less from the balance sheet date).

Question 10

Smart hiring practices and separation of duties are part of the control environment.

Accepted Answer

A) True 
 B)False

Question 11

Smart hiring practices include:

Accepted Answer

A) background checks. 
B) clear job descriptions. 
C) proper training and supervision. 
D) all of the above. 
A) background checks. 
B) clear job descriptions. 
C) proper training and supervision. 
D) all of the above.

Question 12

When a company receives customers' checks by mail:

Accepted Answer

A) the mailroom sends all customer checks to the treasurer,who has the cashier deposit the checks in the bank. 
B) the treasurer prepares the journal entries. 
C) the mailroom employee prepares the journal entries. 
D) the treasury department cashier prepares the journal entries. 
A) the mailroom sends all customer checks to the treasurer,who has the cashier deposit the checks in the bank. 
B) the treasurer prepares the journal entries. 
C) the mailroom employee prepares the journal entries. 
D) the treasury department cashier prepares the journal entries.

Question 13

Which is NOT a component of comparisons and compliance monitoring?

Accepted Answer

A) control environment 
B) budgets 
C) audits 
D) all of the above 
A) control environment 
B) budgets 
C) audits 
D) all of the above

Question 14

Another term for a "hot check" is:

Accepted Answer

A) electronic check. 
B) outstanding check. 
C) nonsufficient funds (NSF)check. 
D) cleared checks. 
A) electronic check. 
B) outstanding check. 
C) nonsufficient funds (NSF)check. 
D) cleared checks.

Question 15

The longer a perpetrator has worked for an organization,the lower the fraud losses tend to be.

Accepted Answer

A) True 
 B)False

Question 16

Olde Shoppe has the following information at August 31:   What is the adjusted book balance at August 31?

Accepted Answer

A) $11,667 
B) $13,804 
C) $13,554 
D) $8,164 
A) $11,667 
B) $13,804 
C) $13,554 
D) $8,164

Question 17

Internal controls for cash receipts over the counter and for cash receipts by mail are identical.

Accepted Answer

A) True 
 B)False

Question 18

Marjorie Company's cash balance per the books at the end of the month was $8,600.After comparing the company's records with the monthly bank statement,Marjorie's accountant identified the following reconciling items: outstanding checks,$800;deposits in transit,$700;bank service charge,$10;and NSF check,$200.The bank collection of a note receivable was $1,000 plus interest of $100.There also was an EFT payment of $160.What is the adjusted book balance at the end of the month?

Accepted Answer

A) $9,490 
B) $9,390 
C) $8,500 
D) $9,330 
A) $9,490 
B) $9,390 
C) $8,500 
D) $9,330

Question 19

________ is the element in the fraud triangle that results from weak internal controls.

Accepted Answer

A) Motive 
B) Opportunity 
C) Rationalization 
D) Reasoning 
A) Motive 
B) Opportunity 
C) Rationalization 
D) Reasoning

Question 20

Which journal entry is prepared for a NSF check returned by the bank?

Accepted Answer

A) No entry is prepared. 
B) Debit Cash and credit Accounts Payable. 
C) Debit Cash and credit Notes Payable. 
D) Debit Accounts Receivable and credit Cash. 
A) No entry is prepared. 
B) Debit Cash and credit Accounts Payable. 
C) Debit Cash and credit Notes Payable. 
D) Debit Accounts Receivable and credit Cash.

Gia Company has the following information available: What is the amount of Cash and Cash Equivalents to be reported on the balance sheet?

The Sarbanes-Oxley Act of 2002:

When reporting cash on the balance sheet,companies:

A bank reconciliation included an outstanding check of $850 for the payment of salaries.The journal entry to record this reconciling item:

An imprest petty cash fund of $700 was established for minor disbursements.At the end of the month,the fund included petty cash tickets for the purchase of $202 in supplies,$77 for meals,$82 for fuel,and $71 for taxi fare.How much cash should be left in the fund?

An internal control system can be circumvented by:

In a bank reconciliation,a NSF check is:

Cash equivalents include:

Smart hiring practices and separation of duties are part of the control environment.

Smart hiring practices include:

When a company receives customers' checks by mail:

Which is NOT a component of comparisons and compliance monitoring?

Another term for a "hot check" is:

The longer a perpetrator has worked for an organization,the lower the fraud losses tend to be.

Olde Shoppe has the following information at August 31: What is the adjusted book balance at August 31?

Internal controls for cash receipts over the counter and for cash receipts by mail are identical.

________ is the element in the fraud triangle that results from weak internal controls.

Which journal entry is prepared for a NSF check returned by the bank?

The Financial Statements

Transaction Analysis

Accrual Accounting Income

Receivables and Revenue

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters

Exam 4: Internal Control Cash

Gia Company has the following information available: What is the amount of Cash and Cash Equivalents to be reported on the balance sheet?

The Sarbanes-Oxley Act of 2002:

When reporting cash on the balance sheet,companies:

A bank reconciliation included an outstanding check of $850 for the payment of salaries.The journal entry to record this reconciling item:

An imprest petty cash fund of $700 was established for minor disbursements.At the end of the month,the fund included petty cash tickets for the purchase of $202 in supplies,$77 for meals,$82 for fuel,and $71 for taxi fare.How much cash should be left in the fund?

An internal control system can be circumvented by:

In a bank reconciliation,a NSF check is:

Cash equivalents include:

Smart hiring practices and separation of duties are part of the control environment.

Smart hiring practices include:

When a company receives customers' checks by mail:

Which is NOT a component of comparisons and compliance monitoring?

Another term for a "hot check" is:

The longer a perpetrator has worked for an organization,the lower the fraud losses tend to be.

Olde Shoppe has the following information at August 31: What is the adjusted book balance at August 31?

Internal controls for cash receipts over the counter and for cash receipts by mail are identical.

________ is the element in the fraud triangle that results from weak internal controls.

Which journal entry is prepared for a NSF check returned by the bank?

The Financial Statements

Transaction Analysis

Accrual Accounting Income

Receivables and Revenue

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters