Question 1

Sarbanes-Oxley requires companies to maintain strong and effective internal controls and thus prevent fraud and misleading financial statements.

Accepted Answer

A) True 
 B)False

Question 2

The actual cash received during the week ended October 31 for cash sales was $23,447.00 and the amount indicated by the cash register total was $23,457.00. Journalize the entry to record the cash receipts and cash sales.
Journal

Accepted Answer

The answer of The actual cash received during the week...

Question 3

Accompanying the bank statement was a debit memo for an NSF check received from a customer. What entry is required in the company's accounts?

Accepted Answer

A)  debit Other Income; credit Cash 
B)  debit Cash; credit Other Income 
C)  debit Cash; credit Accounts Receivable 
D)  debit Accounts Receivable; credit Cash 
A)  debit Other Income; credit Cash 
B)  debit Cash; credit Other Income 
C)  debit Cash; credit Accounts Receivable 
D)  debit Accounts Receivable; credit Cash

Question 4

Cash equivalents include

Accepted Answer

A)  checks 
B)  coins and currency 
C)  money market accounts and commercial paper 
D)  stocks and short-term bonds 
A)  checks 
B)  coins and currency 
C)  money market accounts and commercial paper 
D)  stocks and short-term bonds

Question 5

The objectives of internal control are to

Accepted Answer

A)  control the internal organization of the accounting department personnel and equipment 
B)  provide reasonable assurance that operations are managed to achieve goals, financial reports are accurate, and laws and regulations are complied with 
C)  prevent fraud, and promote the social interest of the company 
D)  provide control over "internal-use only" reports and employee internal conduct 
A)  control the internal organization of the accounting department personnel and equipment 
B)  provide reasonable assurance that operations are managed to achieve goals, financial reports are accurate, and laws and regulations are complied with 
C)  prevent fraud, and promote the social interest of the company 
D)  provide control over "internal-use only" reports and employee internal conduct

Question 6

Money market accounts, commercial paper, and United States Treasury Notes are examples of cash equivalents.

Accepted Answer

A) True 
 B)False

Question 7

Consider the following journal entry made by Jones Company. Upon investigation, what might you find happened to create this amount of Cash Over/Short account difference? Give three possible reasons for this difference.

Accepted Answer

1. The beginning change fund in the draw

Question 8

Bank customers are considered creditors of the bank so the bank shows their accounts with credit balances on the bank's records.

Accepted Answer

A) True 
 B)False

Question 9

Roper Electronics received its bank statement for the month of August with an ending balance of $11,740.00. Roper determined that check #613 for $155.00 and check #601 for $420.00 were both outstanding. Also, a $6,900.00 deposit for August 30th was in transit as of the end of the month. Northern Regional Bank also collected a $5,000.00 notes receivable on August 1st that was issued March 1st at 12% annual interest. No interest revenue has been accrued on this note and Northern Regional Bank charged a $35.00 fee for the collection service.The bank statement reveals a bank service charge of $20.00. A customer check for $68.00 was returned with the bank statement marked "NSF". The ending balance of the Roper cash account is $12,938.00.
Complete a bank/account reconciliation and prepare any necessary journal entries for the reconciliation.

Accepted Answer

The answer of Roper Electronics received its bank statement for...

Question 10

For efficiency of operations and better control over cash, a company should maintain only one bank account.

Accepted Answer

A) True 
 B)False

Question 11

The following data is from the Miser Company for years ended 2008-2011.
 $$\begin{array}{l}
\text { Year Ending December } 31 \text { Data }\
\begin{array} { | l | l | l | l | l | } 
\hline & 2008 & 2009 & 2010 & 2011 \
\hline \text { Cash \& Cash Equivalents } & 23,788 & 45,776 & 52,899 & 82,744 \
\hline \text { Cash Flow from Operations } & ( 32,556 ) & ( 47,880 ) & ( 32,357 ) & ( 16,450 ) \
\hline
\end{array}
\end{array}$$ Calculate the following:
 $$\begin{array}{l}
\text { Year Ending December } 31 \text { Data }\
\begin{array} { | l | l | l | l | l | } 
\hline & 2008 & 2009 & 2010 & 2011 \
\hline \text { Monthly Cash Expenses } & & & & \
\hline \text { Ratio of Cash to Monthly Cash Expenses } & & & & \
\hline
\end{array}
\end{array}$$

Accepted Answer

The answer of The following data is from the Miser...

Question 12

The Scharf Company is a retailer located in a state without sales tax. The following data was given to you to complete the transactions for the day's sales to be recorded. All cash drawers start with $100 in change.
  Record the Journal Entries for EACH cash register to determine the cashier's accuracy.

Accepted Answer

First item for the student to

Question 13

On April 3rd, Snappy Sales decides to establish a $135.00 Petty Cash Account to relieve the burden on Accounting.
(a) Journalize this event.
(b) On April 11th, the petty cash fund has receipts for mail and postage of $32.75, contributions and donations of $25.25, meals and entertainment of $68.00 and $9.75 in cash. Journalize the replenishment of the fund.
(c) On April 12th, Snappy Sales decides to increase petty cash to $175.00. Journalize this event.

Accepted Answer

The answer of On April 3rd, Snappy Sales decides to...

Question 14

The amount of cash to be reported on the balance sheet at June 30 is the

Accepted Answer

A)  total of the cash column in the cash receipts journal as of June 30 
B)  adjusted balance appearing in the bank reconciliation for June 30 
C)  total of the cash column in the cash payments journal as of June 30 
D)  balance as of June 30 on the bank statement 
A)  total of the cash column in the cash receipts journal as of June 30 
B)  adjusted balance appearing in the bank reconciliation for June 30 
C)  total of the cash column in the cash payments journal as of June 30 
D)  balance as of June 30 on the bank statement

Question 15

All bank memos reported on the bank reconciliation require entries in the company's accounts.

Accepted Answer

A) True 
 B)False

Question 16

The following items may appear on a bank statement:
   Indicate whether the item would appear as debit or credit memo on the bank statement and whether the item would increase or decrease the balance of your account. Use the following format:

Accepted Answer

The answer of The following items may appear on a...

Question 17

Which of the following would be added to the 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 18

Internal control is enhanced by separating the control of a transaction from the record-keeping function.

Accepted Answer

A) True 
 B)False

Question 19

Consider the cash account below.
Additional Information: cash disbursements were 80% of collections.
  How much was the Beginning Balance of the Cash Account?

Accepted Answer

Calculation:
$115,375 X 80% = Disburseme

Question 20

Which of the following should not be considered cash by an accountant?

Accepted Answer

A)  money orders 
B)  bank checking accounts 
C)  postage stamps 
D)  travelers' checks 
A)  money orders 
B)  bank checking accounts 
C)  postage stamps 
D)  travelers' checks

Exam 7: Sarbanes-Oxley, Internal Control, and Cash

Sarbanes-Oxley requires companies to maintain strong and effective internal controls and thus prevent fraud and misleading financial statements.

The actual cash received during the week ended October 31 for cash sales was $23,447.00 and the amount indicated by the cash register total was $23,457.00. Journalize the entry to record the cash receipts and cash sales. Journal

Accompanying the bank statement was a debit memo for an NSF check received from a customer. What entry is required in the company's accounts?

Cash equivalents include

The objectives of internal control are to

Money market accounts, commercial paper, and United States Treasury Notes are examples of cash equivalents.

Consider the following journal entry made by Jones Company. Upon investigation, what might you find happened to create this amount of Cash Over/Short account difference? Give three possible reasons for this difference.

Bank customers are considered creditors of the bank so the bank shows their accounts with credit balances on the bank's records.

For efficiency of operations and better control over cash, a company should maintain only one bank account.

The amount of cash to be reported on the balance sheet at June 30 is the

All bank memos reported on the bank reconciliation require entries in the company's accounts.

The following items may appear on a bank statement: Indicate whether the item would appear as debit or credit memo on the bank statement and whether the item would increase or decrease the balance of your account. Use the following format:

Which of the following would be added to the balance per books on a bank reconciliation?

Internal control is enhanced by separating the control of a transaction from the record-keeping function.

Consider the cash account below. Additional Information: cash disbursements were 80% of collections. How much was the Beginning Balance of the Cash Account?

Which of the following should not be considered cash by an accountant?

Introduction to Accounting and Business

Analyzing Transactions

The Adjusting Process

Completing the Accounting Cycle

Accounting for Merchandising Businesses

Inventories

Receivables

Fixed Assets and Intangible Assets

Current Liabilities and Payroll

Corporations: Organization, Stock Transactions, and Dividends

Long-Term Liabilities: Bonds and Notes

Investments and Fair Value Accounting

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting Concepts and Principles

Job Order Costing

Process Cost Systems

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing for Management Analysis

Budgeting

Performance Evaluation Using Variances From Standard Costs

Performance Evaluation for Decentralized Operations

Differential Analysis and Product Pricing

Capital Investment Analysis

Cost Allocation and Activity-Based Costing

Cost Management for Just-In-Time Environments

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