Question 1

Match between columns
                        Premises: Outstanding checks.
Deposits in transit.
Check for $690 incorrectly recorded by the company as $960.
Bank service charges.
NSF check.
Check for $420 incorrectly recorded by the company as $240.

Accepted Answer

The Answer of deduction from the cash balance according to is...

Question 2

The bank reconciles its statement to the company's records.

Accepted Answer

A) True 
 B)False

Question 3

A backlog in recording transactions is an example of a warning sign from the accounting system.

Accepted Answer

A) True 
 B)False

Question 4

The debit balance in Cash Short and Over at the end of an accounting period is reported as

Accepted Answer

A)  an expense on the income statement 
B)  income on the income statement 
C)  an asset on the balance sheet 
D)  a liability on the balance sheet 
A)  an expense on the income statement 
B)  income on the income statement 
C)  an asset on the balance sheet 
D)  a liability on the balance sheet

Question 5

Meredith Company gathered the following reconciling information in preparing its May bank reconciliation:

Accepted Answer

A)  $4,970 
B)  $5,120 
C)  $8,105 
D)  $3,295 
A)  $4,970 
B)  $5,120 
C)  $8,105 
D)  $3,295

Question 6

Cash equivalents are short -term investments that will be converted to cash within 120 days.

Accepted Answer

A) True 
 B)False

Question 7

Accompanying a bank statement for Marsh Land Properties is a credit memo for payment on a $15,000 note receivable that had been collected by the bank. The rate of interest on the note is 6%. Marsh Land Properties had been notified by the bank at the time of collection, but had made no entries. Journalize the entry that should be made by Marsh Land to bring the accounting records up to date.

Accepted Answer

Cash 15,900
Notes Re

Question 8

Following the completion of the bank reconciliation, an adjusting entry was made that debited cash and credited Interest Revenue. Therefore the bank reconciliation must have included an item that was

Accepted Answer

A)  deducted from the balance per company's records 
B)  deducted from the balance per bank statement 
C)  added to the balance per bank statement 
D)  added to the balance per company's records 
A)  deducted from the balance per company's records 
B)  deducted from the balance per bank statement 
C)  added to the balance per bank statement 
D)  added to the balance per company's records

Question 9

The term cash includes

Accepted Answer

A)  coins, currency (paper money), checks 
B)  money orders, and money on deposit that is available for unrestricted withdrawal 
C)  short-term receivables 
D)  both a and b 
A)  coins, currency (paper money), checks 
B)  money orders, and money on deposit that is available for unrestricted withdrawal 
C)  short-term receivables 
D)  both a and b

Question 10

Entries are made to the Petty Cash account when

Accepted Answer

A)  making payments out of the fund. 
B)  recording shortages in the fund. 
C)  replenishing the petty cash fund. 
D)  establishing the fund. 
A)  making payments out of the fund. 
B)  recording shortages in the fund. 
C)  replenishing the petty cash fund. 
D)  establishing the fund.

Question 11

A $150 petty cash fund has cash of $44 and receipts of $93. The journal entry to replenish the account would include a

Accepted Answer

A)  credit to Petty Cash for $49. 
B)  debit to Cash for $93. 
C)  debit to Cash Over and Short for $13. 
D)  credit to Cash for $44. 
A)  credit to Petty Cash for $49. 
B)  debit to Cash for $93. 
C)  debit to Cash Over and Short for $13. 
D)  credit to Cash for $44.

Question 12

Describe the features of a voucher system and list typical supporting documents for a voucher.

Accepted Answer

A voucher system is used to control cash

Question 13

Journalize the entries to record the following:
Jun 1 Established a petty cash fund of $200
Jun 30 The amount of cash in the petty cash fund is now $57. The fund is replenished based on the following receipts: postage, $25; entertainment $100; miscellaneous $20.
Record any discrepancy in the cash short and over account.
Journal

Accepted Answer

The answer of Journalize the entries to record the following:
Jun...

Question 14

The reconciliation of the cash register tape with the cash in the register is an example of

Accepted Answer

A)  other controls. 
B)  independent internal verification. 
C)  establishment of responsibility. 
D)  segregation of duties. 
A)  other controls. 
B)  independent internal verification. 
C)  establishment of responsibility. 
D)  segregation of duties.

Question 15

Which of the following would be deducted from 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 16

Which one of the following below is not an element of internal control?

Accepted Answer

A)  risk assessment 
B)  monitoring 
C)  information and communication 
D)  cost-benefit considerations 
A)  risk assessment 
B)  monitoring 
C)  information and communication 
D)  cost-benefit considerations

Question 17

Sarbanes-Oxley's purpose is to improve financial reporting.

Accepted Answer

A) True 
 B)False

Question 18

If an adjustment for an NSF check is made in a company's bank reconciliation, then the company must have written a bad check during the month.

Accepted Answer

A) True 
 B)False

Question 19

Present entries to record the following transactions:

Accepted Answer

The answer of Present entries to record the following transactions:
...

Question 20

Businesses who have several bank accounts, petty cash, and cash on hand, would maintain a separate ledger account for each type of cash.

Accepted Answer

A) True 
 B)False

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

The bank reconciles its statement to the company's records.

A backlog in recording transactions is an example of a warning sign from the accounting system.

The debit balance in Cash Short and Over at the end of an accounting period is reported as

Meredith Company gathered the following reconciling information in preparing its May bank reconciliation:

Cash equivalents are short -term investments that will be converted to cash within 120 days.

Following the completion of the bank reconciliation, an adjusting entry was made that debited cash and credited Interest Revenue. Therefore the bank reconciliation must have included an item that was

The term cash includes

Entries are made to the Petty Cash account when

A $150 petty cash fund has cash of $44 and receipts of $93. The journal entry to replenish the account would include a

Describe the features of a voucher system and list typical supporting documents for a voucher.

The reconciliation of the cash register tape with the cash in the register is an example of

Which of the following would be deducted from the balance per books on a bank reconciliation?

Which one of the following below is not an element of internal control?

Sarbanes-Oxley's purpose is to improve financial reporting.

If an adjustment for an NSF check is made in a company's bank reconciliation, then the company must have written a bad check during the month.

Present entries to record the following transactions:

Businesses who have several bank accounts, petty cash, and cash on hand, would maintain a separate ledger account for each type of cash.

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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