Question 1

Which of the following is not considered a business (source)document?

Accepted Answer

A) Time card 
B) Purchase order 
C) Sales invoice 
D) Schedule listing all the insurance policies in force 
A) Time card 
B) Purchase order 
C) Sales invoice 
D) Schedule listing all the insurance policies in force

Question 2

How would customer's NSF checks be dealt with in a bank reconciliation?

Accepted Answer

A) added to company's book balance 
B) deducted from company's book balance 
C) added to bank statement balance 
D) deducted from bank statement balance 
A) added to company's book balance 
B) deducted from company's book balance 
C) added to bank statement balance 
D) deducted from bank statement balance

Question 3

Cash in the checking account and the petty cash fund are cash.The three-month certificates of deposit and the money market fund are both cash equivalents.
2.Accounts receivable and marketable securities should be classified on the balance sheet as current assets and listed in the order of their liquidity (marketable securities are more liquid than accounts receivable).
3.

Accepted Answer

The company is not as liquid at the end

Question 4

Which of the following represents the board of directors subset that acts as a direct contact between stockholders and the independent accounting firm?

Accepted Answer

A) Audit committee 
B) Internal audit staff 
C) External auditors 
D) Stockholders' representative 
A) Audit committee 
B) Internal audit staff 
C) External auditors 
D) Stockholders' representative

Question 5

The accountant for Casa Corp.was preparing a bank reconciliation as of February 28,2014.The following items were identified:   There was an error in recording a customer's check as the check was recorded by Casa as $110,but the correct amount of $101 was recorded by the bank.
Casa's adjusted cash balance at February 28,2014 is

Accepted Answer

A) $23,591 
B) $35,641 
C) $35,659 
D) $47,691 
A) $23,591 
B) $35,641 
C) $35,659 
D) $47,691

Question 6

When reconciling a bank account,the company must prepare an adjusting entry for deposits in transit.

Accepted Answer

A) True 
 B)False

Question 7

Which one of the following items would be added to the balance per books in a bank reconciliation?

Accepted Answer

A) Outstanding checks 
B) Deposit in transit 
C) Service charges 
D) Interest on customer note 
A) Outstanding checks 
B) Deposit in transit 
C) Service charges 
D) Interest on customer note

Question 8

A six-month certificate of deposit would be considered to be a cash equivalent.

Accepted Answer

A) True 
 B)False

Question 9

____________________ controls within a company are more concerned with efficient operations and the adherence to management policies than with the accurate reporting of financial information.

Accepted Answer

The answer of ____________________ controls within a company are more...

Question 10

A company's internal control system is designed by its external auditors.

Accepted Answer

A) True 
 B)False

Question 11

Checks returned by a bank because customers did not have sufficient funds in their account are called

Accepted Answer

A) Canceled checks 
B) Certified checks 
C) NSF checks 
D) Outstanding checks 
A) Canceled checks 
B) Certified checks 
C) NSF checks 
D) Outstanding checks

Question 12

If a company has internal auditors,it does not need to have external auditors.

Accepted Answer

A) True 
 B)False

Question 13

Houston Corp.prepares monthly bank reconciliations of its checking account balance.The bank statement for July 2014 indicated the following:

Accepted Answer

An analysis of canceled checks and depos

Question 14

Having only one person authorized to both prepare and sign checks is a violation of what internal control procedure?

Accepted Answer

A) Segregation of duties 
B) Independent review and appraisal 
C) Independent verifications 
D) Proper authorizations 
A) Segregation of duties 
B) Independent review and appraisal 
C) Independent verifications 
D) Proper authorizations

Question 15

The following set of items describes activities completed by a company in purchasing and paying for merchandise.For each activity,identify whether or not the activity adheres to or violates sound internal control procedures. Extensions and footings on purchase invoices are verified before the invoices are approved for payment

Accepted Answer

A) Adheres to sound internal control procedures 
B) Violates sound internal control procedures 
C) Neither strengthens nor violates internal control 
A) Adheres to sound internal control procedures 
B) Violates sound internal control procedures 
C) Neither strengthens nor violates internal control

Question 16

Which one of the following is not a procedure in the approval of a specific invoice for payment?

Accepted Answer

A) The purchase requisition,purchase order,receiving report,and invoice are compared. 
B) The extensions and footings on the invoice are verified. 
C) An employee verifies that all of the approval activities have been completed before a check is prepared. 
D) The purchasing department prepares a voucher to request payment. 
A) The purchase requisition,purchase order,receiving report,and invoice are compared. 
B) The extensions and footings on the invoice are verified. 
C) An employee verifies that all of the approval activities have been completed before a check is prepared. 
D) The purchasing department prepares a voucher to request payment.

Question 17

When reconciling a bank account,the company does not have to prepare an adjusting entry for outstanding checks.

Accepted Answer

A) True 
 B)False

Question 18

Some cash equivalents appear in the long term investment section of a balance sheet.

Accepted Answer

A) True 
 B)False

Question 19

Sarbanes-Oxley requires that the audit committee be composed of

Accepted Answer

A) At least 50% of key officers who are on the board of directors 
B) A majority of all of the members of the board of directors 
C) The outside members of the board of directors and the external auditor 
D) Entirely of outside members of the board of directors 
A) At least 50% of key officers who are on the board of directors 
B) A majority of all of the members of the board of directors 
C) The outside members of the board of directors and the external auditor 
D) Entirely of outside members of the board of directors

Question 20

Petty cash typically is composed of coins and currency kept on hand in a business to make minor disbursements.

Accepted Answer

A) True 
 B)False

Which of the following is not considered a business (source)document?

How would customer's NSF checks be dealt with in a bank reconciliation?

Which of the following represents the board of directors subset that acts as a direct contact between stockholders and the independent accounting firm?

When reconciling a bank account,the company must prepare an adjusting entry for deposits in transit.

Which one of the following items would be added to the balance per books in a bank reconciliation?

A six-month certificate of deposit would be considered to be a cash equivalent.

____________________ controls within a company are more concerned with efficient operations and the adherence to management policies than with the accurate reporting of financial information.

A company's internal control system is designed by its external auditors.

Checks returned by a bank because customers did not have sufficient funds in their account are called

If a company has internal auditors,it does not need to have external auditors.

Houston Corp.prepares monthly bank reconciliations of its checking account balance.The bank statement for July 2014 indicated the following:

Having only one person authorized to both prepare and sign checks is a violation of what internal control procedure?

Which one of the following is not a procedure in the approval of a specific invoice for payment?

When reconciling a bank account,the company does not have to prepare an adjusting entry for outstanding checks.

Some cash equivalents appear in the long term investment section of a balance sheet.

Sarbanes-Oxley requires that the audit committee be composed of

Petty cash typically is composed of coins and currency kept on hand in a business to make minor disbursements.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Receivables and Investments

Operating Assets: Property, plant, and Equipment, and Intangibles

Current Liabilities, contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International Financial Reporting Standards

Filters

Exam 6: Cash and Internal Control

Which of the following is not considered a business (source)document?

How would customer's NSF checks be dealt with in a bank reconciliation?

Which of the following represents the board of directors subset that acts as a direct contact between stockholders and the independent accounting firm?

When reconciling a bank account,the company must prepare an adjusting entry for deposits in transit.

Which one of the following items would be added to the balance per books in a bank reconciliation?

A six-month certificate of deposit would be considered to be a cash equivalent.

____________________ controls within a company are more concerned with efficient operations and the adherence to management policies than with the accurate reporting of financial information.

A company's internal control system is designed by its external auditors.

Checks returned by a bank because customers did not have sufficient funds in their account are called

If a company has internal auditors,it does not need to have external auditors.

Houston Corp.prepares monthly bank reconciliations of its checking account balance.The bank statement for July 2014 indicated the following:

Having only one person authorized to both prepare and sign checks is a violation of what internal control procedure?

Which one of the following is not a procedure in the approval of a specific invoice for payment?

When reconciling a bank account,the company does not have to prepare an adjusting entry for outstanding checks.

Some cash equivalents appear in the long term investment section of a balance sheet.

Sarbanes-Oxley requires that the audit committee be composed of

Petty cash typically is composed of coins and currency kept on hand in a business to make minor disbursements.

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Income Measurement and Accrual Accounting

Inventories and Cost of Goods Sold

Receivables and Investments

Operating Assets: Property, plant, and Equipment, and Intangibles

Current Liabilities, contingencies, and the Time Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

International Financial Reporting Standards

Filters