Exam 8: Cash and Internal Controls

The following information is available for Johnson Manufacturing Company at June 30: Based on this information, Johnson Manufacturing Company should report Cash and Cash Equivalents on June 30 of:

The entry to increase the balance in petty cash from $50 to $75 would include a credit to Petty Cash of $25.

A _____________________________ fund is used for the control of small amounts of cash disbursements.

The days' sales uncollected ratio is used to:

_______________________ are deposits made and recorded by the depositor but not yet recorded on the bank statement.

Basic bank services include:

A remittance advice is:

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

A company established a $400 petty cash fund by issuing a check to the custodian on October 1. On October 15, the petty cash fund was replenished and increased to $1,000 in total. The contents of the petty cash fund at the time of the October 15 replenishment were: Prepare the general journal entry to record both the reimbursement and the increase of the petty fund on October 15.

A company established a petty cash fund in April of the current year and experienced the following transactions affecting the fund during April. Prepare journal entries to establish the fund on April 1, to replenish it on April 25, and to record the increase in the fund on April 25.

The document the purchasing department sends to the vendor that is used to place an order is the _________________________.

Effective cash management involves applying all of the following cash management principles except:

A ____________ is a report explaining any differences between the checking account balance according to the depositor's records and the balance reported on the bank statement.

Dylan Lauren of Dylan's Candy Bar knew good business practice requires the use of effective internal controls. Identify some of the internal controls that Dylan's Candy Bar implemented and explain how those controls contributed to the firm's success.

On a bank reconciliation, the amount of an unrecorded bank service charge should be:

A company had the following transactions during January: Using the net method of recording purchases, prepare the journal entries to record these January transactions.

In reimbursing the petty cash fund:

The number of days' sales uncollected:

A key factor in a voucher system is:

List the principles of internal control.