Question 1

What is the purpose of internal control?

Accepted Answer

Internal control helps a compa

Question 2

Prepare journal entries for the following petty cash fund transactions:
Aug. 1 Established a $50 petty cash fund.
31 Replenished the petty cash fund. Currency and coins remaining were $8.
Approved paid vouchers were $6 donation expense, $9 postage expense,
$12 office supplies expense, and $13 miscellaneous expense.

Accepted Answer

Aug.1 Petty Cash 50
Cash 50
Au

Question 3

Petty Cash is an asset shown on the balance sheet.

Accepted Answer

A) True 
 B)False

Question 4

The Petty Cash account is debited when

Accepted Answer

A)  the account is being replenished. 
B)  the account balance is being decreased. 
C)  the account balance is being increased. 
D)  the custodian pays for postage from petty cash. 
A)  the account is being replenished. 
B)  the account balance is being decreased. 
C)  the account balance is being increased. 
D)  the custodian pays for postage from petty cash.

Question 5

The person or company to whom a cheque is payable is called the

Accepted Answer

A)  payer. 
B)  drawer. 
C)  drawee. 
D)  payee. 
A)  payer. 
B)  drawer. 
C)  drawee. 
D)  payee.

Question 6

Using correct cash handling procedures, deposits should be made by the end of the week.

Accepted Answer

A) True 
 B)False

Question 7

Transferring money without paper cheques is called electronic funds transfer.

Accepted Answer

A) True 
 B)False

Question 8

The petty cash overage was not recorded. This would cause

Accepted Answer

A)  revenues to be overstated. 
B)  revenues to be understated. 
C)  expenses to be overstated. 
D)  expenses to be understated. 
A)  revenues to be overstated. 
B)  revenues to be understated. 
C)  expenses to be overstated. 
D)  expenses to be understated.

Question 9

The Petty Cash account should always be debited when the fund is replenished.

Accepted Answer

A) True 
 B)False

Question 10

The auxiliary petty cash record is posted to the ledger.

Accepted Answer

A) True 
 B)False

Question 11

How would outstanding cheques be handled when reconciling the ending cash balance per the bank statement to the correct adjusted cash balance?

Accepted Answer

A)  They would be added to the balance of the bank statement. 
B)  They would be subtracted from the balance of the bank statement. 
C)  They would be added to the balance per books. 
D)  They would be ignored. 
A)  They would be added to the balance of the bank statement. 
B)  They would be subtracted from the balance of the bank statement. 
C)  They would be added to the balance per books. 
D)  They would be ignored.

Question 12

Calculate, from the following information accumulated by Vera Freese, the adjusted cash balance at the end of April. Bank statement ending cash balance $3,000
General ledger cash balance ending 4,250
Bank monthly service charge 45
Deposits in transit 2,500
Outstanding cheques 1,500
NSF cheque returned with bank statement 205

Accepted Answer

A)  $3,000 
B)  $4,250 
C)  $4,000 
D)  $5,500 
A)  $3,000 
B)  $4,250 
C)  $4,000 
D)  $5,500

Question 13

The bank statement shows

Accepted Answer

A)  the beginning bank balance of the cash at the start of the month. 
B)  the cheques the bank has paid and any deposits received. 
C)  any other charges or additions to the bank balance. 
D)  All of these answers are correct. 
A)  the beginning bank balance of the cash at the start of the month. 
B)  the cheques the bank has paid and any deposits received. 
C)  any other charges or additions to the bank balance. 
D)  All of these answers are correct.

Question 14

Which of the following accounts would most likely be debited in the replenishment of petty cash?

Accepted Answer

A)  Cash 
B)  Petty Cash 
C)  Postage Expense 
D)  Withdrawals 
A)  Cash 
B)  Petty Cash 
C)  Postage Expense 
D)  Withdrawals

Question 15

Advantages of online banking include

Accepted Answer

A)  convenience. 
B)  transaction speed. 
C)  effectiveness. 
D)  All of the above are correct. 
A)  convenience. 
B)  transaction speed. 
C)  effectiveness. 
D)  All of the above are correct.

Question 16

Bank statements show all the following EXCEPT

Accepted Answer

A)  deposits received and cheques paid. 
B)  the beginning and ending balances shown on the bank's records. 
C)  the beginning and ending balances shown on the depositor's general ledger. 
D)  items debited and credited to the chequing account. 
A)  deposits received and cheques paid. 
B)  the beginning and ending balances shown on the bank's records. 
C)  the beginning and ending balances shown on the depositor's general ledger. 
D)  items debited and credited to the chequing account.

Question 17

A bank service charge would be included on the bank reconciliation as a(n)

Accepted Answer

A)  addition to the balance per books. 
B)  subtraction from the balance per books. 
C)  addition to the balance per bank. 
D)  subtraction from the balance per bank. 
A)  addition to the balance per books. 
B)  subtraction from the balance per books. 
C)  addition to the balance per bank. 
D)  subtraction from the balance per bank.

Question 18

The May bank statement for Accounting Services shows a balance of $6,300, but the balance per books shows a cash balance of $7,980. Other information includes 1. A cheque for $200 to pay the electric bill was recorded on the books as $20.
2) Included on the bank statement was a note collected by the bank for $300 plus interest of $30.
3) Cheques outstanding totaled $360.
4) Bank service charges were $50.
5) Deposits in transit were $2,140.
Which item(s) will require a journal entry to update the balance in the Cash account?

Accepted Answer

A)  Cheques outstanding and deposits in transit 
B)  Bank service charges, note collected by the bank, and deposits in transit 
C)  Bank service charges, note collected by the bank, and error made by Accounting Services 
D)  None of these answers are correct. 
A)  Cheques outstanding and deposits in transit 
B)  Bank service charges, note collected by the bank, and deposits in transit 
C)  Bank service charges, note collected by the bank, and error made by Accounting Services 
D)  None of these answers are correct.

Question 19

The credit recorded in the journal to replenish the petty cash fund is to

Accepted Answer

A)  Cash. 
B)  Petty Cash. 
C)  Accounts Receivable. 
D)  Accounts Payable. 
A)  Cash. 
B)  Petty Cash. 
C)  Accounts Receivable. 
D)  Accounts Payable.

Question 20

Calculate, from the following information accumulated by Bob Verna, the adjusted cash balance at the end of July. Bank statement ending cash balance $6,000
General ledger cash balance ending 8,500
Bank monthly service charge 90
Deposits in transit 5,000
Outstanding cheques 3,000
NSF cheque returned with bank statement 410

Accepted Answer

A)  $6,000 
B)  $8,500 
C)  $8,000 
D)  $11,000 
A)  $6,000 
B)  $8,500 
C)  $8,000 
D)  $11,000

What is the purpose of internal control?

Petty Cash is an asset shown on the balance sheet.

The Petty Cash account is debited when

The person or company to whom a cheque is payable is called the

Using correct cash handling procedures, deposits should be made by the end of the week.

Transferring money without paper cheques is called electronic funds transfer.

The petty cash overage was not recorded. This would cause

The Petty Cash account should always be debited when the fund is replenished.

The auxiliary petty cash record is posted to the ledger.

How would outstanding cheques be handled when reconciling the ending cash balance per the bank statement to the correct adjusted cash balance?

The bank statement shows

Which of the following accounts would most likely be debited in the replenishment of petty cash?

Advantages of online banking include

Bank statements show all the following EXCEPT

A bank service charge would be included on the bank reconciliation as a(n)

The credit recorded in the journal to replenish the petty cash fund is to

Accounting Concepts and Procedures: an Introduction

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle: Journalizing, Posting, and the Trial Balance

The Accounting Cycle Continued: Preparing Worksheets and Financial Statements

The Accounting Cycle Completed: Closing and Post-Closing Trial Balance

Special Journals and Subsidiary Ledgers: the Basics: Sales and Cash

Special Journals and Subsidiary Ledgers: the Basics: Purchases and Cash Payments Journals

Payroll Procedures: the Employees Perspective

The Employers Tax Responsibilities: Principles and Procedures

Special Journals With Taxes

Preparing a Worksheet for a Merchandising Company

Completion of the Accounting Cycle for a Merchandising Company

Filters

Exam 8: Banking Procedures and Control of Cash

What is the purpose of internal control?

Petty Cash is an asset shown on the balance sheet.

The Petty Cash account is debited when

The person or company to whom a cheque is payable is called the

Using correct cash handling procedures, deposits should be made by the end of the week.

Transferring money without paper cheques is called electronic funds transfer.

The petty cash overage was not recorded. This would cause

The Petty Cash account should always be debited when the fund is replenished.

The auxiliary petty cash record is posted to the ledger.

How would outstanding cheques be handled when reconciling the ending cash balance per the bank statement to the correct adjusted cash balance?

The bank statement shows

Which of the following accounts would most likely be debited in the replenishment of petty cash?

Advantages of online banking include

Bank statements show all the following EXCEPT

A bank service charge would be included on the bank reconciliation as a(n)

The credit recorded in the journal to replenish the petty cash fund is to

Accounting Concepts and Procedures: an Introduction

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle: Journalizing, Posting, and the Trial Balance

The Accounting Cycle Continued: Preparing Worksheets and Financial Statements

The Accounting Cycle Completed: Closing and Post-Closing Trial Balance

Special Journals and Subsidiary Ledgers: the Basics: Sales and Cash

Special Journals and Subsidiary Ledgers: the Basics: Purchases and Cash Payments Journals

Payroll Procedures: the Employees Perspective

The Employers Tax Responsibilities: Principles and Procedures

Special Journals With Taxes

Preparing a Worksheet for a Merchandising Company

Completion of the Accounting Cycle for a Merchandising Company

Filters