Question 1

Replenishing the petty cash fund requires

Accepted Answer

A)  a debit to Cash. 
B)  a credit to Petty Cash. 
C)  a debit to various expense accounts. 
D)  no accounting entry. 
A)  a debit to Cash. 
B)  a credit to Petty Cash. 
C)  a debit to various expense accounts. 
D)  no accounting entry.

Question 2

The custodian of the petty cash fund has the responsibility of recording a journal entry every time cash is used from the fund.

Accepted Answer

A) True 
 B)False

Question 3

If a company deposits all its receipts in the bank and pays all its bills by check, then the monthly bank statement balance will always agree with the company's record of its checking account balance.

Accepted Answer

A) True 
 B)False

Question 4

Cash is defined by IFRS as

Accepted Answer

A)  cash on hand. 
B)  demand deposits. 
C)  cash on hand and demand deposits. 
D)  cash on hand, demand deposits, and highly liquid investments.
IFRS 
A)  cash on hand. 
B)  demand deposits. 
C)  cash on hand and demand deposits. 
D)  cash on hand, demand deposits, and highly liquid investments.
IFRS

Question 5

Fitzgerald Company wrote checks totaling $34,160 during October and $37,300 during November. $32,480 of these checks cleared the bank in October, and $36,440 cleared the bank in November. What was the amount of outstanding checks on November 30?

Accepted Answer

A)  $2,860 
B)  $1,680 
C)  $2,540 
D)  $3,140 
A)  $2,860 
B)  $1,680 
C)  $2,540 
D)  $3,140

Question 6

Cash equivalents are defined by IFRS as

Accepted Answer

A)  cash on hand. 
B)  demand deposits. 
C)  cash on hand and demand deposits. 
D)  short-term, highly liquid investments that are readily convertible into known amounts of cash.
IFRS 
A)  cash on hand. 
B)  demand deposits. 
C)  cash on hand and demand deposits. 
D)  short-term, highly liquid investments that are readily convertible into known amounts of cash.
IFRS

Question 7

An accounts payable clerk also has access to the approved supplier master file for purchases. The control principle of

Accepted Answer

A)  establishment of responsibility is violated. 
B)  independent internal verification is violated. 
C)  documentation procedures is violated. 
D)  segregation of duties is violated. 
A)  establishment of responsibility is violated. 
B)  independent internal verification is violated. 
C)  documentation procedures is violated. 
D)  segregation of duties is violated.

Question 8

In the month of May, Kijak Company Inc. wrote checks in the amount of $84,000. In June, checks in the amount of $114,000 were written. In May, $75,000 of these checks were presented to the bank for payment, and $99,000 in June. What is the amount of outstanding checks at the end of May?

Accepted Answer

A)  $9,000 
B)  $15,000 
C)  $24,000 
D)  $30,000 
A)  $9,000 
B)  $15,000 
C)  $24,000 
D)  $30,000

Question 9

The principles of internal control activities are used

Accepted Answer

A)  in the U.S. but not globally. 
B)  internationally but not in the U.S. 
C)  in the U.S. and Canada but not globally. 
D)  globally.
IFRS 
A)  in the U.S. but not globally. 
B)  internationally but not in the U.S. 
C)  in the U.S. and Canada but not globally. 
D)  globally.
IFRS

Question 10

An adjusting entry is not required for

Accepted Answer

A)  outstanding checks. 
B)  collection of a note by the bank. 
C)  NSF checks. 
D)  bank service charges. 
A)  outstanding checks. 
B)  collection of a note by the bank. 
C)  NSF checks. 
D)  bank service charges.

Question 11

Internal control consists of the plan of organization and all of the related methods and measures adopted within a business to (a) safeguard its assets, and (b) enhance the accuracy and reliability of its accounting records.

Accepted Answer

A) True 
 B)False

Question 12

Jolene is warehouse custodian and also maintains the accounting record of the inventory held at the warehouse. An assessment of this situation indicates

Accepted Answer

A)  documentation procedures are violated. 
B)  independent internal verification is violated. 
C)  segregation of duties is violated. 
D)  establishment of responsibility is violated. 
A)  documentation procedures are violated. 
B)  independent internal verification is violated. 
C)  segregation of duties is violated. 
D)  establishment of responsibility is violated.

Question 13

In preparing a bank reconciliation, outstanding checks are

Accepted Answer

A)  added to the balance per bank. 
B)  deducted from the balance per books. 
C)  added to the balance per books. 
D)  deducted from the balance per bank. 
A)  added to the balance per bank. 
B)  deducted from the balance per books. 
C)  added to the balance per books. 
D)  deducted from the balance per bank.

Question 14

The most important element of the fraud triangle is

Accepted Answer

A)  financial pressure. 
B)  incompatible duties. 
C)  opportunity. 
D)  rationalization. 
A)  financial pressure. 
B)  incompatible duties. 
C)  opportunity. 
D)  rationalization.

Question 15

The responsibility for keeping the records for an asset should be separate from the physical custody of that asset.

Accepted Answer

A) True 
 B)False

Question 16

A petty cash fund of $100 is replenished when the fund contains $4 in cash and receipts for $93. The entry to replenish the fund would

Accepted Answer

A)  credit Cash Over and Short for $3. 
B)  credit Miscellaneous Revenue for $3. 
C)  debit Cash Over and Short for $3. 
D)  debit Miscellaneous Expense for $3. 
A)  credit Cash Over and Short for $3. 
B)  credit Miscellaneous Revenue for $3. 
C)  debit Cash Over and Short for $3. 
D)  debit Miscellaneous Expense for $3.

Question 17

Physical controls to safeguard assets do not include

Accepted Answer

A)  cashier department supervisors. 
B)  vaults. 
C)  employee identification badges. 
D)  security guards. 
A)  cashier department supervisors. 
B)  vaults. 
C)  employee identification badges. 
D)  security guards.

Question 18

The principles of internal control include all of the following except

Accepted Answer

A)  establishment of responsibility. 
B)  combining of duties. 
C)  physical, mechanical, and electronic controls. 
D)  independent internal verification. 
A)  establishment of responsibility. 
B)  combining of duties. 
C)  physical, mechanical, and electronic controls. 
D)  independent internal verification.

Question 19

The custodian of a company asset should

Accepted Answer

A)  have access to the accounting records for that asset. 
B)  be someone outside the company. 
C)  not have access to the accounting records for that asset. 
D)  be an accountant. 
A)  have access to the accounting records for that asset. 
B)  be someone outside the company. 
C)  not have access to the accounting records for that asset. 
D)  be an accountant.

Question 20

Firms use physical controls primarily to safeguard their assets.

Accepted Answer

A) True 
 B)False

Replenishing the petty cash fund requires

The custodian of the petty cash fund has the responsibility of recording a journal entry every time cash is used from the fund.

If a company deposits all its receipts in the bank and pays all its bills by check, then the monthly bank statement balance will always agree with the company's record of its checking account balance.

Cash is defined by IFRS as

Fitzgerald Company wrote checks totaling $34,160 during October and $37,300 during November. $32,480 of these checks cleared the bank in October, and $36,440 cleared the bank in November. What was the amount of outstanding checks on November 30?

Cash equivalents are defined by IFRS as

An accounts payable clerk also has access to the approved supplier master file for purchases. The control principle of

In the month of May, Kijak Company Inc. wrote checks in the amount of $84,000. In June, checks in the amount of $114,000 were written. In May, $75,000 of these checks were presented to the bank for payment, and $99,000 in June. What is the amount of outstanding checks at the end of May?

The principles of internal control activities are used

An adjusting entry is not required for

Internal control consists of the plan of organization and all of the related methods and measures adopted within a business to (a) safeguard its assets, and (b) enhance the accuracy and reliability of its accounting records.

Jolene is warehouse custodian and also maintains the accounting record of the inventory held at the warehouse. An assessment of this situation indicates

In preparing a bank reconciliation, outstanding checks are

The most important element of the fraud triangle is

The responsibility for keeping the records for an asset should be separate from the physical custody of that asset.

A petty cash fund of $100 is replenished when the fund contains $4 in cash and receipts for $93. The entry to replenish the fund would

Physical controls to safeguard assets do not include

The principles of internal control include all of the following except

The custodian of a company asset should

Firms use physical controls primarily to safeguard their assets.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting

Filters

Exam 7: Fraud, Internal Control, and Cash

Replenishing the petty cash fund requires

The custodian of the petty cash fund has the responsibility of recording a journal entry every time cash is used from the fund.

If a company deposits all its receipts in the bank and pays all its bills by check, then the monthly bank statement balance will always agree with the company's record of its checking account balance.

Cash is defined by IFRS as

Fitzgerald Company wrote checks totaling $34,160 during October and $37,300 during November. $32,480 of these checks cleared the bank in October, and $36,440 cleared the bank in November. What was the amount of outstanding checks on November 30?

Cash equivalents are defined by IFRS as

An accounts payable clerk also has access to the approved supplier master file for purchases. The control principle of

In the month of May, Kijak Company Inc. wrote checks in the amount of $84,000. In June, checks in the amount of $114,000 were written. In May, $75,000 of these checks were presented to the bank for payment, and $99,000 in June. What is the amount of outstanding checks at the end of May?

The principles of internal control activities are used

An adjusting entry is not required for

Internal control consists of the plan of organization and all of the related methods and measures adopted within a business to (a) safeguard its assets, and (b) enhance the accuracy and reliability of its accounting records.

Jolene is warehouse custodian and also maintains the accounting record of the inventory held at the warehouse. An assessment of this situation indicates

In preparing a bank reconciliation, outstanding checks are

The most important element of the fraud triangle is

The responsibility for keeping the records for an asset should be separate from the physical custody of that asset.

A petty cash fund of $100 is replenished when the fund contains $4 in cash and receipts for $93. The entry to replenish the fund would

Physical controls to safeguard assets do not include

The principles of internal control include all of the following except

The custodian of a company asset should

Firms use physical controls primarily to safeguard their assets.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Managerial Accounting

Filters