Exam 8: Internal Control and Cash

In reconciling a bank statement, the bank balance is $1,500, and the checkbook balance is $2,105. Which of the following is the most probable reason for the checkbook balance being larger than the bank balance?

A petty cash fund was established with a $250 balance. It currently has cash of $38 and petty cash tickets totaling $212 for travel expense. Provide the journal entry to record the replenishment of the fund.

For the following situation, state whether it represents a strength or weakness in internal control and give the reason for your answer. The bookkeeper opens the mail, makes the deposit, and makes the journal entries to record receipt of the cash and checks.

Journal entries that are necessitated by reconciling items on the book side of the reconciliation include either a debit to Cash or a credit to Cash.

Which is the most liquid form of asset?

Debit card transactions are considered electronic funds transfer.

A petty cash fund was established with a $600 balance. It currently has cash of $18 and petty cash tickets as shown below: Which of the following would be included in the journal entry to replenish the Petty Cash fund?

The difference that arises between the balance on the bank statement and the balance on the company's books because of a time lag in recording transactions is known as a timing difference.

Which of the following is an objective of internal control?

Which of the following describes a firewall?

The environment is the culture of a business, and it starts with the CEO or CFO and the top managers.

A company has a petty cash fund amount of $200. When replenished, it has petty cash receipts of $32 for gas expense, $33 for postage expense, $14 for supplies expense, and $9 for miscellaneous expenses. Assume the cash balance is not over or short. In the journal entry, Cash would be credited for ________.

Which of the following is the basic internal control measure for cash?

A signature card is a card that shows each authorized person's signature for a bank account.

If the bank reconciliation includes a bank service charge, a journal entry is required, which debits Bank Expense and credits Cash.

Which of the following components of internal control consists of work performed by internal and external auditors?

A petty cash fund was established with a $250 balance. It currently has cash of $40 and petty cash tickets as follows: Office expense $150 and Entertainment Expense $75. Which of the following would be included in the journal entry to replenish the Petty Cash fund?

Vaughn Services hires a new accountant to maintain its petty cash fund. Although the employee possesses an accounting degree, he/she had been previously convicted of embezzlement. Which internal control procedure needs to be addressed in the above situation?

A company's Cash account shows an ending balance of $4,400. Reconciling items included a bookkeeper error of $100 (a $500 check recorded as $600), two outstanding checks totaling $810, a service charge of $25, a deposit in transit of $250, and interest revenue of $30. What is the adjusted book balance?

As proof of the deposit transaction, a customer receives a cancelled check from the bank.