Exam 8: Internal Control and Cash

Cashiers and mail room employees who handle cash do not have access to the accounting records. Accountants who record cash receipts do not have on opportunity to handle cash. This is an internal control feature illustrating proper separation of duties.

A deposit in transit has been recorded by the bank but not the company.

In a bank reconciliation, an EFT cash receipt is:

A cheque for the cash purchase of supplies for $239 was recorded on the books as $329. On a bank reconciliation, this will appear as a(n):

The following information is needed to reconcile the cash balance for Woods Paper Products. • A deposit of $5,794.62 is in transit. • Outstanding cheques total $1,533.25. • The book balance is $5,695.62. • The bookkeeper recorded a $1,524.00 cheque as $15,240 in payment of the current month's rent. • The bank balance at February 28, 2008 was $16,500.25. • A deposit of $300 was credited by the bank for $3,000. • A customer's cheque for $1,280 was returned for non-sufficient funds. • The bank service charge is $70. Based on this information, complete a bank reconciliation, in the format below, for Woods Paper Products as of February 28, 2017. BANK BOОК

External auditors are entirely independent of a business.

Keeping office supplies under lock and key is representative of:

Marvin Gardens received a bank statement showing a balance of $1,300. What is the adjusted balance if there was a bookkeeper error of $150 in the depositor's favour, two outstanding cheques totalling $40, a service charge of $10, a deposit in transit of $150, and interest revenue of $26 earned by the depositor?

Which of the following is the last step in the daily control over cash receipts by mail?

It is poor planning to have employees rotate through jobs.

A Trojan hides inside a legitimate program and works like a virus.

All of the following are documents used to control a bank account except a(n):

Cash is the first asset listed on the balance sheet because it is:

Table 8-1 The petty cash fund had the following petty cash ticket: Toner for a printer \ 42 Freight to deliver goods sold 39 Freight on inventory purchased. 112 Miscellaneous expense 10 Postage expense -Refer to Table 8-1. Assume that the business has established a petty cash fund in the amount of $250 and that the amount of cash in the fund at the time of replenishment is $20. The business uses a periodic inventory system. Prepare the entry to replenish the fund on February 28.

On August 1, 2019, Rubble Station established a $350 petty cash fund. At the end of August, the petty cash fund contained: - Cash on hand $\quad ~~~~~~~~~~~~~~~~~\$ 65.25$ - Petty cash tickets for postage \ 95.50 office supplies 94.50 miscellaneous items 99.25 a)Prepare the journal entry to establish the petty cash fund on August 1, 2019. b)Prepare the journal entry on August 31, 2019, to replenish the petty cash fund. c)Assume on August 31, 2019, after replenishing the petty cash fund, Rubble Station desires to increase the petty cash fund to $400. Prepare the necessary journal entry.

A petty cash fund was established with a $400 balance. It currently has cash of $10 and petty cash tickets as shown below. Travel expense \ 120 Office supplies \ 200 Equipment rental expense \ 70 The journal entry to replenish the account would be which of the following?

The Candy Place received a bank statement showing a balance of $5,350. What is the adjusted balance if there was a bookkeeper error of $200 in the depositor's favour, two outstanding cheques totalling $720, a service charge of $15, a deposit in transit of $165, and interest revenue of $21 earned by the depositor?

The employee who processes cash payments should have nothing to do with the approval process. This is a part of which characteristic of internal control?

Interest revenue appears on a bank reconciliation as a(n):

Discuss the specific characteristics of an effective system of internal control for cash receipts over the counter.