Question 1

If the bank records a deposit of $1,500 as $150, the error should be shown on a bank reconciliation as an):

Accepted Answer

A) addition to the bank balance of $1,350. 
B) addition to the book balance of $1,350. 
C) deduction from the bank balance of $1,350. 
D) deduction from the book balance of $1,350. 
A) addition to the bank balance of $1,350. 
B) addition to the book balance of $1,350. 
C) deduction from the bank balance of $1,350. 
D) deduction from the book balance of $1,350. A

Question 2

Which of the following steps should be performed by the accounting department prior to the approval of a disbursement?

Accepted Answer

A) The mathematical accuracy of the invoice should be proved. 
B) The check should be processed and signed by the purchasing department supervisor. 
C) The invoice should be compared with a copy of the purchase order and invoice. 
D) The invoice should be compared with the disbursing report. 
A) The mathematical accuracy of the invoice should be proved. 
B) The check should be processed and signed by the purchasing department supervisor. 
C) The invoice should be compared with a copy of the purchase order and invoice. 
D) The invoice should be compared with the disbursing report. A

Question 3

If a bank statement included a bank collection and related interest revenue, the journal entry to record this reconciling item should include a:

Accepted Answer

A) credit to Cash. 
B) debit to Note Payable. 
C) debit to Note Receivable. 
D) debit to Cash. 
A) credit to Cash. 
B) debit to Note Payable. 
C) debit to Note Receivable. 
D) debit to Cash. D

Question 4

There are two records of a business's cash-the:

Accepted Answer

A) bank statement and the cash in petty cash. 
B) cash account in the general ledger and the journal entries from the bank reconciliation. 
C) bank statement and the cash account in the general ledger. 
D) cash account in the general ledger and the petty cash box. 
A) bank statement and the cash in petty cash. 
B) cash account in the general ledger and the journal entries from the bank reconciliation. 
C) bank statement and the cash account in the general ledger. 
D) cash account in the general ledger and the petty cash box.

Question 5

A fidelity bond is an):

Accepted Answer

A) contract prohibiting former employees from working for a competitor. 
B) insurance policy that reimburses a company for employee theft. 
C) employment contract for a specified period of time. 
D) promise by a company to safeguard customers' personal information. 
A) contract prohibiting former employees from working for a competitor. 
B) insurance policy that reimburses a company for employee theft. 
C) employment contract for a specified period of time. 
D) promise by a company to safeguard customers' personal information.

Question 6

When a company receives cash by mail, the bank deposit for the cash receipts should be made by the:

Accepted Answer

A) controller. 
B) mail room clerk. 
C) certified public accountant. 
D) treasurer. 
A) controller. 
B) mail room clerk. 
C) certified public accountant. 
D) treasurer.

Question 7

Albert Company's accountant considered the following items: cash in a checking account, $1,400; cash in a time deposit account, $450; cash pledged as collateral, $250. How much should appear as Cash on the balance sheet?

Accepted Answer

A) $1,650 
B) $2,100 
C) $1,200 
D) $1,850 
A) $1,650 
B) $2,100 
C) $1,200 
D) $1,850

Question 8

A budget is a qualitative expression of a plan that helps managers coordinate an entity's activities.

Accepted Answer

A) True 
 B)False

Question 9

A recent cash budget showed estimated cash receipts of $159,000, estimated cash disbursements of $155,000, and a desired ending cash balance of $6,000, with no borrowing of funds. The beginning cash balance was:

Accepted Answer

A) $ 2,000. 
B) $10,000. 
C) $ 4,000. 
D) There is not enough information to calculate. 
A) $ 2,000. 
B) $10,000. 
C) $ 4,000. 
D) There is not enough information to calculate.

Question 10

Both internal audits and external audits examine company processes.

Accepted Answer

A) True 
 B)False

Question 11

The checks that have been paid by the bank on behalf of the depositor, which are included with the bank statement, are called:

Accepted Answer

A) outstanding checks. 
B) NSF checks. 
C) checks in transit. 
D) canceled checks. 
A) outstanding checks. 
B) NSF checks. 
C) checks in transit. 
D) canceled checks.

Question 12

The bank statement balance is $6,450 and shows a service charge of $30, interest earned of $25, and an NSF check for $475. Deposits in transit total $1,850; outstanding checks are $1,125. What is the adjusted book balance?

Accepted Answer

A) $7,175 
B) $5,725 
C) $7,655 
D) $5,970 
A) $7,175 
B) $5,725 
C) $7,655 
D) $5,970

Question 13

The three parties to a check transaction are the maker, the payee and the bank.

Accepted Answer

A) True 
 B)False

Question 14

Many businesses have their customers pay directly to a special post office box. This system is known as an):

Accepted Answer

A) imprest system. 
B) bank account reconciliation system. 
C) EFT system. 
D) lock- box system. 
A) imprest system. 
B) bank account reconciliation system. 
C) EFT system. 
D) lock- box system.

Question 15

Differences between the bank statement and the company's Cash account are primarily the result of timing errors made by the company.

Accepted Answer

A) True 
 B)False

Question 16

An imprest petty cash fund of $400 was established for minor disbursements. At the end of the month the fund included petty cash tickets for the purchase of $185 in supplies, $41 for postage, $86 for fuel and a delivery charge of $65. How much cash is left in the fund if there is no shortage or overage?

Accepted Answer

A) $ 23 
B) $174 
C) $ 88 
D) $377 
A) $ 23 
B) $174 
C) $ 88 
D) $377

Question 17

When preparing a bank reconciliation, which of the following items should be subtracted from the bank balance?

Accepted Answer

A) Outstanding checks 
B) Deposits in transit 
C) EFT cash receipts 
D) Bank service charges 
A) Outstanding checks 
B) Deposits in transit 
C) EFT cash receipts 
D) Bank service charges

Question 18

The journal entry for a NSF check involves a credit to Accounts Receivable.

Accepted Answer

A) True 
 B)False

Question 19

The company's has the primary responsibility for establishing and maintaining a company's system of internal control.

Accepted Answer

A) stockholders 
B) internal auditors 
C) external auditors 
D) top management 
A) stockholders 
B) internal auditors 
C) external auditors 
D) top management

Question 20

The treasurer is the chief accounting officer in an organization.

Accepted Answer

A) True 
 B)False

If the bank records a deposit of $1,500 as $150, the error should be shown on a bank reconciliation as an):

Which of the following steps should be performed by the accounting department prior to the approval of a disbursement?

If a bank statement included a bank collection and related interest revenue, the journal entry to record this reconciling item should include a:

There are two records of a business's cash-the:

A fidelity bond is an):

When a company receives cash by mail, the bank deposit for the cash receipts should be made by the:

Albert Company's accountant considered the following items: cash in a checking account, $1,400; cash in a time deposit account, $450; cash pledged as collateral, $250. How much should appear as Cash on the balance sheet?

A budget is a qualitative expression of a plan that helps managers coordinate an entity's activities.

A recent cash budget showed estimated cash receipts of $159,000, estimated cash disbursements of $155,000, and a desired ending cash balance of $6,000, with no borrowing of funds. The beginning cash balance was:

Both internal audits and external audits examine company processes.

The checks that have been paid by the bank on behalf of the depositor, which are included with the bank statement, are called:

The bank statement balance is $6,450 and shows a service charge of $30, interest earned of $25, and an NSF check for $475. Deposits in transit total $1,850; outstanding checks are $1,125. What is the adjusted book balance?

The three parties to a check transaction are the maker, the payee and the bank.

Many businesses have their customers pay directly to a special post office box. This system is known as an):

Differences between the bank statement and the company's Cash account are primarily the result of timing errors made by the company.

When preparing a bank reconciliation, which of the following items should be subtracted from the bank balance?

The journal entry for a NSF check involves a credit to Accounts Receivable.

The company's has the primary responsibility for establishing and maintaining a company's system of internal control.

The treasurer is the chief accounting officer in an organization.

The Financial Statements

Transaction Analysis

Accrual Accounting and Income

Short-Term Investments Receivables

Inventory and Cost of Goods Sold

Plant Assets and Intangibles

Liabilities

Stockholders Equity

Long-Term Investments and International Operations

The Income Statement and the Statement of Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

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Exam 4: Internal Control and Cash

If the bank records a deposit of $1,500 as $150, the error should be shown on a bank reconciliation as an):

Which of the following steps should be performed by the accounting department prior to the approval of a disbursement?

If a bank statement included a bank collection and related interest revenue, the journal entry to record this reconciling item should include a:

There are two records of a business's cash-the:

A fidelity bond is an):

When a company receives cash by mail, the bank deposit for the cash receipts should be made by the:

Albert Company's accountant considered the following items: cash in a checking account, $1,400; cash in a time deposit account, $450; cash pledged as collateral, $250. How much should appear as Cash on the balance sheet?

A budget is a qualitative expression of a plan that helps managers coordinate an entity's activities.

A recent cash budget showed estimated cash receipts of $159,000, estimated cash disbursements of $155,000, and a desired ending cash balance of $6,000, with no borrowing of funds. The beginning cash balance was:

Both internal audits and external audits examine company processes.

The checks that have been paid by the bank on behalf of the depositor, which are included with the bank statement, are called:

The bank statement balance is $6,450 and shows a service charge of $30, interest earned of $25, and an NSF check for $475. Deposits in transit total $1,850; outstanding checks are $1,125. What is the adjusted book balance?

The three parties to a check transaction are the maker, the payee and the bank.

Many businesses have their customers pay directly to a special post office box. This system is known as an):

Differences between the bank statement and the company's Cash account are primarily the result of timing errors made by the company.

When preparing a bank reconciliation, which of the following items should be subtracted from the bank balance?

The journal entry for a NSF check involves a credit to Accounts Receivable.

The company's has the primary responsibility for establishing and maintaining a company's system of internal control.

The treasurer is the chief accounting officer in an organization.

The Financial Statements

Transaction Analysis

Accrual Accounting and Income

Short-Term Investments Receivables

Inventory and Cost of Goods Sold

Plant Assets and Intangibles

Liabilities

Stockholders Equity

Long-Term Investments and International Operations

The Income Statement and the Statement of Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Filters