Question 1

In large companies, the independent internal verification procedure is often assigned to

Accepted Answer

A) computer operators. 
B) management. 
C) internal auditors. 
D) outside auditors. 
A) computer operators. 
B) management. 
C) internal auditors. 
D) outside auditors. C

Question 2

Which one of the following would not cause a bank to debit a depositor's account?

Accepted Answer

A) Bank service charge 
B) Collection of a note receivable 
C) Wiring of funds to other locations 
D) Checks marked NSF 
A) Bank service charge 
B) Collection of a note receivable 
C) Wiring of funds to other locations 
D) Checks marked NSF B

Question 3

Jeter Company developed the following reconciling information in preparing its September bank reconciliation: $\begin{array}{lr}
\text { Cash balance per bank, } 9 / 30 & \$ 15,400 \
\text { Note receivable collected by bank } & 8,400 \
\text { Outstanding checks } & 12,600 \
\text { Deposits in transit } & 6,300 \
\text { Bank service charge } & 105 \
\text { NSF check } & 1,680
\end{array}$ 
Using the above information, determine the cash balance per books (before adjustments) for the Jeter Company.

Accepted Answer

A) $13,685 
B) $21,700 
C) $2,485 
D) $21,000 
A) $13,685 
B) $21,700 
C) $2,485 
D) $21,000 C

Question 4

In preparing its August 31, 2011 bank reconciliation, Acme Corp.has available the following information: $\begin{array}{lr}
\text { Balance per bank statement, } 8 / 31 / 11 & \$ 21,650 \
\text { Deposit in transit, } 8 / 31 / 11 & 3,900 \
\text { Return of customer's check not sufficient funds, } 8 / 30 / 10 & 600 \
\text { Outstanding checks, } 8 / 31 / 11 & 2,750 \
\text { Bank service charges for August } & 100
\end{array}$ At August 31, 2011, Acme's adjusted cash balance is

Accepted Answer

A) $22,800. 
B) $22,200. 
C) $22,100. 
D) $20,500. 
A) $22,800. 
B) $22,200. 
C) $22,100. 
D) $20,500.

Question 5

A petty cash fund should be replenished

Accepted Answer

A) every day. 
B) at the end of every accounting period. 
C) once a year. 
D) as soon as an expense is paid from the fund. 
A) every day. 
B) at the end of every accounting period. 
C) once a year. 
D) as soon as an expense is paid from the fund.

Question 6

An employee authorized to sign checks should not record

Accepted Answer

A) owner cash contributions. 
B) mail receipts. 
C) cash disbursement transactions. 
D) sales transactions. 
A) owner cash contributions. 
B) mail receipts. 
C) cash disbursement transactions. 
D) sales transactions.

Question 7

Cash register overages are deposited in the petty cash fund and cash shortages are made-up from the petty cash fund.

Accepted Answer

A) True 
 B)False

Question 8

Certificates of deposit are currently classified as cash on the statement of financial position.

Accepted Answer

A) True 
 B)False

Question 9

At April 30, Mareska Company has the following bank information: cash balance per bank $ € 4,600 $; outstanding checks $ € 280 $; deposits in transit $ € 550 $; credit memo for interest $ € 10 $; bank service charge $ € 20 $. What is Mareska's adjusted cash balance on April 30 ?

Accepted Answer

A)  $€ 4,860$ 
B)  $€ 4,880$ 
C)  $€ 4,330$ 
D)  $€ 4,870$ 
A)  $€ 4,860$ 
B)  $€ 4,880$ 
C)  $€ 4,330$ 
D)  $€ 4,870$

Question 10

Use the following information to answer questions . On October 2, 2011, Bienvenu Manufacturing Company established a petty cash fund by issuing a check for $€ 350$ to the custodian of the petty cash fund. On October 31, 2011, The custodian submitted the following paid petty cash vouchers for replenishment of the petty cash fund when there is $€ 15$ cash in the fund:
$\begin{array} { l r } \text { Freight-in } & € 145 \ \text { Office Supplies Expense } & 55 \ \text { Entertainment of clients } & 89 \ \text { Postage Expense } & 50 \end{array}$
-The journal entry to establish the petty cash fund would include a

Accepted Answer

A)  credit to cash for $€ 350$. 
B)  credit to Cash Over and Short for $€ 350$. 
C)  credit to Accounts Receivable for $€ 350$. 
D)  Credit to Accounts payable for $€ 350$. 
A)  credit to cash for $€ 350$. 
B)  credit to Cash Over and Short for $€ 350$. 
C)  credit to Accounts Receivable for $€ 350$. 
D)  Credit to Accounts payable for $€ 350$.

Question 11

In the month of November, Coler Company Inc.wrote checks in the amount of $18,500.In December, checks in the amount of $25,316 were written.In November, $16,936 of these checks were presented to the bank for payment, and $21,766 were presented in December.What is the amount of outstanding checks at the end of December?

Accepted Answer

A) $3,550 
B) $1,564 
C) $5,114 
D) $7,100 
A) $3,550 
B) $1,564 
C) $5,114 
D) $7,100

Question 12

A company stamps checks received in the mail with the words "For Deposit Only".This endorsement is called a(n)

Accepted Answer

A) blank endorsement. 
B) rubber stamp. 
C) restrictive endorsement. 
D) operational endorsement. 
A) blank endorsement. 
B) rubber stamp. 
C) restrictive endorsement. 
D) operational endorsement.

Question 13

The daily cash count of cash register receipts made by department supervisors is an example of

Accepted Answer

A) human resource controls. 
B) independent internal verification. 
C) establishment of responsibility. 
D) segregation of duties. 
A) human resource controls. 
B) independent internal verification. 
C) establishment of responsibility. 
D) segregation of duties.

Question 14

Allowing only the treasurer to sign checks is an example of

Accepted Answer

A) documentation procedures. 
B) segregation of duties. 
C) human resource controls. 
D) establishment of responsibility. 
A) documentation procedures. 
B) segregation of duties. 
C) human resource controls. 
D) establishment of responsibility.

Question 15

In preparing its bank reconciliation for the month of April 2011, Franklin, Inc.has available the following information. 
$\begin{array}{lr}\text { Balance per bank statement, } 4 / 30 / 11&\$39,140\
\text { NSF check returned with } 4 / 30 / 11 \text { bank statement } & 450 \
\text { Deposits in transit, } 4 / 30 / 11 & 5,000 \
\text { Outstanding checks, } 4 / 30 / 11 & 5,200 \
\text { Bank service charges for April } & 20
\end{array}$ What should be the adjusted cash balance at April 30, 2011?

Accepted Answer

A) $39,370. 
B) $38,940. 
C) $38,490. 
D) $38,470. 
A) $39,370. 
B) $38,940. 
C) $38,490. 
D) $38,470.

Question 16

Short-term, highly liquid investments are currently reported as short-term investments on the statement of financial position.

Accepted Answer

A) True 
 B)False

Question 17

A $100 petty cash fund has cash of $17 and receipts of $80.The journal entry to replenish the account would include a

Accepted Answer

A) debit to Cash for $80. 
B) credit to Petty Cash for $83. 
C) debit to Cash Over and Short for $3. 
D) credit to Cash for $80. 
A) debit to Cash for $80. 
B) credit to Petty Cash for $83. 
C) debit to Cash Over and Short for $3. 
D) credit to Cash for $80.

Question 18

The responsibility for ordering, receiving, and paying for merchandise should be assigned to different individuals.

Accepted Answer

A) True 
 B)False

Question 19

Checks received in the mail should be immediately stamped "NSF" to prevent unauthorized cashing of the check.

Accepted Answer

A) True 
 B)False

Question 20

In general, documents should be prenumbered and all documents should be accounted for.

Accepted Answer

A) True 
 B)False

In large companies, the independent internal verification procedure is often assigned to

Which one of the following would not cause a bank to debit a depositor's account?

A petty cash fund should be replenished

An employee authorized to sign checks should not record

Cash register overages are deposited in the petty cash fund and cash shortages are made-up from the petty cash fund.

Certificates of deposit are currently classified as cash on the statement of financial position.

At April 30, Mareska Company has the following bank information: cash balance per bank $€ 4,600$ ; outstanding checks $€ 280$ ; deposits in transit $€ 550$ ; credit memo for interest $€ 10$ ; bank service charge $€ 20$ . What is Mareska's adjusted cash balance on April 30 ?

A company stamps checks received in the mail with the words "For Deposit Only".This endorsement is called a(n)

The daily cash count of cash register receipts made by department supervisors is an example of

Allowing only the treasurer to sign checks is an example of

Short-term, highly liquid investments are currently reported as short-term investments on the statement of financial position.

A $100 petty cash fund has cash of $17 and receipts of $80.The journal entry to replenish the account would include a

The responsibility for ordering, receiving, and paying for merchandise should be assigned to different individuals.

Checks received in the mail should be immediately stamped "NSF" to prevent unauthorized cashing of the check.

In general, documents should be prenumbered and all documents should be accounted for.

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, Share Transactions, Dividends,and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 7: Fraud, Internal Control, and Cash

In large companies, the independent internal verification procedure is often assigned to

Which one of the following would not cause a bank to debit a depositor's account?

A petty cash fund should be replenished

An employee authorized to sign checks should not record

Cash register overages are deposited in the petty cash fund and cash shortages are made-up from the petty cash fund.

Certificates of deposit are currently classified as cash on the statement of financial position.

A company stamps checks received in the mail with the words "For Deposit Only".This endorsement is called a(n)

The daily cash count of cash register receipts made by department supervisors is an example of

Allowing only the treasurer to sign checks is an example of

Short-term, highly liquid investments are currently reported as short-term investments on the statement of financial position.

A $100 petty cash fund has cash of $17 and receipts of $80.The journal entry to replenish the account would include a

The responsibility for ordering, receiving, and paying for merchandise should be assigned to different individuals.

Checks received in the mail should be immediately stamped "NSF" to prevent unauthorized cashing of the check.

In general, documents should be prenumbered and all documents should be accounted for.

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, Share Transactions, Dividends,and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters