Question 1

Which of the following would be deducted from the ending cash balance per bank when performing a bank reconciliation?

Accepted Answer

A)  Electronic fund transfers 
B)  Service charges 
C)  Deposits in transit 
D)  Outstanding checks 
A)  Electronic fund transfers 
B)  Service charges 
C)  Deposits in transit 
D)  Outstanding checks

Question 2

The use of sequentially numbered checks is an example of:

Accepted Answer

A)  establishment of responsibility. 
B)  segregation of duties. 
C)  document procedures. 
D)  independent verification. 
A)  establishment of responsibility. 
B)  segregation of duties. 
C)  document procedures. 
D)  independent verification.

Question 3

Which of the following is deducted from the bank balance on a bank reconciliation?

Accepted Answer

A)  Deposits in transit 
B)  Outstanding checks 
C)  EFT received from customers 
D)  Bank service charge 
A)  Deposits in transit 
B)  Outstanding checks 
C)  EFT received from customers 
D)  Bank service charge

Question 4

The purpose of internal controls includes all of the following except:

Accepted Answer

A)  improving efficiency. 
B)  producing timely accounting information. 
C)  minimizing errors. 
D)  completely eliminating fraud. 
A)  improving efficiency. 
B)  producing timely accounting information. 
C)  minimizing errors. 
D)  completely eliminating fraud.

Question 5

Which of the following is not a significant objective of the Sarbanes-Oxley (SOX)Act?

Accepted Answer

A)  Conceal fraud 
B)  Encourage good character 
C)  Counteract incentives for fraud 
D)  Reduce opportunities for fraud 
A)  Conceal fraud 
B)  Encourage good character 
C)  Counteract incentives for fraud 
D)  Reduce opportunities for fraud

Question 6

Which of the following statements correctly describes an imprest system?

Accepted Answer

A)  An imprest system is an internal control procedure relating to cash receipts. 
B)  There is no difference between a petty cash fund and an imprest bank account. 
C)  If the transfers from the payroll account to the employees' checking accounts occur without error, the imprest payroll bank account will equal zero after all employees have been paid. 
D)  The use of an imprest system eliminates the need for bank reconciliations. 
A)  An imprest system is an internal control procedure relating to cash receipts. 
B)  There is no difference between a petty cash fund and an imprest bank account. 
C)  If the transfers from the payroll account to the employees' checking accounts occur without error, the imprest payroll bank account will equal zero after all employees have been paid. 
D)  The use of an imprest system eliminates the need for bank reconciliations.

Question 7

Mason Company gathered the following information from its accounting records and the October bank statement to prepare the October bank reconciliation:
  
-Use the information above to answer the following question.What journal entry would Mason Company be required to record for the interest received from the bank?

Accepted Answer

A)  debit Interest Revenue and credit Cash for $850 
B)  No journal entry is required because the bank is aware of the interest payment 
C)  debit Interest Receivable and credit Interest Revenue for $850 
D)  debit Cash and credit Interest Revenue for $850 
A)  debit Interest Revenue and credit Cash for $850 
B)  No journal entry is required because the bank is aware of the interest payment 
C)  debit Interest Receivable and credit Interest Revenue for $850 
D)  debit Cash and credit Interest Revenue for $850

Question 8

A cash register does not:

Accepted Answer

A)  restrict access to cash. 
B)  document the amount of cash received for items sold. 
C)  summarize the cash register's total cash sales. 
D)  reconcile accrual accounting with cash accounting. 
A)  restrict access to cash. 
B)  document the amount of cash received for items sold. 
C)  summarize the cash register's total cash sales. 
D)  reconcile accrual accounting with cash accounting.

Question 9

Assume a voucher system is in use.When the bill for goods or services is obtained,which control principle(s)must be met when the related control procedures are designed

Accepted Answer

A)  Establish responsibility 
B)  Segregate duties 
C)  Segregate duties and restrict access 
D)  Document procedures and independently verify 
A)  Establish responsibility 
B)  Segregate duties 
C)  Segregate duties and restrict access 
D)  Document procedures and independently verify

Question 10

The following information is available for the Tierney Company for the month of November.
-On November 30,after all transactions have been recorded,the balance in the company's Cash account has a balance of $27,202.
-The company's bank statement shows a balance on November 30 of $29,279.
-Outstanding checks at November 30 include check #3030 in the amount of $1,525 and check #3556 in the amount of $1,459.
-Included with the bank statement was a credit memo in the amount of $770 for an EFT in payment of a customer's account.
-The bank deducted $67 for an NSF check from a customer deposited on November 22.
-A deposit placed in the bank's night depository on November 30 totaled $1,675 and did not appear on the bank statement.
-Examination of the checks on the bank statement with the entries in the accounting records reveals that check #3445 for the payment of an account payable was correctly written for $2,450,but was recorded in the accounting records as $2,540.
-Included with the bank statement was a debit memorandum in the amount of $25 for bank service charges.
Required:
Prepare the journal entries for the items that would appear on the company's bank reconciliation as of November 30.(Do not prepare the bank reconciliation.)

Accepted Answer

The answer of The following information is available for the...

Question 11

The entry to record to establish a petty cash fund is a debit to ______ and a credit to:

Accepted Answer

A)  Petty Expense Cash; Cash 
B)  Petty Cash; Petty Cash Expense 
C)  Petty Cash; Cash 
D)  Petty Cash Expense; Petty Cash 
A)  Petty Expense Cash; Cash 
B)  Petty Cash; Petty Cash Expense 
C)  Petty Cash; Cash 
D)  Petty Cash Expense; Petty Cash

Question 12

If a bank reconciliation included a deposit in transit of $670,the company's journal entry for this reconciling item would include:

Accepted Answer

A)  nothing, because the deposit has already been recorded 
B)  a debit to Cash of $670 
C)  a credit to Cash of $670 
D)  a credit to Accounts Receivable for $670 
A)  nothing, because the deposit has already been recorded 
B)  a debit to Cash of $670 
C)  a credit to Cash of $670 
D)  a credit to Accounts Receivable for $670

Question 13

Research has found that three factors exist when fraud occurs.Identify and describe each of the three factors of the fraud triangle.

Accepted Answer

The following three factors work togethe

Question 14

The petty cash fund was used to reimburse employees for office expenses during the month.The cash and receipts in the locked box equaled the Petty Cash account balance.When the petty cash fund is replenished,the related journal entry will include a debit to:

Accepted Answer

A) Office Expenses. 
B) Petty Cash. 
C) Cash. 
D) Cash Shortage. 
A) Office Expenses. 
B) Petty Cash. 
C) Cash. 
D) Cash Shortage.

Question 15

Flynn Company's monthly bank statement showed the ending balance of cash of $18,500.The bank reconciliation for the period showed an adjustment for a deposit in transit of $1,500, outstanding checks of $2,000, a NSF check of $700, bank service charges of $30 and the EFT from a customer in payment of the customer's account of $1,500.
-Use the information above to answer the following question.What journal entry should be recorded by Flynn Company for the NSF check returned?

Accepted Answer

A)  Debit Accounts Receivable and credit Cash for $700 
B)  Debit Cash and credit Accounts Receivable for $700 
C)  Debit Cash and credit Accounts Payable for $700 
D)  No journal entry is necessary for this item. 
A)  Debit Accounts Receivable and credit Cash for $700 
B)  Debit Cash and credit Accounts Receivable for $700 
C)  Debit Cash and credit Accounts Payable for $700 
D)  No journal entry is necessary for this item.

Question 16

Identify whether a company should debit (Dr)or credit (Cr)its Cash account to record each of the following transactions:
1._____ The company writes a $197.06 check.
2._____ The company deposits a $5,000 check into its account.
3._____ In a bank reconciliation,the company discovers that it recorded a $127.35 payment to a supplier as $27.35.
4._____ The bank pays $16.00 interest on the company's account.
5._____ The company electronically transfers $867 to a supplier.
6._____ A customer check in the amount of $31 is returned by the bank as NSF.
7._____ The bank charges $12 in fees to the company's bank account.
8._____ When preparing the bank reconciliation,the company's accountant discovers a check in the amount of $1,000 that had been written but had not been recorded.
9._____ A customer electronically transfers $189.43 to the company's bank account.

Accepted Answer

1.Cr
2.Dr

Question 17

The cashier uses the cash register and its accompanying point-of-sale accounting system to perform three important functions.Which of the following is not one of those functions?

Accepted Answer

A)  Document total cash sales 
B)  Document amount charged for each item sold 
C)  Segregate duties 
D)  Restrict access 
A)  Document total cash sales 
B)  Document amount charged for each item sold 
C)  Segregate duties 
D)  Restrict access

Question 18

The journal entry to establish a petty cash fund should include a debit to:

Accepted Answer

A)  Cash and a credit to Petty Cash. 
B)  Petty Cash and a credit to Cash. 
C)  Petty Cash and a credit to Accounts Receivable. 
D)  Cash and a credit to Petty Cash Shortage. 
A)  Cash and a credit to Petty Cash. 
B)  Petty Cash and a credit to Cash. 
C)  Petty Cash and a credit to Accounts Receivable. 
D)  Cash and a credit to Petty Cash Shortage.

Question 19

The entry recorded when the petty cash fund is replenished includes a debit to Petty Cash and a credit to Cash.

Accepted Answer

A) True 
 B)False

Question 20

A $250 bank deposit made on the last day of the month did not appear on this month's bank statement.How would this item be treated on the bank reconciliation?

Accepted Answer

A)  It would be deducted from the book balance. 
B)  It would be added to the bank balance. 
C)  It would be deducted from the bank balance. 
D)  It would be added to the book balance. 
A)  It would be deducted from the book balance. 
B)  It would be added to the bank balance. 
C)  It would be deducted from the bank balance. 
D)  It would be added to the book balance.

Which of the following would be deducted from the ending cash balance per bank when performing a bank reconciliation?

The use of sequentially numbered checks is an example of:

Which of the following is deducted from the bank balance on a bank reconciliation?

The purpose of internal controls includes all of the following except:

Which of the following is not a significant objective of the Sarbanes-Oxley (SOX)Act?

Which of the following statements correctly describes an imprest system?

A cash register does not:

Assume a voucher system is in use.When the bill for goods or services is obtained,which control principle(s)must be met when the related control procedures are designed

The entry to record to establish a petty cash fund is a debit to ______ and a credit to:

If a bank reconciliation included a deposit in transit of $670,the company's journal entry for this reconciling item would include:

Research has found that three factors exist when fraud occurs.Identify and describe each of the three factors of the fraud triangle.

The petty cash fund was used to reimburse employees for office expenses during the month.The cash and receipts in the locked box equaled the Petty Cash account balance.When the petty cash fund is replenished,the related journal entry will include a debit to:

The cashier uses the cash register and its accompanying point-of-sale accounting system to perform three important functions.Which of the following is not one of those functions?

The journal entry to establish a petty cash fund should include a debit to:

The entry recorded when the petty cash fund is replenished includes a debit to Petty Cash and a credit to Cash.

A $250 bank deposit made on the last day of the month did not appear on this month's bank statement.How would this item be treated on the bank reconciliation?

Business Decisions and Financial Accounting

Reporting Investing and Financing Results on the Balance Sheet

Reporting Operating Results on the Income Statement

Adjustments,financial Statements,and Financial Results

Internal Control and Financial Reporting for Cash and Merchandising Operations

Reporting and Interpreting Inventories and Cost of Goods Sold

Reporting and Interpreting Receivables,bad Debt Expense,and Interest Revenue

Reporting and Interpreting Long-Lived Tangible and Intangible Assets

Reporting and Interpreting Liabilities

Reporting and Interpreting Stockholders Equity

Reporting and Interpreting the Statement of Cash Flows

Measuring and Evaluating Financial Performance

Filters

Exam 5: Fraud, Internal Control, and Cash

Which of the following would be deducted from the ending cash balance per bank when performing a bank reconciliation?

The use of sequentially numbered checks is an example of:

Which of the following is deducted from the bank balance on a bank reconciliation?

The purpose of internal controls includes all of the following except:

Which of the following is not a significant objective of the Sarbanes-Oxley (SOX)Act?

Which of the following statements correctly describes an imprest system?

A cash register does not:

Assume a voucher system is in use.When the bill for goods or services is obtained,which control principle(s)must be met when the related control procedures are designed

The entry to record to establish a petty cash fund is a debit to ______ and a credit to:

If a bank reconciliation included a deposit in transit of $670,the company's journal entry for this reconciling item would include:

Research has found that three factors exist when fraud occurs.Identify and describe each of the three factors of the fraud triangle.

The petty cash fund was used to reimburse employees for office expenses during the month.The cash and receipts in the locked box equaled the Petty Cash account balance.When the petty cash fund is replenished,the related journal entry will include a debit to:

The cashier uses the cash register and its accompanying point-of-sale accounting system to perform three important functions.Which of the following is not one of those functions?

The journal entry to establish a petty cash fund should include a debit to:

The entry recorded when the petty cash fund is replenished includes a debit to Petty Cash and a credit to Cash.

A $250 bank deposit made on the last day of the month did not appear on this month's bank statement.How would this item be treated on the bank reconciliation?

Business Decisions and Financial Accounting

Reporting Investing and Financing Results on the Balance Sheet

Reporting Operating Results on the Income Statement

Adjustments,financial Statements,and Financial Results

Internal Control and Financial Reporting for Cash and Merchandising Operations

Reporting and Interpreting Inventories and Cost of Goods Sold

Reporting and Interpreting Receivables,bad Debt Expense,and Interest Revenue

Reporting and Interpreting Long-Lived Tangible and Intangible Assets

Reporting and Interpreting Liabilities

Reporting and Interpreting Stockholders Equity

Reporting and Interpreting the Statement of Cash Flows

Measuring and Evaluating Financial Performance

Filters