Question 1

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

Accepted Answer

A) cash account in the general ledger and the petty cash box. 
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) bank statement and the cash in petty cash. 
A) cash account in the general ledger and the petty cash box. 
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) bank statement and the cash in petty cash.

Question 2

A bank deposit of $450 recorded by the bank as $500 should appear on a bank reconciliation as a(n):

Accepted Answer

A) deduction from the book balance of $50. 
B) addition to the book balance of $50. 
C) deduction from the bank balance of $50. 
D) addition to the bank balance of $50. 
A) deduction from the book balance of $50. 
B) addition to the book balance of $50. 
C) deduction from the bank balance of $50. 
D) addition to the bank balance of $50.

Question 3

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

Question 4

If a bank statement includes an EFT payment of $945 for insurance, the journal entry to record this reconciling item should include a:

Accepted Answer

A) debit to Cash for $945. 
B) debit to Accounts Payable for $945. 
C) credit to Cash for $945. 
D) credit to Prepaid Insurance for $945. 
A) debit to Cash for $945. 
B) debit to Accounts Payable for $945. 
C) credit to Cash for $945. 
D) credit to Prepaid Insurance for $945.

Question 5

An intentional misrepresentation of facts, made for the purpose of persuading another party to act in a way that causes injury or damage to that party is:

Accepted Answer

A) collusion. 
B) fraud. 
C) phishing. 
D) lapping. 
A) collusion. 
B) fraud. 
C) phishing. 
D) lapping.

Question 6

A receiving report is prepared by what department?

Accepted Answer

A) Accounting 
B) Shipping (Receiving) 
C) Purchasing 
D) Marketing 
A) Accounting 
B) Shipping (Receiving) 
C) Purchasing 
D) Marketing

Question 7

A key factor in the control environment of many companies is a corporate code of ethics.

Accepted Answer

A) True 
 B)False

Question 8

The journal entry for a note collected by the bank with interest requires a credit to Cash and a debit to both Notes Receivable and Interest Revenue.

Accepted Answer

A) True 
 B)False

Question 9

Investments that are considered so similar to cash that they are combined with cash for financial disclosure purposes on the balance sheet are:

Accepted Answer

A) cash equivalents. 
B) cash equals. 
C) investments. 
D) accounts receivable. 
A) cash equivalents. 
B) cash equals. 
C) investments. 
D) accounts receivable.

Question 10

When cash is received by mail:

Accepted Answer

A) the mailroom sends all customer checks to the treasurer, who has the cashier deposit the money in the bank. 
B) the journal entries are made by the controller. 
C) the mailroom compares the deposit to the journal entry made. 
D) all of the above occur. 
A) the mailroom sends all customer checks to the treasurer, who has the cashier deposit the money in the bank. 
B) the journal entries are made by the controller. 
C) the mailroom compares the deposit to the journal entry made. 
D) all of the above occur.

Question 11

The sum of the cash in the petty cash fund and the total of the paid vouchers should equal the opening balance in the petty cash account at all times.

Accepted Answer

A) True 
 B)False

Question 12

The "tone at the top":

Accepted Answer

A) is a component of control procedures. 
B) starts with the owners and top managers. 
C) means that owners and top managers must behave honorably to set a good example for employees. 
D) is both B and C 
A) is a component of control procedures. 
B) starts with the owners and top managers. 
C) means that owners and top managers must behave honorably to set a good example for employees. 
D) is both B and C

Question 13

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

Accepted Answer

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

Question 14

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) $ 4,000. 
C) $10,000. 
D) unknown. 
A) $ 2,000. 
B) $ 4,000. 
C) $10,000. 
D) unknown.

Question 15

Which of the following indicates the order by which documents are prepared in the purchasing process?

Accepted Answer

A) Purchase order, payment packet, invoice 
B) Invoice, receiving report, purchase order 
C) Purchase order, receiving report, invoice, payment packet 
D) Purchase order, receiving report, payment packet 
A) Purchase order, payment packet, invoice 
B) Invoice, receiving report, purchase order 
C) Purchase order, receiving report, invoice, payment packet 
D) Purchase order, receiving report, payment packet

Question 16

Internal controls are designed to accomplish five objectives-comply with legal requirements, promote operational efficiency, safeguard assets, encourage employees to follow company policy and:

Accepted Answer

A) prevent embezzlement. 
B) prevent collusion. 
C) ensure accurate, reliable external audits. 
D) ensure accurate, reliable accounting records. 
A) prevent embezzlement. 
B) prevent collusion. 
C) ensure accurate, reliable external audits. 
D) ensure accurate, reliable accounting records.

Question 17

Internal controls are so critical to a company that Congress passed the:

Accepted Answer

A) Sarbanes-Oxley Act of 2002. 
B) Kemp-Oxley Act of 2002. 
C) Economic Stimulus Law of 2008. 
D) Public Company Accounting Oversight Board Act of 2002. 
A) Sarbanes-Oxley Act of 2002. 
B) Kemp-Oxley Act of 2002. 
C) Economic Stimulus Law of 2008. 
D) Public Company Accounting Oversight Board Act of 2002.

Question 18

Cash equivalents include accounts receivable expected to be collected within 90 days or less.

Accepted Answer

A) True 
 B)False

Question 19

Interest paid by the bank to a company's account should appear on the bank reconciliation as:

Accepted Answer

A) added to the bank balance. 
B) added to the book balance. 
C) deducted from the book balance. 
D) having no impact on the book balance. 
A) added to the bank balance. 
B) added to the book balance. 
C) deducted from the book balance. 
D) having no impact on the book balance.

Question 20

In a lock-box system, customers send payments into a special post office box.

Accepted Answer

A) True 
 B)False

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

A bank deposit of $450 recorded by the bank as $500 should appear on a bank reconciliation as a(n):

If a bank statement includes an EFT payment of $945 for insurance, the journal entry to record this reconciling item should include a:

An intentional misrepresentation of facts, made for the purpose of persuading another party to act in a way that causes injury or damage to that party is:

A receiving report is prepared by what department?

A key factor in the control environment of many companies is a corporate code of ethics.

The journal entry for a note collected by the bank with interest requires a credit to Cash and a debit to both Notes Receivable and Interest Revenue.

Investments that are considered so similar to cash that they are combined with cash for financial disclosure purposes on the balance sheet are:

When cash is received by mail:

The sum of the cash in the petty cash fund and the total of the paid vouchers should equal the opening balance in the petty cash account at all times.

The "tone at the top":

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

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:

Which of the following indicates the order by which documents are prepared in the purchasing process?

Internal controls are designed to accomplish five objectives-comply with legal requirements, promote operational efficiency, safeguard assets, encourage employees to follow company policy and:

Internal controls are so critical to a company that Congress passed the:

Cash equivalents include accounts receivable expected to be collected within 90 days or less.

Interest paid by the bank to a company's account should appear on the bank reconciliation as:

In a lock-box system, customers send payments into a special post office box.

The Financial Statements

Transaction Analysis

Accrual Accounting Income

Short-Term Investments Receivables

Inventory and Cost of Goods Sold

Plant Assets Intangibles

Liabilities

Stockholders Equity

Long-Term Investments International Operations

The Income Statement the Statement of Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 4: Internal Control Cash

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

A bank deposit of $450 recorded by the bank as $500 should appear on a bank reconciliation as a(n):

If a bank statement includes an EFT payment of $945 for insurance, the journal entry to record this reconciling item should include a:

An intentional misrepresentation of facts, made for the purpose of persuading another party to act in a way that causes injury or damage to that party is:

A receiving report is prepared by what department?

A key factor in the control environment of many companies is a corporate code of ethics.

The journal entry for a note collected by the bank with interest requires a credit to Cash and a debit to both Notes Receivable and Interest Revenue.

Investments that are considered so similar to cash that they are combined with cash for financial disclosure purposes on the balance sheet are:

When cash is received by mail:

The sum of the cash in the petty cash fund and the total of the paid vouchers should equal the opening balance in the petty cash account at all times.

The "tone at the top":

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

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:

Which of the following indicates the order by which documents are prepared in the purchasing process?

Internal controls are designed to accomplish five objectives-comply with legal requirements, promote operational efficiency, safeguard assets, encourage employees to follow company policy and:

Internal controls are so critical to a company that Congress passed the:

Cash equivalents include accounts receivable expected to be collected within 90 days or less.

Interest paid by the bank to a company's account should appear on the bank reconciliation as:

In a lock-box system, customers send payments into a special post office box.

The Financial Statements

Transaction Analysis

Accrual Accounting Income

Short-Term Investments Receivables

Inventory and Cost of Goods Sold

Plant Assets Intangibles

Liabilities

Stockholders Equity

Long-Term Investments International Operations

The Income Statement the Statement of Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Filters