Exam 7: Internal Control and Cash

The following information is available for Andersen Company for the month ending June 30, 2014. • Balance per the bank statement is $10,241.43. • Balance per books is $9,745.06. • Check #506 for $1,948.52 and check #510 for $1,800.25 were not shown on the June 30 bank statement. • A deposit in transit of $5,113.40 had not been received by the bank when the bank statement was generated. • A bank debit memo indicated an NSF check in the amount of $79 written by Bruce Garrett to Andersen Company on June 13. • A bank credit memo indicated a note collected by the bank of $1,900 and interest revenue of $75 on June 20. • The bank statement indicated service charges of $35. What is the adjusted book balance?

An accountant is under pressure to maximize the company's net income at year-end. He is told to delay orders of important services until the following year. This action would be considered unethical because it is a misrepresentation of actual transactions.

Which of the following items are both reconciling items on the bank side of the reconciliation?

The bank charged a service fee of $20. How would this information be included on the bank reconciliation?

The cash balance in a company's general ledger and the bank's balance on the bank statement will generally be different because of the time lag in recording transactions.

Mandatory vacations and job rotation improve internal control.

Reducing expense to increase operating profit is representative of:

Which of the following is TRUE about a bank reconciliation?

A malicious program that enters program code or destroys data without authorization is an example of:

A petty cash fund was established with a $400 balance. It currently has cash of $15 and petty cash tickets as shown below. The journal entry to replenish the account would be which of the following:

Separation of duties limits fraud and promotes the accuracy of the account records.

If the bank reconciliation includes outstanding checks, no journal entries are required.

A fund for petty cash of $200 has $17 remaining in cash, $3 in miscellaneous cash receipts and additional $180 specific cash receipts. The debit to Cash short & over would be:

A company check for payment must be signed by:

Which of the following is a security procedure designed for e-commerce which rearranges text messages by a mathematical process?

If the bank reconciliation includes interest revenue, a journal entry is required which debits Cash and credits Interest revenue.

Which of the following items will NOT appear on the book side of the reconciliation?

Which of the following describes collusion?

Which of the following would be included in the entry to record the replenishment of a petty cash fund?

In the following situation, which internal control procedure needs strengthening? At Hofstra Services, the junior accountant collects checks and cash from customers and records the transactions into the Journal. The controller approves the journal entries and bank reconciliations. The treasurer signs checks and approves contracts.