Exam 7: Internal Control and Cash

Which of the following describes the internal control component monitoring of controls?

Which of the following items found on a bank reconciliation does NOT require an adjusting entry?

Journal entries that are necessitated by reconciling items on the book side of the reconciliation all include either a debit to Cash or a credit to Cash.

A check was written by a business for $329, but was recorded erroneously in the cash ledger as $239. How would this error be included on the bank reconciliation?

A petty cash fund was established with a $300 balance. It currently has cash of $78 and petty cash tickets totaling $222 for travel expense. Please provide the journal entry to record the replenishment of the account.

Risk assessment is the "tone at the top" of a business, starting with the owner and the top managers.

Please refer to the following bank reconciliation: Please prepare the adjusting entry for the third reconciling item (NSF check.)

The journal entry to open a new petty cash fund includes a debit to the petty cash account and a credit to cash in bank.

Under the Sarbanes-Oxley Act, violators may be sentenced to prison for securities fraud.

Which of the following statements about internal control is FALSE?

If the bank reconciliation includes a book error, no journal entries are required.

Which of the following describes the internal control component risk assessment?

A check of $75 deposited by a company was returned to the bank for nonsufficient funds. How would this information be included on the bank reconciliation?

In the following situation, which internal control procedure needs strengthening? At Hofstra Services, the accounting clerk fills out unnumbered purchase order forms for purchases of supplies. An operations engineer completes the form with a detailed description of the supplies being ordered, and the operations manager approves the purchase and passes the purchase order back to the accountant for processing.

A document authorizing a cash payment is a(n):

Which of the following statements describes a purchase order?

A company makes a legitimate, properly authorized payment to a supplier. The accountant changes the date of the transaction to shift it to a later time period. Because the transaction is legitimate, this action would not be considered unethical.

The bank statement reveals an EFT received from a customer that has not yet been recorded in the ledger. How would this information be included on the bank reconciliation?

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

Internal auditors evaluate company controls to ensure the accuracy of financial statements.