Exam 7: Internal Control and Cash

The following information is available for Juno Company for the month ending June 30, 2019. • Balance as per the bank statement is $12,000. • Balance as per books is $10,400. • Check #506 for $1,400 and check #510 for $800 were not shown on the June 30, bank statement. • A deposit in transit of $2,541 had not been received by the bank when the bank statement $\text { was generated. }$ • A bank debit memo indicated an NSF check for $90 written by Jane Smith to Juno Company $\text { on June } 13$ • A bank credit memo indicated a note collected by the bank of $2,000 and interest revenue $\text { of } \$ 51 \text { on June } 20$ • The bank statement indicated service charges of $20. What is the adjusted book balance?

When a lock-box system is used, customers send their checks to a post office box that belongs to a bank.

Which one of the following is true of the bank reconciliation?

Which of the following statements describes an invoice from a supplier?

A check of $300,000, deposited by a company, was returned to the bank for nonsufficient funds. How would this information be included on the bank reconciliation?

Concerning how companies control cash received by mail, state which employee should perform the following duties: Duty Employee who should perform the duty Open the mail and send customer checks to the treasurer Compare the bank deposits to the journal entry for cash receipts

The bookkeeper of Wilson Electric Supply, Inc. recorded a $1,500 check as $15,000 in payment of the current month's rent. Which of the following journal entries is needed to adjust for this error in the books of the company?

If the bank reconciliation includes a deposit in transit, a journal entry is required that includes a debit to Cash.

For the following situation, state whether it represents a strength or weakness in internal control and give the reason for your answer. - The bookkeeper opens the mail, makes the deposit, and makes the journal entries to record receipt of the cash and checks.

On a bank reconciliation, deposits in transit are added on the bank side of the reconciliation.

The petty cash fund at Brookshire Company has a designated balance of $350. The fund currently holds $126 in cash and $226 in petty cash tickets. Based on this information, which of the following statements is correct?

Match each term with its description. -Invoice

A receiving report should be matched with the supplier invoice before a payment to the supplier is approved.

Which of the following statements describes a receiving report?

Internal control is an organizational plan that ensures that the financial statements are prepared and submitted on time.

The bank's routing number ________.

Define internal control.

Which of the following is an attribute of the internal control procedure-assignment of responsibilities?

When replenishing the petty cash fund, the company debits the Petty Cash account and credits the Cash account.

Companies process credit and debit card transactions internally.