Exam 6: Reporting and Analyzing Cash and Internal Controls

The payee is the person who signs a check and authorizes payment.

A seller of goods or services,which is usually a manufacturer or wholesaler is known as a:

Identify whether each of the following items would on appear on the bank side or the book side of a bank reconciliation.

A ____________ is a report explaining any differences between the checking account balance according to the depositor's records and the balance reported on the bank statement.

The clerk who has access to the cash in the cash register should not have access to the cash register tape or file.

The entry to record reimbursement of the petty cash fund for postage expense should include:

The Petty Cash account is a separate checking account used for small amounts.

Cash equivalents:

A company reported net sales for Year 1 of $285,000 and $575,000 for Year 2.The year-end balances of accounts receivable were $49,000 for Year 1 and $85,000 for Year 2.Calculate the days' sales uncollected at the end of each year for this company and describe any changes in the apparent liquidity of the company's receivables.

It is not necessary for businesses to reconcile their checking accounts since banks keep accurate records and provide internal control support for cash.

An income statement account that is used to record cash overages and cash shortages arising from omitted petty cash receipts and from errors in making change is called the:

Given the following information: Petty cash balance: $530.00 Courier receipt: $ 74.22 Postage receipt: $ 25.00 Office Supplies receipt: $ 95.64 Business Meal receipt: $ 54.21 Cash on hand at the end of the month: $299.71 What is the amount that needs to be recorded for cash over and short?

Fluffy Pet Grooming deposits all cash receipts on the day when they are received and all cash payments are made by check.At the close of business on June 30,its Cash account shows a $14,811,debit balance.Fluffy Pet Grooming's June 30 bank statement shows $14,472 on deposit in the bank.Prepare a bank reconciliation for Fluffy Pet Grooming using the following information a. Outstanding checks as of June 30 total $ 2,261 . b. The June 30 bank statement included a$ 75 debit memorandum for bank services. c. Check No. 919, listed with the canceled checks, was correctly drawn for \$ 789 in payment of a utility bill on June 15. Fluffy Pet Grooming mistakenly recorded it with a debit to Utilities Expense and a credit to Cash in the amount of $ 798 . d. The June 30 cash receipts of $ 2,534 were placed in the bank's night depository after banking hours and were not recorded on the June 30 bank statement What is the adjusted bank balance?

Cash,not including cash equivalents,includes:

Two important limitations of internal control systems are (1)human error or human fraud and (2)cost-benefit.

The impact of technology on internal controls includes which of the following:

Which of the following is the most serious limitation of internal controls?

A set of procedures and approvals that is designed to control cash disbursements and the acceptance of obligations is referred to as a(n):

Having external auditors test the company's financial records and evaluate the effectiveness of the internal control system is part of the internal control principle of ________________________.

What are the checks that must be completed prior to the completion of invoice approval and voucher preparation?