Designs on You The following information relates to the company's May bank reconciliation: $\begin{array}{ll} \text { Bank statement balance } &\$ 5,000 \\ \text { Unadjusted cash balance from the company records } &? \\ \text { Deposit in trensit } &1,000 \\ \text { Outstanding checks } &500 \\ \text { Bank service charges } &50 \\ \text { Interest earned on the bank account } &10 \\ \text { Customen's NSF check returned by the bank } &25 \end{array}$ In addition,a check was recorded in the accounting records as $1,200 but the correct amount as recorded by the bank was only $1,000. -Refer to Designs on You.What is the net amount of the adjustments to the company's cash balance as a result of the bank reconciliation process?

A) $210 increase B) $135 increase C) $135 decrease D) $65 decrease A) $210 increase B) $135 increase C) $135 decrease D) $65 decrease

Delco Construction The following items relate to the company's March bank reconciliation: $\begin{array}{ll} \text { Bank statement balance } &\$ 29,600 \\ \text { Unadjusted cash balance ac cording to company records } &? \\ \text { Deposit in trensit } &2,200 \\ \text { Outstanding checks } &3,100 \\ \text { Bank service charges } &200 \\ \text { Interest earned on the bank account } &100 \\ \text { Customen's NSF check returned by the bank } &300 \end{array}$ -Refer to Delco Construction.What is the company's unadjusted cash balance in its accounting records at March 31st before the reconciliation was completed?

A) $28,700 B) $29,100 C) $28,300 D) $29,600 A) $28,700 B) $29,100 C) $28,300 D) $29,600

Dreammaker Kitchens The following information relates to the company's November bank reconciliation: $\begin{array}{ll} \text { Bank statement balance } &\$ 10,700 \\ \text { Unadjusted cash balance from the companys records } &? \\ \text { Deposit in trensit } &2,100 \\ \text { Outstanding checks } &1,200 \\ \text { Bank service charges } &300 \\ \text { Interest earned on the bank account } &100 \\ \text { Customen's NSF check returned by the bank } &400 \end{array}$ -Refer to Dreammaker Kitchens.What is the company's adjusted cash balance on November 30th?

A) $12,200 B) $11,600 C) $10,700 D) $10,100 A) $12,200 B) $11,600 C) $10,700 D) $10,100

Dance Town Academy The items listed below were identified while preparing a bank reconciliation for the company's checking account as of March 31,2013. $\begin{array}{ll} \text { Cash balance according to the general ledger } & ? \\ \text { Bank statement balance } & \$ 18,500 \\ \text { Outstanding checks } & 2,700 \\ \text { Customer's bounced check } & 350 \\ \text { Bank service charges } & 100 \\ \text { Deposits in transit } & 1,000 \\ \text { Interest earned on the checking account } & 60 \end{array}$ -Refer to Dance Town Academy.How will the deposits in transit be handled on a bank reconciliation?

A) add to the balance from the company records B) subtract from the balance from the company records C) add to the bank statement balance D) subtract from the bank statement balance A) add to the balance from the company records B) subtract from the balance from the company records C) add to the bank statement balance D) subtract from the bank statement balance

On June 30,a company had $1,924 in its cash account according to its general ledger.This included a deposit of $174 that was in transit on June 30th.The June 30th bank statement contained the following information: $\begin{array}{ll} \text {Bank statement balance} &\$ 2,178 \\ \text {Bank service charge} &14 \\ \text {Collection of notesreceivable} &136\\ \text { NSF check } &32 \end{array}$ Assuming outstanding checks of $338,what is the company's adjusted cash balance at June 30th?

A) $1,840 B) $1,880 C) $2,014 D) $2,178 A) $1,840 B) $1,880 C) $2,014 D) $2,178

Dance Town Academy The items listed below were identified while preparing a bank reconciliation for the company's checking account as of March 31,2013. $\begin{array}{ll} \text { Cash balance according to the general ledger } & ? \\ \text { Bank statement balance } & \$ 18,500 \\ \text { Outstanding checks } & 2,700 \\ \text { Customer's bounced check } & 350 \\ \text { Bank service charges } & 100 \\ \text { Deposits in transit } & 1,000 \\ \text { Interest earned on the checking account } & 60 \end{array}$ -Refer to Dance Town Academy.Determine the amount of the company's adjusted cash balance.

A) $16,800 B) $20,200 C) $ 1,700 D) Cannot be determined A) $16,800 B) $20,200 C) $ 1,700 D) Cannot be determined

Delco Construction The following items relate to the company's March bank reconciliation: $\begin{array}{ll} \text { Bank statement balance } &\$ 29,600 \\ \text { Unadjusted cash balance ac cording to company records } &? \\ \text { Deposit in trensit } &2,200 \\ \text { Outstanding checks } &3,100 \\ \text { Bank service charges } &200 \\ \text { Interest earned on the bank account } &100 \\ \text { Customen's NSF check returned by the bank } &300 \end{array}$ -Refer to Delco Construction.What is net amount of the adjustments to the company's cash balance as a result of the bank reconciliation?

A) $400 increase B) $400 decrease C) $900 increase D) No adjustments are needed. A) $400 increase B) $400 decrease C) $900 increase D) No adjustments are needed.

Exam 4: Internal Control and Cash

An internal control activity that separates responsibilities so that no one person handles all the tasks for a particular activity is referred to as ____________________

(Short Answer)

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Question 61

Which one of the following statements is true?

(Multiple Choice)

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Question 62

Designs on You The following information relates to the company's May bank reconciliation: Bank statement balance \ 5,000 Unadjusted cash balance from the company records ? Deposit in trensit 1,000 Outstanding checks 500 Bank service charges 50 Interest earned on the bank account 10 Customen's NSF check returned by the bank 25 In addition,a check was recorded in the accounting records as $1,200 but the correct amount as recorded by the bank was only $1,000. -Refer to Designs on You.What is the net amount of the adjustments to the company's cash balance as a result of the bank reconciliation process?

(Multiple Choice)

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Question 63

Delco Construction The following items relate to the company's March bank reconciliation: Bank statement balance \ 29,600 Unadjusted cash balance ac cording to company records ? Deposit in trensit 2,200 Outstanding checks 3,100 Bank service charges 200 Interest earned on the bank account 100 Customen's NSF check returned by the bank 300 -Refer to Delco Construction.What is the company's unadjusted cash balance in its accounting records at March 31st before the reconciliation was completed?

(Multiple Choice)

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Question 64

On a bank reconciliation,interest earned for the month is added to the cash balance per the company records.

(True/False)

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Question 65

Each of the following documents is used in the control of cash receipts except:

(Multiple Choice)

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Question 66

Dreammaker Kitchens The following information relates to the company's November bank reconciliation: Bank statement balance \ 10,700 Unadjusted cash balance from the companys records ? Deposit in trensit 2,100 Outstanding checks 1,200 Bank service charges 300 Interest earned on the bank account 100 Customen's NSF check returned by the bank 400 -Refer to Dreammaker Kitchens.What is the company's adjusted cash balance on November 30th?

(Multiple Choice)

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Question 67

Collections of accounts receivable are considered to be cash equivalents.

(True/False)

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Question 68

When reconciling a bank account,the company has to prepare an adjusting entry for outstanding checks.

(True/False)

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Question 69

Strategic risk assessment is designed to identify,analyze,and manage possible threats to the organization's success concerning ____________________ forces such as competitors,customers,suppliers,and PEST factors.

(Short Answer)

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Question 70

Dance Town Academy The items listed below were identified while preparing a bank reconciliation for the company's checking account as of March 31,2013. Cash balance according to the general ledger ? Bank statement balance \ 18,500 Outstanding checks 2,700 Customer's bounced check 350 Bank service charges 100 Deposits in transit 1,000 Interest earned on the checking account 60 -Refer to Dance Town Academy.How will the deposits in transit be handled on a bank reconciliation?

(Multiple Choice)

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Question 71

The foundation of the internal control system is the control _____________ - the collection of environmental factors that influence the effectiveness of control procedures.

(Short Answer)

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Question 72

Which of the following is the correct entry to establish a petty cash fund in the amount of $300?

(Multiple Choice)

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Question 73

Which of the following is not a sound internal control procedure for cash disbursements?

(Multiple Choice)

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Question 74

Petty Cash is NOT considered to be a cash equivalent.

(True/False)

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Question 75

Having one employee prepare company checks and sign those checks relates to which internal control activity?

(Multiple Choice)

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Question 76

The accounting records for Delta Driving School shows a cash balance of $14,134 on February 28,2012.On the evening of February 28,company receipts of $1,250 were placed in the bank's night deposit drop box;this deposit was processed by the bank on March 1.The February 28 bank statement shows balance of $18,877,including collection of a $6,000 note receivable plus $55 of interest earned,a service charge of $40,and a $1,550 debit memo for the payment of the company's utility bill.All of the checks that the company had written during January were listed on the bank statement except for check #1908 in the amount of $1,528. A)Prepare a bank reconciliation to calculate the company's adjusted cash balance at February 28,2012. B)Prepare the journal entries needed to adjust the cash records as a result of the bank reconciliation procedures.

(Essay)

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Question 77

On June 30,a company had $1,924 in its cash account according to its general ledger.This included a deposit of $174 that was in transit on June 30th.The June 30th bank statement contained the following information: Bank statement balance \ 2,178 Bank service charge 14 Collection of notesreceivable 136 NSF check 32 Assuming outstanding checks of $338,what is the company's adjusted cash balance at June 30th?

(Multiple Choice)

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Question 78

Dance Town Academy The items listed below were identified while preparing a bank reconciliation for the company's checking account as of March 31,2013. Cash balance according to the general ledger ? Bank statement balance \ 18,500 Outstanding checks 2,700 Customer's bounced check 350 Bank service charges 100 Deposits in transit 1,000 Interest earned on the checking account 60 -Refer to Dance Town Academy.Determine the amount of the company's adjusted cash balance.

(Multiple Choice)

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Question 79

Delco Construction The following items relate to the company's March bank reconciliation: Bank statement balance \ 29,600 Unadjusted cash balance ac cording to company records ? Deposit in trensit 2,200 Outstanding checks 3,100 Bank service charges 200 Interest earned on the bank account 100 Customen's NSF check returned by the bank 300 -Refer to Delco Construction.What is net amount of the adjustments to the company's cash balance as a result of the bank reconciliation?

(Multiple Choice)

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Question 80

An internal control activity that separates responsibilities so that no one person handles all the tasks for a particular activity is referred to as ____________________

Which one of the following statements is true?

On a bank reconciliation,interest earned for the month is added to the cash balance per the company records.

Each of the following documents is used in the control of cash receipts except:

Collections of accounts receivable are considered to be cash equivalents.

When reconciling a bank account,the company has to prepare an adjusting entry for outstanding checks.

Strategic risk assessment is designed to identify,analyze,and manage possible threats to the organization's success concerning ____________________ forces such as competitors,customers,suppliers,and PEST factors.

The foundation of the internal control system is the control _____________ - the collection of environmental factors that influence the effectiveness of control procedures.

Which of the following is the correct entry to establish a petty cash fund in the amount of $300?

Which of the following is not a sound internal control procedure for cash disbursements?

Petty Cash is NOT considered to be a cash equivalent.

Having one employee prepare company checks and sign those checks relates to which internal control activity?

Accounting and the Financial Statements

The Accounting Information System

Accrual Accounting

Sales and Receivables

Cost of Goods Sold and Inventory

Operating Assets

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

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