Question 1

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

Accepted Answer

A)  A debit to Postage Expense. 
B)  A debit to Petty Cash. 
C)  A debit to Cash. 
D)  A debit to Cash Short and Over. 
E)  A debit to Supplies. 
A)  A debit to Postage Expense. 
B)  A debit to Petty Cash. 
C)  A debit to Cash. 
D)  A debit to Cash Short and Over. 
E)  A debit to Supplies.

Question 2

The acid-test ratio differs from the current ratio:

Accepted Answer

A)  Because liabilities are divided by current assets. 
B)  Because prepaid expenses and inventory are excluded. 
C)  Because it measures profitability. 
D)  Because it excludes short-term investments. 
E)  Because prepaid expenses and inventory are excluded and because it measures profitability. 
A)  Because liabilities are divided by current assets. 
B)  Because prepaid expenses and inventory are excluded. 
C)  Because it measures profitability. 
D)  Because it excludes short-term investments. 
E)  Because prepaid expenses and inventory are excluded and because it measures profitability.

Question 3

A credit memorandum from the bank may be used as:

Accepted Answer

A)  An explanation for a payment by cheque. 
B)  A bank statement. 
C)  A voucher. 
D)  An EFT. 
E)  A cancelled cheque. 
A)  An explanation for a payment by cheque. 
B)  A bank statement. 
C)  A voucher. 
D)  An EFT. 
E)  A cancelled cheque.

Question 4

An internal control system is all policies and procedures managers use to _______________,ensure reliable accounting,promote efficient operations,and encourage adherence to company policies.

Accepted Answer

The answer of An internal control system is all policies...

Question 5

The following information pertains to Z-Mart,its competition,and the industry standards.   The industry standard for the current ratio is 1.8 to 1.The industry standard for the acid-test ratio is 1 to 1.
Instructions:
(1)Calculate the current ratio and quick ratio for each firm.
(2)Rank the firms in decreasing order of liquidity.
(3)Comment on Z-Mart's relative position.

Accepted Answer

The answer of The following information pertains to Z-Mart,its competition,and...

Question 6

The entry necessary to establish a petty cash fund should include:

Accepted Answer

A)  A debit to Cash. 
B)  A credit to Cash. 
C)  A debit to Petty Cash. 
D)  A credit to Petty Cash. 
E)  A credit to Cash and a debit to Petty Cash. 
A)  A debit to Cash. 
B)  A credit to Cash. 
C)  A debit to Petty Cash. 
D)  A credit to Petty Cash. 
E)  A credit to Cash and a debit to Petty Cash.

Question 7

A cheque involves three parties: the maker,who signs the cheque,the payee,who is the recipient,and the bank,on which the cheque is drawn.

Accepted Answer

A) True 
 B)False

Question 8

The following information was available for Romney Supply Company for the month ended May 31,2015.

Accepted Answer

The answer of The following information was available for Romney...

Question 9

Internal control procedures:

Accepted Answer

A)  Eliminate the risk of loss. 
B)  Include policies and procedures to safeguard assets. 
C)  Prevent unavoidable losses. 
D)  Both eliminate the risk of loss and include policies and procedures to safeguard assets. 
E)  All of these answers are correct. 
A)  Eliminate the risk of loss. 
B)  Include policies and procedures to safeguard assets. 
C)  Prevent unavoidable losses. 
D)  Both eliminate the risk of loss and include policies and procedures to safeguard assets. 
E)  All of these answers are correct.

Question 10

Identify how each of the following items would be treated on a bank reconciliation by entering one of the following codes in the space provided.

Accepted Answer

The answer of Identify how each of the following items...

Question 11

In reconciling the bank balance,the amount of an unrecorded bank service charge should be:

Accepted Answer

A)  Added to the book balance of cash. 
B)  Deducted from the book balance of cash. 
C)  Added to the bank balance of cash. 
D)  Deducted from the bank balance of cash. 
E)  Noted as a memo. 
A)  Added to the book balance of cash. 
B)  Deducted from the book balance of cash. 
C)  Added to the bank balance of cash. 
D)  Deducted from the bank balance of cash. 
E)  Noted as a memo.

Question 12

Credit card expense may be classified as:

Accepted Answer

A)  A discount deducted from sales to get net sales. 
B)  A selling expense. 
C)  An administrative expense. 
D)  All of these answers are correct. 
E)  A selling expense and an administrative expense. 
A)  A discount deducted from sales to get net sales. 
B)  A selling expense. 
C)  An administrative expense. 
D)  All of these answers are correct. 
E)  A selling expense and an administrative expense.

Question 13

__________________ are short-term,highly liquid investment assets that are readily convertible to a known amount of cash.

Accepted Answer

The answer of __________________ are short-term,highly liquid investment assets that...

Question 14

Outstanding cheques are cheques the bank has paid and deducted from the customer's account during the month.

Accepted Answer

A) True 
 B)False

Question 15

The following information was available for Anderson Company for the month ended May 31,2015.   Prepare a bank reconciliation for Anderson Company at May 31,2015.

Accepted Answer

The answer of The following information was available for Anderson...

Question 16

Limitations of internal control include:

Accepted Answer

A)  Human error. 
B)  Human fraud. 
C)  Cost-benefit standard. 
D)  Human error and fraud. 
E)  All of these answers are correct. 
A)  Human error. 
B)  Human fraud. 
C)  Cost-benefit standard. 
D)  Human error and fraud. 
E)  All of these answers are correct.

Question 17

An internal control system is the policies and procedures that managers use to:

Accepted Answer

A)  Protect assets. 
B)  Ensure reliable accounting. 
C)  Promote efficient operations. 
D)  Encourage adherence to company policies. 
E)  All of these answers are correct. 
A)  Protect assets. 
B)  Ensure reliable accounting. 
C)  Promote efficient operations. 
D)  Encourage adherence to company policies. 
E)  All of these answers are correct.

Question 18

The following information refers to Annie's Attic and competitors in the antiques business.   Information:
Comment on the relative liquidity positions of the companies.

Accepted Answer

Both Chisolm's Collectibles and Bart's B

Question 19

Video Buster had $62 in extra cash at the end of the day.The correct procedure is:

Accepted Answer

A)  Credit Cash for $62. 
B)  Debit Cash for $62. 
C)  Credit Cash Over and Short for $62. 
D)  Debit Cash Over and Short for $62. 
E)  Debit Petty Cash for $62. 
A)  Credit Cash for $62. 
B)  Debit Cash for $62. 
C)  Credit Cash Over and Short for $62. 
D)  Debit Cash Over and Short for $62. 
E)  Debit Petty Cash for $62.

Question 20

When a petty cash fund is in use:

Accepted Answer

A)  Expenses paid with petty cash are recorded when the fund is replenished. 
B)  Petty Cash is debited when funds are replenished. 
C)  Petty Cash is credited when funds are replenished. 
D)  Expenses paid with petty cash are recorded when the fund is replenished and petty cash is debited when funds are replenished. 
E)  Expenses paid with petty cash are recorded when the fund is replenished and petty cash is credited when funds are replenished. 
A)  Expenses paid with petty cash are recorded when the fund is replenished. 
B)  Petty Cash is debited when funds are replenished. 
C)  Petty Cash is credited when funds are replenished. 
D)  Expenses paid with petty cash are recorded when the fund is replenished and petty cash is debited when funds are replenished. 
E)  Expenses paid with petty cash are recorded when the fund is replenished and petty cash is credited when funds are replenished.

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

The acid-test ratio differs from the current ratio:

A credit memorandum from the bank may be used as:

An internal control system is all policies and procedures managers use to _______________,ensure reliable accounting,promote efficient operations,and encourage adherence to company policies.

The entry necessary to establish a petty cash fund should include:

A cheque involves three parties: the maker,who signs the cheque,the payee,who is the recipient,and the bank,on which the cheque is drawn.

The following information was available for Romney Supply Company for the month ended May 31,2015.

Internal control procedures:

Identify how each of the following items would be treated on a bank reconciliation by entering one of the following codes in the space provided.

In reconciling the bank balance,the amount of an unrecorded bank service charge should be:

Credit card expense may be classified as:

__________________ are short-term,highly liquid investment assets that are readily convertible to a known amount of cash.

Outstanding cheques are cheques the bank has paid and deducted from the customer's account during the month.

The following information was available for Anderson Company for the month ended May 31,2015. Prepare a bank reconciliation for Anderson Company at May 31,2015.

Limitations of internal control include:

An internal control system is the policies and procedures that managers use to:

The following information refers to Annie's Attic and competitors in the antiques business. Information: Comment on the relative liquidity positions of the companies.

Video Buster had $62 in extra cash at the end of the day.The correct procedure is:

When a petty cash fund is in use:

Accounting in Business

Analyzing and Reporting Transactions

Adjusting Accounts for Financial Statements

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Merchandise Inventory and Cost of Sales

Accounting Information Systems

Receivables

Filters

Exam 8: Internal Control and Cash

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

The acid-test ratio differs from the current ratio:

A credit memorandum from the bank may be used as:

An internal control system is all policies and procedures managers use to _______________,ensure reliable accounting,promote efficient operations,and encourage adherence to company policies.

The entry necessary to establish a petty cash fund should include:

A cheque involves three parties: the maker,who signs the cheque,the payee,who is the recipient,and the bank,on which the cheque is drawn.

The following information was available for Romney Supply Company for the month ended May 31,2015.

Internal control procedures:

Identify how each of the following items would be treated on a bank reconciliation by entering one of the following codes in the space provided.

In reconciling the bank balance,the amount of an unrecorded bank service charge should be:

Credit card expense may be classified as:

__________________ are short-term,highly liquid investment assets that are readily convertible to a known amount of cash.

Outstanding cheques are cheques the bank has paid and deducted from the customer's account during the month.

The following information was available for Anderson Company for the month ended May 31,2015. Prepare a bank reconciliation for Anderson Company at May 31,2015.

Limitations of internal control include:

An internal control system is the policies and procedures that managers use to:

The following information refers to Annie's Attic and competitors in the antiques business. Information: Comment on the relative liquidity positions of the companies.

Video Buster had $62 in extra cash at the end of the day.The correct procedure is:

When a petty cash fund is in use:

Accounting in Business

Analyzing and Reporting Transactions

Adjusting Accounts for Financial Statements

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Merchandise Inventory and Cost of Sales

Accounting Information Systems

Receivables

Filters