Question 1

Debit cards are being used:

Accepted Answer

A)  in place of petty cash funds.
B)  for small purchases.
C)  for package delivery fees.
D)  all of the above.E) A) and B)
F) A) and C)

Question 2

Fraudulent financial reporting is the only type of fraud that involves making false or misleading entries in the books of the company.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is a CORRECT statement regarding the bank reconciliation?

Accepted Answer

A)  The bank reconciliation is part of the general ledger.
B)  Journal entries need to be made for all transactions on the bank side to get the accounts up-to-date.
C)  Journal entries need to be made for all transactions on the book side to get the accounts up-to-date.
D)  The bank reconciliation is part of the journal.E) A) and B)
F) All of the above

Question 4

With regard to customer checks received by mail, which statement is TRUE?

Accepted Answer

A)  The debit to Cash by the accounting department should equal the amount deposited in the bank by the mailroom employee.
B)  The customers' Accounts Receivable accounts should be adjusted by the cashier in the treasury department for the payments received.
C)  The controller compares the customers' checks to the remittance advices sent from the mailroom.
D)  The accounting department debits Cash and credits Accounts Receivable. The cashier in the treasurer's department deposits the checks in the bank.E) A) and B)
F) None of the above

Question 5

Zeman Company prepares a cash budget. The budgeted cash balance is $8,000,000. The company has budgeted cash payments of $5,400,000 and budgeted cash receipts of $10,300,000. The beginning balance of cash is $0. What amount of new financing is required?

Accepted Answer

A)  No new financing is required.
B)  $4,900,000
C)  $2,600,000
D)  $3,100,000E) A) and B)
F) None of the above

Question 6

E-commerce pitfalls include all of the following EXCEPT:

Accepted Answer

A)  stolen credit card numbers.
B)  phishing expedition.
C)  encryption.
D)  trojan horses.E) A) and B)
F) A) and C)

Question 7

What is fraud?

Accepted Answer

A)  Fraud is the intentional misrepresentation of facts made for the purpose of persuading another individual to act in a way that causes injury or damage to that individual.
B)  Fraud is the misappropriation of assets.
C)  Fraud is untruthful financial reporting.
D)  all of the aboveE) A) and C)
F) B) and C)

Question 8

The beginning cash balance is $3000, estimated cash receipts are $108,000, and estimated cash payments are $107,000. How much cash must be borrowed to have a desired ending balance of $9000?

Accepted Answer

A)  $13,000
B)  $3000
C)  $9000
D)  $5000E) B) and C)
F) A) and D)

Question 9

The objectives of internal control do NOT include:

Accepted Answer

A)  safeguard assets.
B)  encourage employees to follow company policy.
C)  ensure accurate, reliable accounting records.
D)  strong control environment.E) All of the above
F) C) and D)

Question 10

Smart hiring practices include:

Accepted Answer

A)  background checks.
B)  clear job descriptions.
C)  proper training and supervision.
D)  all of the above.E) A) and C)
F) B) and C)

Question 11

In the cash budget, examples of cash payments do NOT include:

Accepted Answer

A)  purchase of inventory with cash.
B)  payment of operating expenses.
C)  payment of dividend.
D)  depreciation expense.E) A) and D)
F) B) and C)

Question 12

A payment packet of documents:

Accepted Answer

A)  reports the arrival of items purchased.
B)  is sent by the purchasing department to the vendor selling the item.
C)  identifies the need for merchandise and begins the purchasing process.
D)  includes the invoice, receiving report and purchase order.E) A) and C)
F) All of the above

Question 13

The three main components of the fraud triangle are:

Accepted Answer

A)  rationalization, opportunity and greed.
B)  opportunity, motive and lack of ethics.
C)  motive, opportunity and rationalization.
D)  none of the above.E) B) and C)
F) All of the above

Question 14

The ending bank statement balance at November 30 is $7550. The bank statement shows a service charge of $75, electronic funds receipts of $500, and a NSF check for $350. Deposits in transit total $2550 and outstanding checks are $1735. The balance per books at November 30 is $8290. What is the adjusted bank balance at November 30?

Accepted Answer

A)  $7550
B)  $7625
C)  $8365
D)  $9105E) None of the above
F) A) and B)

Question 15

Which journal entry is prepared for a NSF check returned by the bank?

Accepted Answer

A)  No entry is prepared.
B)  Debit Cash and credit Accounts Payable.
C)  Debit Cash and credit Notes Payable.
D)  Debit Accounts Receivable and credit Cash.E) All of the above
F) C) and D)

Question 16

Differences between the bank statement and the company's Cash account are primarily the result of a time lag in recording transactions.

Accepted Answer

A) True 
 B)False

Question 17

To prevent unauthorized access to cash, as well as to allow for more efficient management of cash, many chain retail businesses use "depository bank accounts."

Accepted Answer

A) True 
 B)False

Question 18

An imprest petty cash fund of $900 was established for minor disbursements. At the end of the month the fund included petty cash tickets for the purchase of $181 in supplies, $45 for postage, $76 for fuel and a delivery charge of $73. How much cash should left in the fund?

Accepted Answer

A)  $525
B)  $598
C)  $674
D)  $719E) B) and C)
F) A) and D)

Question 19

Outstanding checks are checks that have been paid by the bank, but are not yet recorded on the company's books.

Accepted Answer

A) True 
 B)False

Question 20

The bank reconciliation can be used to control cash in a bank account.

Accepted Answer

A) True 
 B)False

Exam 4: Internal Control Cash

Zeman Company prepares a cash budget. The budgeted cash balance is $8,000,000. The company has budgeted cash payments of $5,400,000 and budgeted cash receipts of $10,300,000. The beginning balance of cash is $0. What amount of new financing is required?

Correct Answer
verified

Which journal entry is prepared for a NSF check returned by the bank?

Correct Answer
verified

To prevent unauthorized access to cash, as well as to allow for more efficient management of cash, many chain retail businesses use "depository bank accounts."

Correct Answer
verified

In the cash budget, examples of cash payments do NOT include:

Correct Answer
verified

Debit cards are being used:

Correct Answer
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Which of the following is a CORRECT statement regarding the bank reconciliation?

Correct Answer
verified

The beginning cash balance is $3000, estimated cash receipts are $108,000, and estimated cash payments are $107,000. How much cash must be borrowed to have a desired ending balance of $9000?

Correct Answer
verified

E-commerce pitfalls include all of the following EXCEPT:

Correct Answer
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Smart hiring practices include:

Correct Answer
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The objectives of internal control do NOT include:

Correct Answer
verified

Fraudulent financial reporting is the only type of fraud that involves making false or misleading entries in the books of the company.

Correct Answer
verified

What is fraud?

Correct Answer
verified

The bank reconciliation can be used to control cash in a bank account.

Correct Answer
verified

An imprest petty cash fund of $900 was established for minor disbursements. At the end of the month the fund included petty cash tickets for the purchase of $181 in supplies, $45 for postage, $76 for fuel and a delivery charge of $73. How much cash should left in the fund?

Correct Answer
verified

A payment packet of documents:

Correct Answer
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With regard to customer checks received by mail, which statement is TRUE?

Correct Answer
verified

The three main components of the fraud triangle are:

Correct Answer
verified

Correct Answer
verified

Outstanding checks are checks that have been paid by the bank, but are not yet recorded on the company's books.

Correct Answer
verified

Differences between the bank statement and the company's Cash account are primarily the result of a time lag in recording transactions.

Correct Answer
verified

Exam 4: Internal Control Cash

Zeman Company prepares a cash budget. The budgeted cash balance is $8,000,000. The company has budgeted cash payments of $5,400,000 and budgeted cash receipts of $10,300,000. The beginning balance of cash is $0. What amount of new financing is required?

Correct AnswerverifiedShow Answer

Which journal entry is prepared for a NSF check returned by the bank?

Correct AnswerverifiedShow Answer

To prevent unauthorized access to cash, as well as to allow for more efficient management of cash, many chain retail businesses use "depository bank accounts."

Correct AnswerverifiedShow Answer

In the cash budget, examples of cash payments do NOT include:

Correct AnswerverifiedShow Answer

Debit cards are being used:

Correct AnswerverifiedShow Answer

Which of the following is a CORRECT statement regarding the bank reconciliation?

Correct AnswerverifiedShow Answer

The beginning cash balance is $3000, estimated cash receipts are $108,000, and estimated cash payments are $107,000. How much cash must be borrowed to have a desired ending balance of $9000?

Correct AnswerverifiedShow Answer

E-commerce pitfalls include all of the following EXCEPT:

Correct AnswerverifiedShow Answer

Smart hiring practices include:

Correct AnswerverifiedShow Answer

The objectives of internal control do NOT include:

Correct AnswerverifiedShow Answer

Fraudulent financial reporting is the only type of fraud that involves making false or misleading entries in the books of the company.

Correct AnswerverifiedShow Answer

What is fraud?

Correct AnswerverifiedShow Answer

The bank reconciliation can be used to control cash in a bank account.

Correct AnswerverifiedShow Answer

An imprest petty cash fund of $900 was established for minor disbursements. At the end of the month the fund included petty cash tickets for the purchase of $181 in supplies, $45 for postage, $76 for fuel and a delivery charge of $73. How much cash should left in the fund?

Correct AnswerverifiedShow Answer

A payment packet of documents:

Correct AnswerverifiedShow Answer

With regard to customer checks received by mail, which statement is TRUE?

Correct AnswerverifiedShow Answer

The three main components of the fraud triangle are:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Outstanding checks are checks that have been paid by the bank, but are not yet recorded on the company's books.

Correct AnswerverifiedShow Answer

Differences between the bank statement and the company's Cash account are primarily the result of a time lag in recording transactions.

Correct AnswerverifiedShow Answer

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