Question 1

Discuss what would be included under personnel policies.

Accepted Answer

Personnel policies would inclu...

Question 2

Receipts from cash sales of $7,500 were recorded incorrectly by the depositor as $5,700.What adjustment is required in the bank's accounts?

Accepted Answer

A)  Decrease Sales;decrease Cash
B)  Increase Cash;decrease Accounts Receivable
C)  Increase Cash;increase Sales
D)  No adjustment is needed.E) All of the above
F) C) and D) D

Question 3

Employee fraud is the intentional act of deceiving an employer for personal gain.

Accepted Answer

A) True 
 B)False

Question 4

The business's organizational structure influences which of the following elements of
Internal control?

Accepted Answer

A)  Control procedures
B)  Risk assessment
C)  The control environment
D)  Information and communicationE) A) and B)
F) All of the above C

Question 5

A minimum cash balance required by a bank is called

Accepted Answer

A)  cash in bank.
B)  cash equivalent.
C)  compensating balance.
D)  EFT.E) A) and B)
F) A) and C)

Question 6

Why would a bank require a company to maintain a compensating balance?

Accepted Answer

Usually it is part o...

Question 7

There are two internal control objectives: to ensure accurate financial reports,and to ensure compliance with applicable laws.

Accepted Answer

A) True 
 B)False

Question 8

Accompanying the bank statement was a debit memorandum for an NSF check received from a customer.This item would require an adjusting entry including a

Accepted Answer

A)  debit to Accounts Receivable.
B)  debit to Cash.
C)  debit to Accounts Payable.
D)  credit to Accouts Payable.E) A) and C)
F) B) and C) A

Question 9

An element of internal control is

Accepted Answer

A)  risk assessment.
B)  journals.
C)  subsidiary ledgers.
D)  controlling accounts.E) A) and B)
F) A) and C)

Question 10

The bank reconciles its statement to the depositor's records.

Accepted Answer

A) True 
 B)False

Question 11

Using the following information,prepare a bank reconciliation for Salem Co.for
May 31,2010.

Accepted Answer

The answer of Using the following information,prepare a bank reconciliation...

Question 12

Adding a review of operations by an internal audit staff strengthens internal control.

Accepted Answer

A) True 
 B)False

Question 13

The bank reconciliation

Accepted Answer

A)  should be prepared by an employee who records cash transactions.
B)  is part of the internal control system.
C)  is for information purposes only.
D)  is sent to the bank for verification.E) A) and D)
F) None of the above

Question 14

Accompanying the bank statement was a credit memorandum for a short-term note collected by the bank for the depositor.This item is a(n)

Accepted Answer

A)  deduction from the balance per depositor's records.
B)  addition to the balance per bank statement.
C)  deduction from the balance per bank statement.
D)  addition to the balance per depositor's records.E) None of the above
F) B) and C)

Question 15

When a firm uses internal auditors,it is adhering to which of the following internal control elements?

Accepted Answer

A)  Risk assessment
B)  Proofs and security measures
C)  Monitoring
D)  Separating responsibilities for related operationsE) C) and D)
F) All of the above

Question 16

The depositor reconciles the bank's statement to the depositor's records.

Accepted Answer

A) True 
 B)False

Question 17

Separating the responsibilities for purchasing,receiving,and paying for equipment is an example of the control procedure: separating operations,custody of assets,and accounting.

Accepted Answer

A) True 
 B)False

Question 18

In a voucher system,paid vouchers are transferred to a paid voucher file.

Accepted Answer

A) True 
 B)False

Question 19

Requiring employees to take annual vacations is part of which element of internal control?

Accepted Answer

A)  The control environment
B)  Risk assessment
C)  Control procedures
D)  MonitoringE) A) and D)
F) A) and C)

Question 20

In preparing a bank reconciliation,the amount indicated by a debit memorandum for bank service charges is added to the balance per depositor's records.

Accepted Answer

A) True 
 B)False

Exam 5: Sarbanes-Oxley,internal Control,and Cash

Discuss what would be included under personnel policies.

Correct AnswerverifiedPersonnel policies would inclu...View AnswerShow Answer

Receipts from cash sales of $7,500 were recorded incorrectly by the depositor as $5,700.What adjustment is required in the bank's accounts?

Correct AnswerverifiedD

Employee fraud is the intentional act of deceiving an employer for personal gain.

Correct AnswerverifiedShow Answer

The business's organizational structure influences which of the following elements of Internal control?

Correct AnswerverifiedC

A minimum cash balance required by a bank is called

Correct AnswerverifiedShow Answer

Why would a bank require a company to maintain a compensating balance?

Correct AnswerverifiedUsually it is part o...View AnswerShow Answer

There are two internal control objectives: to ensure accurate financial reports,and to ensure compliance with applicable laws.

Correct AnswerverifiedShow Answer

Accompanying the bank statement was a debit memorandum for an NSF check received from a customer.This item would require an adjusting entry including a

Correct AnswerverifiedA

An element of internal control is

Correct AnswerverifiedShow Answer

The bank reconciles its statement to the depositor's records.

Correct AnswerverifiedShow Answer

Using the following information,prepare a bank reconciliation for Salem Co.for May 31,2010.

Correct AnswerverifiedShow Answer

Adding a review of operations by an internal audit staff strengthens internal control.

Correct AnswerverifiedShow Answer

The bank reconciliation

Correct AnswerverifiedShow Answer

Accompanying the bank statement was a credit memorandum for a short-term note collected by the bank for the depositor.This item is a(n)

Correct AnswerverifiedShow Answer

When a firm uses internal auditors,it is adhering to which of the following internal control elements?

Correct AnswerverifiedShow Answer

The depositor reconciles the bank's statement to the depositor's records.

Correct AnswerverifiedShow Answer

Separating the responsibilities for purchasing,receiving,and paying for equipment is an example of the control procedure: separating operations,custody of assets,and accounting.

Correct AnswerverifiedShow Answer

In a voucher system,paid vouchers are transferred to a paid voucher file.

Correct AnswerverifiedShow Answer

Requiring employees to take annual vacations is part of which element of internal control?

Correct AnswerverifiedShow Answer

In preparing a bank reconciliation,the amount indicated by a debit memorandum for bank service charges is added to the balance per depositor's records.

Correct AnswerverifiedShow Answer

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Personnel policies would inclu...
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D

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C

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Usually it is part o...
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A

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