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Quiz 7

  1. The internal control structure encompasses all of the following except the:

    1. attitude of management toward controls
    2. accounting records and system
    3. amount of autonomy held by various divisions within a company
    4. specific procedures for controlling transactions

  2. The separation of duties in terms of cash transactions means that separate individuals should be responsible for authorization, custody, and:

    1. approval
    2. recordkeeping
    3. control
    4. protection

  3. Which of the following is least likely to lead to a breakdown in internal control?

    1. Human errors and mistakes
    2. Employees carrying out their duties as prescribed
    3. Management taking full control of an operation
    4. Two employees working together to steal assets

  4. Which of the following documents should be presented and agreed on before a check authorization is prepared?

    1. Purchase requistion and purchase order
    2. Purchase order and receiving report
    3. Purchase requistion, purchase order, invoice
    4. Purchase order, invoice, and receiving report

  5. On a bank reconciliation, which of the following would be added to the balance per bank?

    1. Outstanding checks
    2. Deposits in transit
    3. A service charge
    4. Interest on the balance

  6. Which of the following items in a bank reconciliation would required a journal entry?

    1. Outstanding checks
    2. Deposits in transit
    3. Interest on the balance
    4. The adjusted Cash balance

  7. The entry to replenish a $50 petty cash fund that has $20 cash and a receipt for $30 of postage would include a credit to:

    1. Cash
    2. Petty Cash
    3. Postage Expense
    4. Prepaid Postage

  8. The voucher system strengthens internal control by requiring that a voucher be prepared to authorize payment of a liability at the time that the liability is:

    1. paid
    2. incurred
    3. planned
    4. audited

  9. To help the company pay within the discount period, unpaid vouchers are filled by:

    1. voucher number
    2. date of authorization
    3. due date
    4. check number

  10. Under the voucher system, at the end of the accounting period, the amount of accounts payable on the balance sheet should equal:

    1. the total of the schedule of unpaid vouchers
    2. the amount paid to creditors during the accounting period
    3. the total of the subsidiary accounts payable file
    4. none of the above

 

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