1.)Having one person post entries to accounts receivable subsidiary ledger and a different person post to the Accounts Receivable Control account in the general ledger is an example of

a.)inadequate internal control.

b.)duplication of effort.

c.)external verification.

d.)segregation of duties.

2.)When two or more people get together for the purpose of circumventing prescribed controls, it is called

a.) a fraud committee.

b.) collusion.

c.) a division of duties.

d.) bonding of employees.

3.)From an internal control standpoint, the asset most susceptible to improper diversion and use is

a.) prepaid insurance.

b.) cash.

c.) buildings.

d.) land.

4.) Physical controls to safeguard assets do not include

a.) cashier department supervisors.

b.) vaults.

c.) employee identification badges.

d.) security guards.

5.)If employees are bonded

a.) it means that they are not allowed to handle cash.

b.) they have worked for the company for at least 10 years.

c.) they have been insured against misappropriation of assets.

d.) it is impossible for them to steal from the company.

6.) Blank checks

a.) should be safeguarded.

b.) should be presigned.

c.) do not need to be safeguarded since they must be signed to be valid. do not need to be safeguarded since they must be signed to be valid.

d.) should not be prenumbered.

7.) The entry to replenish a petty cash fund includes a credit toThe entry to replenish a petty cash fund includes a credit to

a.) Petty Cash.

b.) Cash.

c.) Freight-In.

d.) Postage Expense.

8.) A petty cash fund of $100 is replenished when the fund contains $3 in cash and receipts for $93. The entry to replenish the fund would

a.) credit Cash Over and Short for $4.credit Cash Over and Short for $4.

b.) credit Miscellaneous Revenue for $4.

c.) debit Cash Over and Short for $4.

d.) debit Miscellaneous Expense for $4.

9.) A petty cash fund should not be used for

a.)postage due.

b.) short-term loan to the custodian.

c.) taxi fares.

d.) customer lunches.

10.) The size of the petty cash fund is dependent on

a.) the wishes of the custodian of the fund.

b.) anticipated disbursements for the year.

c.) anticipated disbursements for a three- to four-week period.

d.) the size of the regular cash account.

11.) Replenishing the petty cash fund requires

a.) a debit to Cash.

b.) a credit to Petty Cash.

c.) a debit to various expense accounts.

d.) no accounting entry.

12.) A $100 petty cash fund has cash of $15 and receipts of $80. The journal entry to replenish the account would include a credit to

a.) Cash for $85.

b.) Petty Cash for $85.

c.) Cash Over and Short for $5.

d.) Cash for $80.

13.) A $100 petty cash fund has cash of $17 and receipts of $80. The journal entry to replenish the account would include a

a.) debit to Cash for $80.

b.) credit to Petty Cash for $83.

c.) debit to Cash Over and Short for $3.debit to Cash Over and Short for $3.

d.) credit to Cash for $80.

14.) A $100 petty cash fund has cash of $18 and receipts of $86. The journal entry to replenish the account would include a

a.) debit to Cash for $86.

b.) credit to Petty Cash for $86.

c.) credit to Cash Over and Short for $4.credit to Cash Over and Short for $4.

d.) credit to Cash for $86.

15.) A check returned by the bank marked "NSF" means

a.) no service fee.

b.) no signature found.

c.) not sufficiently filled-out.

d.) not sufficient funds.

16.) On a bank reconciliation, deposits in transit are

a.) added to the bank balance.

b.) deducted from the bank balance.

c.) added to the book balance.

d.) deducted from the book balance.

17.) In preparing a bank reconciliation, outstanding checks are

a.) added to the balance per bank.

b.)deducted from the balance per books.

c.) added to the balance per books.added to the balance per books.

d.) deducted from the balance per bank.

18.)If a check correctly written and paid by the bank for $428 is incorrectly recorded on the company's books for $482, the appropriate treatment on the bank reconciliation would be to

a.) add $54 to the bank's balance.

b.) add $54 to the book's balance.

c.) deduct $54 from the bank's balance.deduct $54 from the bank's balance.

d.) deduct $428 from the book's balance.

19.) An adjusting entry is not required forAn adjusting entry is not required for

a.) outstanding checks.

b.) collection of a note by the bank.

c.) NSF checks.

d.) bank service fees.

20.) At April 30, Mareska Company has the following bank information: cash balance per bank $4,600; outstanding checks $280; deposits in transit $550; credit memo for interest $10; bank service charge $20. What is Mareskas adjusted cash balance on April 30?

a.) $4,860

b.) $4,880

c.) $4,330

d.) $4,870