Bank reconciliations are NOT:

sufficient to uncover all fraud.

to be completed by all companies.

useful.

an important cash control.

Flag this Question

Question 21 pts

Which of the following statements is correct regarding a recovery entry for accounts receivable?

It only effects the statement of income.

It only effects the statement of financial position.

It effects both the statements of financial position and of income.

It effects neither the statement of financial position or statement of income.

Flag this Question

Question 31 pts

The inventory of a grocery store retailer, such as Safeway, would consist primarily of _______________ .

finished goods inventory.

The company would likely hold significant amounts of each of the other three types of inventory.

work in process inventory.

raw materials inventory.

Flag this Question

Question 41 pts

A company that makes the following journal entry every time a sale occurs, is using what type of inventory system?

DR COGS expense

CR Inventory

A specific identification system.

A periodic system.

A just-in-time system.

A perpetual system.

Flag this Question

Question 51 pts

What is the correct equation to calculate the cost of good sold in a periodic inventory system?

Beginning inventory - Purchases + Ending inventory

Beginning inventory + Purchases + Ending inventory

Beginning inventory + Purchases - Ending inventory

Beginning inventory - Purchases - Ending inventory

Flag this Question

Question 61 pts

The use of the FIFO inventory flow assumptions means that:

the net income will always be higher.

the company will eliminate the possibility of inventory obsolescence.

the oldest units are included in ending inventory.

the oldest units are included in cost of goods sold.

Flag this Question

Question 71 pts

According to IFRS, how should inventory be valued on the balance sheet?

At historical cost.

Lower of cost and net realisable value.

At the total cost to purchase, market and sell the inventory.

At fair market value.

Flag this Question

Question 81 pts

Which of the following is correct for a company using the credit sales method to estimate the company's bad debts expense?

Bad debts expense x historic % = Allowance for doubtful accounts

Bad debts expense = Accounts receivable x historic %

Bad debts expense = Credit sales x historic %

Bad debts expense = Sales revenue x historic %

Flag this Question

Question 91 pts

If a company is experiencing cash flow shortages it may choose to sell its receivables to a third party. This is known as ________________ .

factoring.

cash management.

write-off.

internal control.

Flag this Question

Question 101 pts

In which of the following situations would the car be classified as inventory?

A car owned by a company, and used by a sales person to make deliveries.

All of the other answers are correct.

A second-hand car purchased by a used car dealer, which is sitting on the lot available for sale.

A car owned by a company, and used by the company President.