How are transactions recorded in accounts maintained on an accrual basis? Select the single best answer: A. Income and expenses are recorded when they occur B. as the sum of Accounts Payable account(s) C. as the sum of Accounts Receivable account(s) D. income and expenses are recorded when cash is received What is the general purpose of a provision for encumbrance of funds? Select the single best answer: A. unit costs are maintained at a minimum B. standardization of purchases are declared C. purchases are not in excess of available funds D. purchasing funds are equitably distributed among departments Which one of the following is NOT a part of the internal control of an accounting system for the handling of cash? Select the single best answer: A monthly reconciliations of cash receipts and bank account statements should be performed B. cash should be accounted for documented, and traceable to specific cash handiers C. employees handing or recording cash should use independent judgment D. duties of handling and recording cash should be performed by different employees The term ENCUMBRANCE is best described as: Select the single best answer: A. an authorization made by law or legislation directing payment out of government funds B. the use of government funds to pay for a current expense C. an outflow of funds to another person or organization to pay for goods or services D. restricted funds inside an account that are reserved for a specific debt or liability in the future