The ending inventory of Larkin Company, which uses a periodic inventory system, was understated $7,000 on December 31, 2015. Because of this error, 2015 net income was

A.	understated by $2,000

B.	overstated by $7,000

C.	understated by $7,000

D.	overstated by $5,000

The use of a cash register for cash receipts is an example of the internal control principle of

A.	independent internal verification

B.	documentation

C.	segregation of duties

D.	physical controls

When a petty cash fund is in use,

A.	the size of the fund should be large enough to use to cash employees' bi-monthly payroll checks.

B.	an entry is made to Petty Cash when the fund is replenished to its original amount

C.	all purchases using these funds must have two signatures to approve the purchases.

Lack of agreement between the cash balance per bank and the cash balance per books is due to

A.	errors only.

B.	time lags, errors, collections and fees.

C.	poor internal control

D.	errors and bank notices of service charges.