Finance Questions? Ask a Financial Expert for Answers ASAP
1. Cash on a business's balance sheet would include all of the following except A) the amount on deposit in banks. B) checks made payable to the business. C) money orders. D) postage stamps.
2. The journal entry to establish a petty cash fund involves a debit to the Petty Cash account for the appropriate amount and a credit to the Cash account. A) True B) False
3. The purpose of the petty cash fund is to A) make all payments requiring cash. B) pay employees when the employee does not have a personal checking account. C) make payments requiring a small amount of cash. D) allow the owner to make large withdrawals of cash when necessary.
4. If cash in the register is $454 and sales for the day are $450, we would A) debit Cash Short and Over. B) credit Cash Short and Over. C) debit Cash for $450. D) credit Sales for $454.
5. The Cash Short and Over account is used so that the business need not investigate why there is a shortage or overage. A) True B) False
6. Determine the adjusted checkbook balance for Mountain High Expeditions from the following information on their bank reconciliation: Beginning checkbook balance $16,350 Deposit in transit 875 Outstanding checks 2,325 Bank error (charged for check from Dawson Creek Co.) 350 NSF check 260 Bank service charge 25 A) $17,450 B) $17,425 C) $16,065 D) $14,090
7. An example of an internal control over cash is the A) purchasing department approving all payments to suppliers. B) prenumbering of blank checks. C) presigning of blank checks. D) accounts payable department being responsible for signing checks before mailing.
8. Maria's Custom Framing begins the day with a $50 change fund in the cash register. At the end of the day, the cash register tape shows that $1,650 in cash sales were made during the day. How much cash should be in the cash register? A) $1,750 B) $1,700 C) $1,650 D) $1,600
9. One major provision of SOX is that public accounting firms are required to audit their own client's books. A) True B) False
10. The adjustments appearing in the company's checkbook section of the bank reconciliation will need to be A) added to the bank statement section. B) deleted from the company's records. C) journalized and posted to the company's ledger accounts. D) ignored as erroneous adjustments.
11. The owner of Michelle's Country Store compared her cash receipts with the cash register tape and found that she collected $685. However, the cash register tape showed $680 in cash sales. How should Michelle record the $5 difference? A) Debit Account Overage for $5. B) Credit Cash Short and Over for $5. C) Debit Cash Short and Over for $5. D) Dredit Miscellaneous Expense for $5.
12. The bank statement includes all of the following except A) a record of all checks that have cleared the bank. B) a record of outstanding checks. C) a record of all deposits received by the bank. D) the beginning balance in the bank account.
13. Internal controls are more effective in the accounts payable department when A) cash payments are made by check. B) cash payments are approved by the accounts receivable department. C) purchases have been made by using a credit card. D) payments are made based on the purchase order.
14. Checks listed on the bank statement and returned by the bank are known as outstanding checks. A) True B) False
15. From a business perspective, the receipt of a postdated check (one that is payable in the future) should be considered as an example of A) cash. B) accounts payable. C) accounts receivable. D) a post-paid asset.
16. SOX requires that companies maintain strong internal controls. A) True B) False
17. The Cash Short and Over account can be debited or credited depending on whether there is a cash shortage or a cash overage. A) True B) False
18. All employees in a business should have the ability to make cash deposits and write checks. A) True B) False
19. If sales amount to $749 and the cash in the cash register totals $752, A) Miscellaneous Expense will be credited for $3. B) Sales will be credited for $3. C) the Cash Short and Over account will be debited for $3. D) the Cash Short and Over account will be credited for $3.
20. The correct journal entry to record the establishment of a petty cash fund for $75 is to A) debit Cash for $75 and credit Prepaid Expense for $75. B) debit Petty Cash for $75 and credit Cash for $75. C) debit Petty Cash for $75 and credit Miscellaneous Expense for $75. D) debit Cash Short and Over for $75 and credit Cash for $75.
21. When reconciling the bank statement, we will subtract deposits in transit from the bank statement balance. A) True B) False
22. The purpose of the Sarbanes-Oxley Act of 2002, abbreviated as SOX, is to restore public confidence and trust in the financial statements of companies. A) True B) False
23. An internal control for a payment received by check through the mail is A) forwarding it directly to the bank for deposit. B) sending it directly to accounts payable for posting to the supplier's account. C) sending it directly to accounts receivable for posting to the customer's account. D) immediately endorsing the check "For Deposit Only."
24. A general rule about the definition of cash is that A) cash can only be considered as coin and currency. B) cash should not be exchanged for goods or services. C) if a bank will accept it as a deposit, it should be considered cash. D) cash is the only asset to be considered when valuing a company.
25. The petty cash fund should not be established for more than $150. A) True B) False
Answers as follows:
I hope this helps - some of the questions were a bit open ended and therefore I went with the option that best suited the answer. For example - Q25 - the petty cash fund limit is very much dependent on the individual corporations policy.
do you have the answers u need?
1. The Purchases account shows the amount of cash spent on merchandise inventory during the year. A) True B) False
these are the questions you need answered?
1. The Purchases account shows the amount of cash spent on merchandise inventory during the year. B) False
2. The balance in the Office Supplies account before adjustment is $3,500. A physical count at year-end reveals $2,700 of unused supplies. The adjusting entry consists of a debit to D) Office Supplies Expense and a credit to Office Supplies for $800.
3. The value of goods on hand at year-end is recorded in an expense account called Merchandise Inventory. A) True 4. Revenue will appear in the Income Statement Credit column of a work sheet. A) True
5. The Trial Balance Debit column of the work sheet shows Office Supplies with a balance of $3,800. An adjustment was recorded to show that $1,500 of supplies were used. What is the balance of the Office Supplies account in the Adjusted Trial Balance columns on the work sheet?D) $2,300 debit
6. What would be the effect on the financial statements if the Supplies account was not adjusted for the amount used during the month?D) Net Income would be overstated.
7. A net loss is recorded under the total of the Income Statement Credit column and the total of the Balance Sheet Credit column. B) False
8. In which columns will the Accumulated Depreciation account appear on a work sheet? C) Trial Balance Credit, Adjustments Credit, Adjusted Trial Balance Credit, and Balance Sheet Credit
9. A net income exists if the total of the Income Statement Credit column exceeds the total of the Income Statement Debit column. A) True
10. The total of the Income Statement Credit column exceeds the total of the Income Statement Debit column on a work sheet. This indicates
C) a net income.
. 11. The value of the store supplies used during an accounting period is no longer an asset; it has become an expense. A) True
12. The Salaries Expense account has a balance of $60,000 before adjustment and a balance of $62,500 after adjustment. What was the credit part of the adjusting entry? A) Salaries Expense for $2,500
13. On the work sheet, the Income Summary account contains) neither the beginning nor ending inventory figures. 14. Travis Farms did an inventory of its office supplies and found it had used $720 of supplies during the period. The adjusting entry to record the usage would include a debit to D) Office Supplies Expense for $720.
15. The journal entry to record the adjustment for salaries that have been earned but have not yet been paid at the end of an accounting period is A) debit Salaries Expense and credit Salaries Payable.
16. The total of the Income Statement Debit column exceeds the total of the Income Statement Credit column on a work sheet. This indicates B) a net income. 17. Purchases Returns and Allowances and Purchases Discounts will appear in the Income Statement Credit column of a work sheet. A) True 18. The information for completing the Income Statement and Balance Sheet columns of a work sheet comes from the . C) Adjusted Trial Balance columns in the work sheet. 19. An adjustment is made for Salaries Payable because B) wages that have been earned but not been paid need to be recorded.
20. In which columns will the drawing account appear on a work sheet? C) Adjusted Trial Balance Debit, Income Statement Debit, and Balance Sheet Debit
21. The cost of merchandise purchased during an accounting period is debited to the Purchases account. A) True 22. At the end of an accounting period, a liability should be recorded for all salaries earned by employees but not yet paid by the employer. A) True 23. What is the Adjusted Trial Balance total for Accumulated Depreciation if the trial balance showed a balance in Accumulated Depreciation of $8,660 and adjustments of $1,340 were recorded during the period? D) A credit balance of $7,320
24. A net income is recorded under the total of the Income Statement Credit column and the total of the Balance Sheet Debit column. A) True 25. A physical inventory is taken to determine the value of merchandise on hand. The journal entry to record this value is . . C) debit Supplies Inventory and credit Supplies Expense.
yes. I may have missed one but all good