Question 1

Accompanying the bank statement was a debit memorandum for an NSF check received from a customer.This item would be included on the bank reconciliation as a(n) :

Accepted Answer

A)  deduction from the cash balance per books.
B)  addition to the cash balance per bank.
C)  deduction from the cash balance per bank.
D)  addition to the cash balance per books.E) A) and D)
F) C) and D)

Question 2

The Sarbanes-Oxley Act requires companies and their independent accountants to report on the effectiveness of the company's internal controls.

Accepted Answer

A) True 
 B)False

Question 3

The framework that has become widely accepted as the standard by which companies design,analyze,and evaluate internal controls is the:

Accepted Answer

A)  Internal Control - Integrated Framework by the Committee of Sponsoring Organizations.
B)  Internal Control - Integrated Framework by the Congress of Special Offerings.
C)  Internal Control Localized Structure by the Committee of Sponsoring Organizations.
D)  Internal Control Localized Structure by the Congress of Special Offerings.E) A) and B)
F) A) and C)

Question 4

A debit memorandum from the bank indicates that the bank has deducted an amount from the depositor's account.

Accepted Answer

A) True 
 B)False

Question 5

A voucher is a written authorization to make a cash payment.

Accepted Answer

A) True 
 B)False

Question 6

A bank reconciliation is an important part of the system of internal controls.

Accepted Answer

A) True 
 B)False

Question 7

A primary cause of failure of new companies is that .

Accepted Answer

A)  they don't have sufficient cash from debt or equity financing to operate long enough to generate positive cash flows from operations
B)  they don't have sufficient cash to operate long enough to generate positive cash flows from financing activities
C)  they pay double taxation
D)  the occurrence of fraud is higher in such companiesE) A) and D)
F) All of the above

Question 8

Depositing all cash,checks,etc.in a bank and paying with checks is an internal control procedure over cash.

Accepted Answer

A) True 
 B)False

Question 9

A remittance advice is the notification accompanying the check issued to a creditor that states the specific invoice being paid.

Accepted Answer

A) True 
 B)False

Question 10

A special cash fund used to make small payments that occur frequently is called a(n) :

Accepted Answer

A)  operating expenses fund.
B)  change fund.
C)  market fund.
D)  petty cash fund.E) B) and C)
F) A) and B)

Question 11

For each of the following procedures,indicate whether it is an internal control strength or a weakness.Also,for each weakness,explain why it is a weakness and how it can be corrected.

Accepted Answer

(a) Weakness.All new hires need to be tr...

Question 12

Which of the following is considered as cash?

Accepted Answer

A)  Commercial papers
B)  Bonds
C)  Checks
D)  EquitiesE) All of the above
F) B) and C)

Exam 5: Sarbanes-Oxley, internal Control, and Cash

The framework that has become widely accepted as the standard by which companies design,analyze,and evaluate internal controls is the:

Correct Answer
verified

A debit memorandum from the bank indicates that the bank has deducted an amount from the depositor's account.

Correct Answer
verified

A remittance advice is the notification accompanying the check issued to a creditor that states the specific invoice being paid.

Correct Answer
verified

A primary cause of failure of new companies is that .

Correct Answer
verified

A voucher is a written authorization to make a cash payment.

Correct Answer
verified

A special cash fund used to make small payments that occur frequently is called a(n) :

Correct Answer
verified

Depositing all cash,checks,etc.in a bank and paying with checks is an internal control procedure over cash.

Correct Answer
verified

The Sarbanes-Oxley Act requires companies and their independent accountants to report on the effectiveness of the company's internal controls.

Correct Answer
verified

A bank reconciliation is an important part of the system of internal controls.

Correct Answer
verified

For each of the following procedures,indicate whether it is an internal control strength or a weakness.Also,for each weakness,explain why it is a weakness and how it can be corrected.

Correct Answer
verified
(a) Weakness.All new hires need to be tr...
View Answer

Which of the following is considered as cash?

Correct Answer
verified

Accompanying the bank statement was a debit memorandum for an NSF check received from a customer.This item would be included on the bank reconciliation as a(n) :

Correct Answer
verified

Exam 5: Sarbanes-Oxley, internal Control, and Cash

The framework that has become widely accepted as the standard by which companies design,analyze,and evaluate internal controls is the:

Correct AnswerverifiedShow Answer

A debit memorandum from the bank indicates that the bank has deducted an amount from the depositor's account.

Correct AnswerverifiedShow Answer

A remittance advice is the notification accompanying the check issued to a creditor that states the specific invoice being paid.

Correct AnswerverifiedShow Answer

A primary cause of failure of new companies is that .

Correct AnswerverifiedShow Answer

A voucher is a written authorization to make a cash payment.

Correct AnswerverifiedShow Answer

A special cash fund used to make small payments that occur frequently is called a(n) :

Correct AnswerverifiedShow Answer

Depositing all cash,checks,etc.in a bank and paying with checks is an internal control procedure over cash.

Correct AnswerverifiedShow Answer

The Sarbanes-Oxley Act requires companies and their independent accountants to report on the effectiveness of the company's internal controls.

Correct AnswerverifiedShow Answer

A bank reconciliation is an important part of the system of internal controls.

Correct AnswerverifiedShow Answer

For each of the following procedures,indicate whether it is an internal control strength or a weakness.Also,for each weakness,explain why it is a weakness and how it can be corrected.

Correct Answerverified(a) Weakness.All new hires need to be tr...View AnswerShow Answer

Which of the following is considered as cash?

Correct AnswerverifiedShow Answer

Accompanying the bank statement was a debit memorandum for an NSF check received from a customer.This item would be included on the bank reconciliation as a(n) :

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
(a) Weakness.All new hires need to be tr...
View Answer

Correct Answer
verified

Correct Answer
verified