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A bank deposit made on June 30 did not appear on the June bank statement.In doing the June bank reconciliation,this deposit in transit should be


A) subtracted from the unadjusted book balance.
B) added to the unadjusted bank balance.
C) subtracted from the unadjusted bank balance.
D) added to the unadjusted book balance.

E) A) and B)
F) A) and D)

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A bank statement debit memo describes a transaction that increases a customer's account balance.

A) True
B) False

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When a "debit memo" is included in a bank statement,what effect does that have on the cash balance?

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A debit memo in the ...

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What were some of the major provisions of the Sarbanes-Oxley Act of 2002?

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The Act required establishment of the Pu...

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Which of the following is not considered an accounting control?


A) Performance evaluations of managers.
B) Requiring employees to take vacations or rotate job duties.
C) Bonding of employees.
D) Use of prenumbered documents.

E) C) and D)
F) None of the above

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During the reconciliation process,an accountant for Swann Company discovered that the bank deducted from its account a check written by Swan Company (a different company). During the reconciliation process,an accountant for Swann Company discovered that the bank deducted from its account a check written by Swan Company (a different company).

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Hyperion Company has established internal control policies and procedures in order to achieve the following objectives: (1) Safeguard the company's assets (2) Assure that the accounting records contain reliable information (3) Evaluate management performance effectively (4) Assure that employees comply with company policies Which of these objectives are primarily achieved by accounting controls?


A) Objectives 1 and 2
B) Objectives 2 and 3
C) Objectives 3 and 4
D) Objectives 1 and 4

E) B) and C)
F) None of the above

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While reconciling Swanson Company's bank statement an error was discovered.A $394 cash receipt for the collection of an account receivable was recorded in the company's books as $349.The deposit was recorded correctly by the bank. While reconciling Swanson Company's bank statement an error was discovered.A $394 cash receipt for the collection of an account receivable was recorded in the company's books as $349.The deposit was recorded correctly by the bank.

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The bank statement for Ronson Company included a debit memo for a bank service charge of $58. Required: a)Show the effects of recognizing the bank service charge on the financial statements by recording appropriate amounts in the financial statements model provided.Include dollar amounts of increases and decreases; for cash flow,indicate whether it is an operating activity,investing activity,or financing activity. The bank statement for Ronson Company included a debit memo for a bank service charge of $58. Required: a)Show the effects of recognizing the bank service charge on the financial statements by recording appropriate amounts in the financial statements model provided.Include dollar amounts of increases and decreases; for cash flow,indicate whether it is an operating activity,investing activity,or financing activity. b)Is the recognition of the bank service charge an asset source,use,or exchange transaction? b)Is the recognition of the bank service charge an asset source,use,or exchange transaction?

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a) blured image b)The bank servi...

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Which of the following is not a procedure for the control of cash receipts?


A) Immediate preparation of records of all cash receipts.
B) Giving customers written receipts for all monies paid.
C) Using prenumbered checks.
D) Depositing cash in the bank frequently.

E) A) and C)
F) A) and B)

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Effective internal controls for cash include:


A) making cash payments by prenumbered check.
B) depositing cash in the bank on a timely basis.
C) giving written cash receipts to customers as evidence of payment.
D) all of these.

E) A) and B)
F) B) and D)

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Independent auditors are


A) responsible for discovering fraud
B) responsible for providing reasonable assurance that financial statements are free of misstatements
C) responsible for providing absolute assurance that financial statements are free of errors
D) none of the above

E) None of the above
F) A) and C)

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Krieger Company's bank statement included an NSF check written by one of its customers.What effect will the entry to recognize the NSF check have on the company's financial statements? Krieger Company's bank statement included an NSF check written by one of its customers.What effect will the entry to recognize the NSF check have on the company's financial statements? A) Choice A B) Choice B C) Choice C D) Choice D


A) Choice A
B) Choice B
C) Choice C
D) Choice D

E) A) and B)
F) None of the above

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When a customer's NSF check is returned to a business with its bank statement,the business should make a journal entry increasing


A) Cash.
B) Accounts Receivable.
C) Accounts Payable.
D) Allowance for Doubtful Accounts.

E) C) and D)
F) B) and C)

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The Sarbanes-Oxley Act


A) was prompted by corporate bankruptcies and audit failures.
B) limits an auditor's ability to provide non-audit services to a client.
C) clarifies the responsibility of a company's management for its financial statements.
D) all of these.

E) A) and B)
F) B) and C)

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Which of the following situations provides the most likely indication that fraud exists?


A) Exelon Corporation's earnings per share this quarter is 10% higher than last quarter.
B) Quantum Corporation's sales this year is 20% higher than last year's sales.
C) Papillon Product Inc.'s profits have increased each for the last 5 years,but its cash reserves have decreased steadily in the same time period.
D) Bobadilla Bookstores opened 10 new stores during the most recent quarter.

E) A) and B)
F) All of the above

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The most favorable opinion that an auditor can express is the


A) Unqualified opinion
B) Qualified opinion
C) Adverse opinion
D) Disclaimer

E) None of the above
F) B) and D)

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What is a financial statement audit?

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It is a detailed examination of a compan...

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Effective separation of duties in an organization reduces the likelihood of theft.

A) True
B) False

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Effective separation of duties in a business allows the work of one employee to serve as a check on the work of other employees.

A) True
B) False

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