Q1. A very small company would have the most difficulty in implementing which of the following internal control activities? Xxxxxxxx Limited access to assets Q2. Under the perpetual inventory system, which of the following accounts would not be used? Xxxxxxxxx Sales Q3. Before a check authorization is issued, the following documents must be in agreement, except for the Remittance advice. Q4. When payment is received by mail, a detailed list of such receipts would not be retained by the Receiving department. Q5. Which of the following is an appropriate internal control activity for cash? Xxxxxxxx Banking facilities should be used as little as possible. Q6. Which of the following goods would not be included in merchandise inventory for a purchasing company? Goods in transit shipped FOB destination Q7. A purchase order is sent from a company’s Purchasing department to the supplier. Q8. Which of the following is not an internal control activity for cash? Xxxxxxxx The amount of cash on hand should be kept to a minimum. Q9. Which of the following documents would not originate with the purchasing company? Invoice Q10. Chupka Company experienced the following events during the period: 1. A tabulation of invoices at the end of the day showed $800 in MasterCard invoices, which were deposited in a bank account at full value less a 5 percent discount. 2. Made a sale on American Express card for $400 and mailed invoice to
4 percent. 3. Received payment from American Express at 96 percent of face value. The entry to record transaction 3 would include a(n) Xxxxxxx increase in Cash for $400. Q1. Which of the following is an inventory costing method? Specific identification Q2. A retail store has goods available for sake of $2 million at retail and $1,100,000 at cost, and ending inventory of $160,000 at retail. What is estimated cost of ending inventory? $88,000 Q3. Assuming that a perpetual inventory system is used, what is ending inventory on a FIFO basis? $3,704 Q4. An overstatement of ending inventory in one period results in Xxxxxx an overstatement of the ending inventory of the next period. Q5. Inventory turnover is expressed in terms of Times. Q6. Manufacturing overhead would not include which of the following costs? Xxxxxxxx Supervisory salaries Q7. A company has cost of goods available for sale of $250,000, sales of $312,000, and a gross profit percentage of 30 percent. Using the gross profit method, what is the ending inventory? $31,600 Q8. A periodic inventory system is used. Using LIFO, cost of goods sold is Xxxxxxxx $4,056. Q9. Which of the following is an inventory processing system? Perpetual
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