Sample Exam 3 - ACCT201 Sample Exam 3 Name: _ Date: _ 1....

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ACCT201 Sample Exam 3 Name: __________________________ Date: _____________ 1. Joe's Grocery Store has the following policy. 'Only one cashier can have access to a cash drawer.' Which internal control principle supports this policy? A) Documentation procedures B) Segregation of duties C) Physical, mechanical, and electronic controls D) Establishment of responsibilities 2. A petty cash fund should be replenished A) every day. B) at the end of every accounting period. C) once a year. D) as soon as an expense is paid from the fund. 3. The following information was taken from Bounders Company cash budget for the month of July: If the company has a policy of maintaining end of the month cash balance of $50,000, the amount the company would have to borrow is A) $20,000. B) $10,000. C) $30,000. D) $12,000. 4. Rhoden Company wrote checks totaling $17,080 during October and $18,650 during November. $16,240 of these checks cleared the bank in October, and $18,220 cleared the bank in November. What was the amount of outstanding checks on November 30? A) $1,270. B) $230. C) $610. D) $1,980. 5. Which one of the following sections would not appear on a cash budget? A) Cash receipts B) Financing needed C) Investing D) Cash disbursements Page 1 Cash receipts 48,000 Cash disbursements 68,000 Beginning cash balance $50,000
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ACCT201 Sample Exam 3 6. An adjusting entry is not required for A) outstanding checks. B) collection of a note by the bank. C) NSF checks. D) bank service charges. 7. A consequence of separation of duties is that A) theft by employees becomes impossible. B) operations become extremely inefficient because of constant training of employees. C) more employees will need to be bonded. D) theft is still possible when several employees are involved. 8. Which of the following is not an internal control activity for cash? A) The number of persons who have access to cash should be limited. B) The functions of record keeping and maintaining custody of cash should be combined. C) Surprise audits of cash on hand should be made occasionally. D) All cash receipts should be recorded promptly. 9. Which of the following would be deducted from the balance per books on a bank reconciliation? A) Outstanding checks B) Deposits in transit C) Notes collected by the bank D) Service charges 10. Cash equivalents do not include A) money market accounts. B) commercial paper. C) U.S. Treasury bills. D) Long-term investment. 11. A $100 petty cash fund has cash of $14 and receipts of $85. The journal entry to replenish the account would include A) debit to Cash for $85. B) credit to Petty Cash for $85. C) debit to Petty Cash for $86. D) credit to Cash for $86. Page 2
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ACCT201 Sample Exam 3 12. Which of the following is an example of a bank reconciliation item that requires an adjusting entry? A)
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Sample Exam 3 - ACCT201 Sample Exam 3 Name: _ Date: _ 1....

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