Navigation » List of Schools » Glendale Community College » Accounting » Accounting 101 – Financial Accounting » Spring 2021 » Chapter 4 Quiz
Below are the questions for the exam with the choices of answers:
Question #1
A Cash received from a customer.
B Cash received from the issuance of common stock.
C Cash paid for supplies.
D Cash received from the sale of a used company truck.
Question #2
A Personally certify the company’s financial statements.
B Be compensated only when the company is profitable.
C Work more than 40 hours per week.
D Hire an independent auditor.
Question #3
A Interest on bank deposit.
B Checks outstanding.
C An error by the bank.
D Deposits outstanding.
Question #4
A Receipt of cash from selling a building.
B Receipt of cash from bank borrowing.
C Payment for prepaid insurance.
D Payment of dividends to stockholders.
Question #5
A The company should establish formal guidelines to handle cash receipts and make purchases.
B Important documents should be kept in a safe place, and electronic files should be backed up regularly.
C Employees should be made aware of the company’s internal control policies.
D Management periodically determines whether the amount of physical assets agree with the accounting records.
Question #6
A Ensure checks are serially numbered and signed only by authorized employees.
B Require only one signature for larger checks.
C The employee who authorizes payment should also be the employee who prepares the check.
D Employees responsible for making cash disbursements should also be in charge of cash receipts.
Question #7
A As stewards of the company’s assets.
B In their own best interest.
C As owners of the company.
D As creditors of the company.
Question #8
A Provide cash on hand for minor expenditures.
B Allow the company to save cash for major future purchases.
C Provide a convenient form of payment for the company’s customers.
D Pay employee salaries at the end of each period.
Question #9
A File reports with the Securities and Exchange Commission.
B Use either cash or accrual- basis accounting.
C File their tax return with the Internal Revenue Service.
D Use accrual-basis accounting.
Question #10
A Organized the Internal Revenue Service.
B Passed the Sarbanes-Oxley Act.
C Enacted the Securities and Exchange Commission.
D Established the Financial Accounting Standards Board.
Question #11
A Cash received from the sale of a used company truck.
B Cash paid for supplies.
C Cash received from the issuance of common stock.
D Cash received from a customer.
Question #12
A Cash received from a bank loan.
B Cash received from the issuance of common stock.
C Cash paid for supplies.
D Cash received from the sale of a used company truck.
Question #13
A Checks received from customers.
B Debit card sales, checks received from customers and coins and currency.
C Debit card sales.
D Coins and currency.
Question #14
A Increased regulations related to internal control.
B Increased regulations related to auditor–client relations, increased regulations related to corporate executive accountability and increased regulations related to internal control.
C Increased regulations related to auditor–client relations.
D Increased regulations related to corporate executive accountability.
Question #15
A Payment for a new operating equipment.
B Services provided to customers on account.
C Repayment of borrowed money.
D Payment for employee salaries.
Question #16
A The employee who authorizes payments should also prepare the check.
B Set maximum purchase limits on debit cards and credit cards.
C Make all cash disbursements using cash rather than debit cards or credit cards.
D The employee responsible for making cash disbursements should be in charge of cash receipts.
Question #17
A Prevent bankruptcy.
B Maintain normal operations, respond quickly to new opportunities and prevent bankruptcy.
C Respond quickly to new opportunities.
D Maintain normal operations.
Question #18
A The amount of cash withdrawn from the fund during the accounting period.
B The amount of cash used to establish the fund.
C The established balance of the fund less all vouchers written during the accounting period.
D All vouchers written during the accounting period.
Question #19
A Investments with maturity dates greater than three months.
B Accounts receivable.
C Accounts payable.
D Checks received from customers.
Question #20
A Subtracted from the company’s cash balance.
B Added to the bank’s cash balance.
C Subtracted from the bank’s cash balance.
D Added to the company’s cash balance.
Question #21
A Interest on bank deposit.
B Bank service fees.
C NSF check.
D Deposits outstanding.
E
Question #22
A
B Added to the bank’s cash balance.
C Subtracted from the bank’s cash balance.
D Subtracted from the company’s cash balance.
E Added to the company’s cash balance.
Question #23
A Investment in short-term securities.
B Cash held in the bank.
C Cash on hand to pay for minor purchases.
D Cash used to pay employee salaries.
Question #24
A Provide financial statements.
B Document and assess internal controls.
C File their tax return with the Internal Revenue Service.
D Provide healthcare for employees.
Question #25
A Requiring the employee receiving the cash from the customer to also deposit the cash into the company’s bank account.
B Allowing customers to pay with a credit card.
C Allowing customers to pay with a debit card.
D Recording cash receipts as soon as they are received.
Question #26
A Service fees.
B An error by the company.
C NSF checks.
D Checks outstanding.
Question #27
A Mismatching revenues and expenses.
B Improper asset valuation, fictitious revenues from a fake customer and mismatching revenues and expenses.
C Improper asset valuation.
D Fictitious revenues from a fake customer.
Question #28
A Accounting errors made by the company.
B Accounting errors made by the bank.
C Timing differences of recording cash transactions by the company and by the bank.
D Cash theft by the company’s employees.
Question #29
A Cash sales to customers.
B Payment for advertising.
C Payment for land.
D Payment of dividends to stockholders.
Question #30
A $120,000.00
B $90,000.00
C $20,000.00
D $50,000.00
Question #31
A Only checks are used for payment of purchases and the same person who makes deposits should also record the deposits.
B The person who makes deposits should NOT record the deposits.
C Only checks are used for payment of purchases.
D The same person who makes deposits should also record the deposits.
Question #32
A The ethical tone set by top management.
B Accountability through separation of duties.
C The reliability of financial information.
D The risk of failing to achieve company objectives.
Question #33
A Credit card purchases.
B Amounts held in checking accounts.
C Prepaid insurance.
D Investments in a 6-month Certificate of Deposit.
Question #34
A Cash is debited.
B Retained Earnings is debited.
C Accounts Payable is credited.
D Expenses are credited.
Question #35
A The external auditors of the company should have no contact with managers while the audit is taking place.
B The company’s financial accountant should not share information with the company’s tax accountant.
C Employee fraud is less likely to occur when access to assets and access to accounting records are separated.
D Duties of middle-level managers of the company should be clearly separated from those of top executives.
Question #36
A Deposits outstanding.
B An error by the bank.
C Checks outstanding.
D Interest earned.
Question #37
A The company’s top executives.
B The company’s external auditors.
C The company’s board of directors.
D The company’s stockholders.
Question #38
A Cash.
B Accounts Payable.
C Supplies.
D Supplies Expense.
Question #39
A Corporate scandals involving unethical behavior of top executives.
B The establishment of the Securities and Exchange Commission (SEC).
C Increasing inflation.
D Increasing pressure of foreign competition for American products and services.
Question #40
A To improve the accuracy and reliability of accounting information.
B To assist top executives in planning employment capacity.
C To minimize tax payments to the Internal Revenue Service (IRS).
D To help managers determine which projects are likely to be more profitable.