You are watching: Which of the following best describes the goal of internal controls?
The Sarbanes-Oxley Act requires that companies must:A. Conduct customer surveys annually to encertain satisfaction through products and solutions.B. Document inner controls and assess their adequacy each year.C. Pay taxes owed to the Internal Revenue Service by the tax filing day.D. Devise a budobtain annually to encertain cash outflows are not higher than cash inflows.
Under the provisions of the Sarbanes-Oxley Act, auditors need to perform which of the following?A. Provide nonaudit services for their clients.B. Audit public service providers whose chief executives worked for the audit firm in the precedingyear.C. Be hired by firm monitoring.D. Maintain functioning files for at least salso years complying with an audit
Which of the following ideal defines the goal of internal controls?A. Ensuring the organization is profitable.B. Enhancing the wellness of employees.C. Improving the accuracy and the relicapacity of financial information.D. Ensuring the compliance via taxes regulations.
A structure for making an interior control system is offered by the:A. Committee of sponsoring organizations.B. Financial Accounting Standards Board.C. SecuritiesandExchangeCommission.D. Internationwide Accounting Standards Board.
The component of inner regulate that includes the policies and steps that aid ensure that management"s directives are being brought out is:A. Monitoring.B. Indevelopment and also interaction.C. Risk assessment.D. Control tasks.
The component of inner control that identifies inner and also exterior determinants that could prevent a company"s missions from being accomplished is:A. Monitoring.B. Indevelopment and also interaction.C. Risk assessment.D. Control tasks.
The component of inner control that includes the formal procedures for reporting control deficiencies is:A. Monitoring.B. Information and interaction.C. Risk assessment.D. Control activities.
Which of the following is not an instance of preventative controls?A. Separation of duties.B. Physical controls.C. Suitable authorization.D. Reconciliations.
Keeping gives in a locked room through accessibility permitted just to authorized personnel is an instance of which precautionary control?A. Separation of duties.B. Physical controls.C. Appropriate authorization.D. Employee monitoring.
Providing employees through appropriate guidance to ensure they have the understanding vital to bring out their task duties is an instance of which precautionary control?A. Separation of duties.B. Physical controls.C. Ideal authorization.D. Employee management.
Which of the following is an instance of detective controls?A. Separation of duties.B. Physical controls.C. Appropriate authorization.D. Reconciliations.
The act of collusion refers to:A. Top management and also lower-level employees working together to share information important for effective inner controls.B. Two or even more people acting in coordination to circumvent internal controls.C. Management working via an auditor to proccasion occupational fraud.D. Middle-level supervisors taking full obligation for reliable inner controls.
Which of the complying with is considered cash for financial reporting purposes?A. Accounts receivable.B. Investments with maturity days greater than 3 months.C. Checks got from customers.D. Accounts payable.
Cash might not include: A. Fopower currency.B. Money orders.C. Accounts receivable.D. Undeposited customer checks.
The term frequently supplied to describe short-term investments that have a maturity date no much longer than 3 months from the day of purchase is:A. Accounts receivable.B. Cash equivalents.C. Accounts payable.D. Short-term investments.
Which of the following sales would certainly commonly be reported as a cash sale?A. Sale in exadjust for office provides obtained.B. Sale in exchange for devices got.C. Saleonaccount.D. Sale via credit card.
McGregor Company enables customers to pay with crmodify cards. The credit card firm charges McGregor 3% of the sale. When a customer uses a crmodify card to pay McGregor $200 for solutions offered, McGregor would:A. Debit Cash for $200.B. Credit Service Revenue for $194.C. Debit Service Fee Expense for $6.D. Credit Service Revenue for $206.
When a sale is made to a customer that pays via a delittle card, the company records:A. A delittle to Accounts Payable.B. A debit to Accounts Receivable.C. A delittle bit to Cash.D. No enattempt until the delittle bit card transaction gets rid of the bank.
A customer purchased a $2,000 item at ApplianceWorld, paying with a crmodify card. ApplianceWorld is charged a 2% fee by the credit card firm. When recording this sale, ApplianceWorld would:A. Delittle Accounts Receivablefor $2,000.B. Credit Sales Revenue for $2,000.C. Credit Sales Revenue for $1,960.D. Credit Deferred Revenue for $2,000.
A bank reconciliation reconciles the financial institution statement with the company"s:A. Cash from operating activities.B. Net cash circulation in the statement of cash flows.C. Cash account in the balance sheet.D. Net earnings in the revenue statement.
What is the primary function of a bank reconciliation?A. To ensure that for all cash transactions debits equal credits.B. To ensure that customers are paying amounts owed on a timely basis.C. To encertain the bank balance per reconciliation is equal to the company balance per reconciliation.D. To encertain cash receipts are better than cash disbursements.
C. To encertain the financial institution balance per reconciliation is equal to the company balance per reconciliation.
Which of the following items would cause the balance of cash in the financial institution statement not to equal the balance of cash in the bookkeeping records?A. The company purchased gives making use of a debit card.B. The agency has cash receipts that have been deposited in the financial institution.C. The agency deposited a customer check that was discovered by the financial institution to have insufficientfunds.D. The company created checks that have cleared the bank.
Which of the following items would certainly reason the balance of cash in the financial institution statement to be higher than the balance of cash in the audit records?A. The agency composed checks that have not cleared the bank.B. The agency purchased offers using a delittle bit card.C. The firm has cash receipts that have not been deposited in the bank.D. The agency deposited a customer inspect that was discovered by the bank to have actually insufficient funds.
A great interior regulate system would certainly require that the employee that handles cash should not be affiliated in:A. Reconciling the bank statement.B. The accounts payable feature.C. Hiring decisions.D. Dailyoperationsoftheagency.
Which of the following is correct with respect to a financial institution reconciliation?A. Subtract interemainder earned from the bank"s balance.B. Add service charge to the company"s balance.C. Subtract NSF checks from the company"s balance.D. Add deposits outstanding to the company"s balance.
After preparing the bank reconciliation, an NSF examine would certainly cause which of the following when recording the adjustment to the company"s cash balance?A. Delittle to Service Fee Expense.B. Crmodify to Accounts Payable.C. Crmodify to organization revenue.D. Delittle to Accounts Receivable.
Company kind of balance before reconciliation- $5,000Checks outstanding- $2,500Notes built up by the bank- $2,200Service fee- $50Deposits outstanding- $2,000What is the correct cash balance for Sooner Company?A. $7,150. B. $5,150. C. $7,650. D. $7,250.
When preparing a financial institution reconciliation, a deposit superior would be:A. Added to the company"s cash balance.B. Added to the bank"s cash balance.C. Subtracted from the company"s cash balance.D. Subtracted from the bank"s cash balance.
Which of the complying with would NOT must be accounted for in a financial institution reconciliation?A. Deposits outstanding taped by the agency yet not the financial institution.B. Interemainder earned taped by the bank yet not the firm.C. NSF checks tape-recorded by the financial institution yet not by the agency.D. Checks created by the firm and videotaped by the bank.
On May 31, Money Corporation"s Cash account verified a balance of $10,000 prior to the bank reconciliation was all set. After examining the May bank statement and items contained via it, the company"s accountant uncovered the complying with items:Checks outstanding- $2,250Deposits outstanding- $1,900NSF check- $100Service fees- $40What is the amount of cash that have to be reported in the company"s balance sheet as of May 31?A. $9,860. B. $9,650. C. $10,130. D. $10,410.
Cash transactions taped by the bank but not yet taped by the firm incorporate every one of the adhering to exceptA. Service fees.B. Interemainder earned.C. Checks impressive. D. NSF checks.
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The adhering to indevelopment was taken from the financial institution reconciliation for Mooner Sooner Inc. at the finish of the year:Bank balance: $8,000Checks outstanding: $5,800Note built up by the bank: $1,500 Service fee: $20Deposits outstanding: $4,000NSF check (bad check) reverted for $300What is the correct cash balance that must be reported in Mooner Sooner"s balance sheet at the end of the year?A. $10,200. B. $7,400. C. $6,200. D. $6,160.