Accounting Unit 4 Exam

Which of the following statements correctly describes the reporting of cash? a. Cash cannot be combined with cash equivalents. b. Restricted cash funds may be combined with cash. c. Cash is listed first in the current assets section. d. Restricted cash funds cannot be reported as a current asset.

c. Cash is listed first in the current assets section.

all of the following are advantages of using subsidiary ledgers except they: a. show transactions affecting one customer or one creditor in a single account. b. free the general ledger of excessive details c. eliminate errors in individual accounts d. make possible a division of labor

c. eliminate errors in individual accounts

Which of the following is not one of the credit columns in the cash receipts journal: a. other accounts b. accounts payable c. accounts receivable d.sales

b. accounts payable

Cash sales of merchandise are recorded in the: a. cash payments journal b. cash receipts journal c. general journal d. sales journal

b. cash receipts journal

Permitting only designated personnel to handle cash receipts is an application of the principle of: a. segregation of duties b. establishment of responsibility c. independent internal verification d. human resource controls

b. establishment of responsibility

the reconciling item in a bank reconciliation that will results in an adjusting entry by the depositor is: a. outstanding checks b. a bank error c. deposit in transit d. bank service charges

d. bank service charges

The use of pre-numbered checks in disturbing cash is an application of the principle of: a. establishment of responsibility b. segregation of duties c. physical controls d. documentation procedures

d. documentation procedures

Each of the following is a subsidiary ledger except a. accounts receivable ledger b. accounts payable ledger c. customer's ledger d. general ledger

d. general ledger

Cash payments of merchandise are recorded in the: a. cash payments journal b. cash receipts journal c. general journal d. purchases journal

a. cash payments journal

the control features of bank account do not include: a. having bank auditors verify the correctness of the bank balance per books b. minimizing the amount of cash that must be kept on hand c. providing a double record of all bank transactions d. safeguarding cash by using a bank as a depository

a. having bank auditors verify the correctness of the bank balance per books

Credit purchases or equipment or supplies other than merchandise are recorded in the: a. cash payments journal b. cash receipts journal c. general journal d. purchases journal

c. general journal