Ch. 32 & 33 - Study Guide

the petty cash fund is established by writing a check payable to "petty cash" or:

"cash"

If the petty cash fund was originally $50, and it has been depleted down to $3, a new petty cash check should be written for:

$47

If your receipts for 4 months add up to $200,000, what is your average monthly gross production?

$50,000

Which of the following is the best gross collection ratio?

1.0

A bank statement obtained through an ATM usually contains the last _____ transactions made on an account.

10

The A/R ratio has a goal of:

2 months or less

secure document check face

A face that makes replication difficult.

foil hologram

A three-dimensional graphic foil embedded in the check to provide additional protection against duplication.

chemical reactive paper

A uniquely treated paper that will show visible signs of chemical tampering.

checking account

Bank account into which money may be deposited and checks may be written against.

ATM

Banking machine operated by inserting a debit, credit, or bank card and entering personal identification number code

third-party check

Check made out to the patient by someone unknown to you.

limited check

Check that will be marked void if written over a certain amount.

ABA number

Code number found in the upper-right hand corner of a printed check

toner adhesion

Endures that toner from your printer cannot be removed from the paper without damage.

What is the correct way to write the numerical amount $5.62 as a written amount?

Five and 62/100

certified check

Guaranteed check that is always acceptable when a personal check is not.

colored pantograph

If the unique colored background is not present, the check is not authentic.

warning band

In the border of the check indicating the document contains security features.

MP logo

In the signature line of laser checks and in the border on manual checks repeats the words "original document".

prismatic multicolored background

Includes subtle gradations that make copying and reproduction difficult.

padlock icon

Inside the border that indicates at least two security features are included on the check.

deposit slip

Itemized list of cash and checks deposited in a checking account.

electronic funds transfer system

Method of crediting and debiting accounts by computer without checks or deposit slips.

currency

Money produced by the Federal Reserve in the form of paper bills and coins

deposit

Money put into a bank account, increasing the balance

money order

Negotiable instrument often used by individuals who do not have checking accounts or to meet the requirement for purchasing an item or service.

MICR Numbers

Numbers printed on the check in magnetic ink that contain the routing (ABA) number.

endorser

Payee on a check.

endorsement

Payee's signature on the back of a check.

maker

Payer of the check.

agent

Person authorized to act for another person

security screen

Printed on the back of each check that reads "original document" with a list of the security features and will not photocopy clearly.

deposit record

Record of a deposit given to a customer at the time of the deposit.

bank statement

Record of checking account activity sent to a customer, usually on a monthly basis.

check register

Record showing the check number, person to whom check is paid, amount of check, date, and balance.

thermochromic-heat sensitive icon

The ink cannot be applied by conventional photocopiers, ensuring authenticity of the document.

accounts payable

Total amounts owed by a practice to suppliers and other service providers for regular business operating expenses.

cashier's check

Type of check in which the purchaser pays the bank the full amount of the check.

If a mistake is made in writing a check, it is necessary to write "_____" across the check and stub and write a new one.

VOID

visible or invisible fibers

Visible fibers of various lengths and color complicate copying, and invisible fibers can be viewed from either side of the paper using black (UV) light.

an overdraft is when:

a check is more than the amount in the bank account

It is typically the responsibility of the _____ to produce the values used in cost-benefits analysis.

accountant

The use of checks became common:

after World War II (WWII)

When invoices are held for payment, they are typically filed:

alphabetically by the supplier's name

Cost-benefit analysis is not:

an advanced, complex type of cost analysis

Deposits should be always be delivered to the bank:

at different times and days of the week

A(n) _____ is also known as a statement of financial position.

balance sheet

Accept a postal money order with more than one endorsement

be highly organized

Accept a check marked "paid in full" unless it does pay the full balance

best practice (good policy)

Accept a postal money order with only one endorsement

best practice (good policy)

Stamp it with the deposit endorsement

best practice (good policy)

When completing a stub or register, you should:

bring forward the balance from the previous stub or entry

When writing a check, the date:

can be written or numerical

Traveler's checks are listed as ______ on a deposit slip.

checks

When your medical office receives an invoice from a supplier, in which section does the name of the medical practice appear?

client details

Adds another layer of detail to your business's bookkeeping practices.

con

Business see small processing fees for each credit card transaction.

con

Requires the minor, but additional, step of adding a pin pad to a credit card terminal.

con

The _____ formula demonstrates a cost of a specific procedure or service.

cost ratio

_____ is a digital or virtual currency that uses cryptography for security, making it difficult to counterfeit.

cryptocurrency

The date bu which payment should be made is called the:

due date

A(n) _____ check is paid directly from a checking account via the Internet.

electronic

_____ is a digital or virtual currency that uses cryptography for security, making it difficult to counterfeit.

electronic check

The check routing symbol is commonly _____ on a personal check.

hyphenated

All checks received in the office, whether in person or through the mail, should be protected by endorsement:

immediately at the time received

Which of the following is not included in the company details on an invoice?

invoice number

The study and analysis of financial data as it applies to operational issues within a company is called _____ accounting.

managerial

The process of performing banking transactions with a smart phone or personal digital assistant (PDA) is known as _____ banking.

mobile

To convert the gross collection ratio to a percentage, you:

multiply it by 100

The _____ ratio is also known as the adjustment collection ratio.

net collection

The ______ demonstrates the value of a business.

net worth

Accept a check that has not corrections made

not a best practice (not a good policy)

Accept a check that has seven components that make it valid

not a best practice (not a good policy)

Accept a check written for more than the amount due so patient can receive cash back

not a best practice (not a good policy)

Accept a third-party check

not a best practice (not a good policy)

The _____ is the amount in numbers that the check is written for.

numeric amount

A check must include some form of which phrase to be negotiable?

pay to the order of

Which of the following is not commonly considered an overhead expense?

payroll

A check paid directly from a checking account through the Internet is known as a(n):

personal checking

As soon as cash money is received in the office, it should be:

placed out of sight in a secure location

When sorting currency, bill should be stacked:

portrait side up, in order from highest to lowest denomination

Which of the following is not a type of savings account?

possible loss of funds, identity of patients, potential HIPAA violations

A business that accepts credit cards gives customers another payment option.

pro

Because the debit process is similar to a cash transaction, the fees that a business pays on debit transaction are smaller than credit card or check fees.

pro

Easy to use and makes paying bills or making store purchases hassle free for customers.

pro

Payments generally have a faster approval time, which means faster access to revenue.

pro

Precautions must be taken when determining the banking procedures within a practice. Which of the following is an example of banking concerns?

pro

the process of verifying that the amounts on the bank statement are consistent with the amounts in the check register is known as:

reconciling

If a stop payment is placed on a check, the bank will:

refuse to honor the check

A _____ endorsement states, "PAY TO THE ORDER OF (name of bank where the check is to be deposited)."

restrictive

When depositing checks by mails, they should be endorsed by _____ endorsement only.

restrictive

The MICR numbers are numbers and symbols and contain the nine-digit _____ number.

routing

A _____ check is a check presented too long after it was written to be honored by the bank.

stale

A check will be instantly returned by the bank if:

the signature is missing

When preparing a deposit slip, if there are more checks than can be listed in the front of the slip, you should:

use the back, total the amount, and bring it forward to the correct line

A medical assistant working in accounts payable should:

verify that everything on the invoice was received before making payment

When a statement is received from a supplier, you should:

verify that everything on the invoice was received before making payment

This kind of check is often used by insurance companies:

voucher

You should not accept a check that is:

written for more than the amount due so the patient can have some cash in hand