Accounting-Chapter 5
false
Most banks do not look at the date the check is written and will withdraw money from the depositor's account anytime
false
When a deposit is made in a bank account, the bank issues a check
false
When the petty cash fund is replenished, the balance of the petty cash account increases
false
When writing a check, the first step is to prepare the check
true
An important aspect of cash control is verifying that the information on a bank statement and in a checkbook are in agreement
false
An outstanding check is one that has not yet been issued
true
Banks deduct service charges from customers' checking accounts without requiring customers to write a check for the amount
checking account
A bank account from which payments can be ordered by a depositor.
debit card
A bank card that automatically deducts the amount of a purchase from the checking account of the cardholder
debit card
A bank card that automatically deducts the amount of a purchase from the checking account of the cardholder.
deposit slip
A bank form which lists the checks, currency, and coins an account holder is adding to a bank account
deposit slip
A bank form which lists the checks, currency, and coins an account holder is adding to the bank account.
NSF check
A check dishonored by the bank because of insufficient funds in the account of the maker of the check
dishonored check
A check that a bank refuses to pay
voided check
A check that cannot be processed because the maker has made it invalid
voided check
A check that cannot be processed because the maker has made it invalid.
fasle
A check that contains minor errors can be corrected neatly and initialed
canceled check
A check which has been paid by the bank
true
A check with a blank endorsement can be cashed by anyone who has possession of the check
postdated check
A check with a future date on it
postdated check
A check with a future date on it.
electronic funds transfer
A computerized cash payments system that transfers funds without the use of checks, currency, or other paper documents
petty cash slip
A form showing proof of a petty cash payment
false
A memorandum is the source document for the entry to record replenishing the petty cash fund
cash short
A petty cash on hand amount that is less than a recorded amount
cash short
A petty cash on hand amount that is less than the recorded amount.
cash over
A petty cash on hand amount that is more than a recorded amount
cash over
A petty cash on hand amount that is more than the recorded amount.
false
A petty cash report is completed at the end of each business day
bank statement
A report of deposits, withdrawals, and bank balances sent to a depositor by a bank
bank statement
A report of deposits, withdrawals, and bank balances sent to a depositor by a bank.
endorsement
A signature or stamp on the back of a check transferring ownership.
endorsement
A signature or stamp on the back of a check, transferring ownership
accounting clerk
An accounting worker who processes routine details about accounting transactions.
petty cash
An amount of cash kept on hand and used for making small payments
blank endorsement
An endorsement consisting only of the endorser's signature
blank endorsement
An endorsement consisting only of the endorser's signature.
special endorsement
An endorsement indicating a new owner of a check
special endorsement
An endorsement indicating a new owner of a check.
restrictive endorsement
An endorsement restricting further transfer of a check's ownership.
true
Because cash transactions occur more frequently than other transactions, there is more chance for making recording errors affecting cash
true
Businesses use petty cash when writing a check is neither time nor cost effective
true
Not only do banks charge a fee for handling a dishonored check, but they also deduct the amount of the check from the account
true
The amount of a check is written twice on each check
true
The journal entry for a payment on account using electronic funds transfer is exactly the same as when the payment is made by debit card
true
The purpose of a petty cash fund is to make small cash payments without writing checks
true
The source document for a debit card purchase is a memorandum
fasle
The source document for an electronic funds transfer is a check number
true
There are three types of endorsements commonly used: blank, special, and restrictive