chapter 4 principles of financial accounting
The ending balance in cash is reported in which financial statement
The balance sheet and statement of cash flows
what would cause a bank statement not to agree with the cash balance in the accounting records?
The bank paid interest that the company has not recorded. The bank made an error in recording a deposit made by the company deposits outstanding that have been recorded on the company's records, but not the banks The company's made an error in recording a deposit
list the steps for a bank reconciliation in the correct order
adjust banks cash balance. adjust companies cash balance. update the company's cash account by recording items identified in the previous step
which of the following steps are necessary to reconcile the bank balance and the cash account balance
adjust banks cash balance. record items that reconcile the company's cash balance. adjust the company's cash balance
Margot, a perspective investor, wants to know how much cash ziegler inc. has on December 31st. Margot can find the information in ziegler's
balance sheet statement of cash flows
when adjusting the company's cash account balance in the bank reconciliation which item must be added to the cash account balance?
collections of funds by the bank
the sarbanes-oxley act applies to
companies that are required to file with the SEC
lindell sells $100 of goods to a customer. The customer pays with a personal check. recording this transaction will include a
debit to cash
cash receipts that have been recorded in the company's accounting records but are not yet recorded by the banks are
deposits outstanding
The two types of control procedures are preventative and ____
detective
true or false: The entry for a sale to customers is different depending on whether the customer pays with cash or check
false
The company's plans to safeguard company assets and enhance the reliability and accuracy of accounting information are referred to as
internal controls
the acronym NSF stands for
non-sufficient funds
which of the following items will require a journal entry following a bank reconciliation
notes collected by the bank NSF checks
the use of one's occupation for personal enrichment through the deliberate misuse or misapplication of the employer's resources is called
occupational fraud
The amount of cash on hand to pay for minor purchases is commonly referred to as a(n) _____ _____ fund.
petty cash
two types of control activities are
preventive and detective controls
one of the most important internal controls for cash is the bank
reconciliation
preparation of a bank_____ helps maintain control of cash accounts
reconciliation
which of the following are errors and accounting for cash
recording a cash collection $4,000 but depositing $3,000 into the bank. The bank processing a check for $210 as $120 recording a check for $168 $486 in the cash account
a bank statement may not agree with the amount of cash recorded by the company in the cash account because of _____ differences and errors
timing
a(n) ____ difference in cash occurs when a company records a transaction either before or after the bank records the same transaction
timing
if a company records a transaction before the bank records the same transaction, this is called a/an ____ difference
timing
a non-sufficient funds check requiring an adjustment to the cash balance was written:
to the company preparing the bank reconciliation
what would cause a bank statement not to agree with the cash balance in the accounting records?
The bank paid interest that the company has not recorded. The bank made an error in recording a deposit made by the company. deposits outstanding that have been recorded on the company's records, but not on the banks. The company made an error in recording a deposit.
what is the primary purpose of a bank reconciliation?
To ensure the bank balance per reconciliation is equal to the company balance per reconciliation
In a bank reconciliation, which of the following will require a journal entry by the company?
adjustments to the balance per books for items discovered on the bank reconciliation that were not yet recorded on the books
The asset that is most easily stolen and susceptible to fraud is
cash
The asset that is most susceptible to employee fraud is
cash
a bank reconciliation reconciles the bank statement with the company's
cash account in the balance sheet
when adjusting the company's cash account balance in a bank reconciliation, which items reduce the company's cash account balance
charges for NSF checks service charges
cash disbursements that have been recorded in the company's accounting records but are not yet recorded by the bank are called
checks outstanding
when a person intentionally deceives another person or company for personal gain this is referred to as
fraud
internal control consists of plans to
safeguard company assets and provide accurate and reliable accounting information
the public company accounting reform and investor protection act of 2002 is known as
sarbanes-oxley act
The petty cash fund is used for
small amounts of cash needed for low-cost items
Smith's operating cash flows in millions were $100, $150, $80 during the past 3 years; while Jones' operating cash flows in millions were $150, $115, $110 during the same period from the perspective of operating cash flows which company would likely be perceived as riskier
smith
true or false: variability in operating cash flows is unimportant as long as the total cash flows over a three-year period is sufficiently positive
false
