The bank reconciliation
a. should be prepared by an employee who records cash transactions
b. is part of the internal control system
c. is for information purposes only
d. is sent to the bank for verification
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Q. 2) The Financial Accounting Standards Board prefers that companies use the indirect method of reporting cash from operating activities.
Indicate whether the statement is true or false
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Q. 3) A facility usually comprised of air-conditioned space with a raised floor, telephone connections, and computer ports, into which a subscriber can move equipment, is called a(n) _____________________________
_.
Fill in the blank(s) with correct word
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Q. 4) The preparation of the statement of cash flows using the indirect method involves the conversion from the accrual basis to the cash basis.
Indicate whether the statement is true or false
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Q. 5) After posting is completed in the accounts receivable ledger and the general ledger, the total of the accounts receivable ledger balances should equal the
a. accounts payable account balance.
b. accounts receivable account balance.
c. cash account balance.
d. net income amount.
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Q. 6) A bank reconciliation should be prepared periodically because
a. the company's records and the bank's records are in agreement
b. the bank has not recorded all of its transactions
c. any differences between the company's records and the bank's records should be determined, and any errorsmade by either party should be discovered and corrected
d. the bank must make sure that its records are correct
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