____ is a process that evaluates the quality of internal control performance over time.
a. Control environment
b. Risk assessment
c. Control activities
d. Monitoring
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Q. 2) Indicate with an X whether each item is an asset, liability or shareholders' equity account. There is only one correct answer for each.
Item: Asset Liability Shareholders' equity
1. Dividends
2. Accounts receivable
3. Contributed capital
4. Note payable
5. Wages expense
6. Wages payable
7. Prepaid insurance
8. Insurance expense
9. Accounts payable
10. Retained earnings
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Q. 3) The petty cash payments record indicates classified expenditures as follows: Automobile Expense, 20; Supplies Expense, 12; Postage Expense, 6; and Miscellaneous Expense, 5 . The transaction would include
a. debiting Automobile Expense.
b. crediting Supplies Expense.
c. debiting Cash.
d. crediting Accounts Payable.
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Q. 4) A purchase requisition is a document that is ________.
A) sent to a supplier or vendor requesting that an item be shipped
B) used internally to request that something be purchased
C) used internally to approve a payment for inventory
D) sent to a supplier along with payment for inventory purchased
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Q. 5) President's salaries, depreciation of office furniture, and office supplies are
a. selling expenses
b. miscellaneous expenses
c. administrative expenses
d. inventory expenses
(
Q. 6) The accountant for Midway Company is reconciling the company's cash account with the bank statement. Below is a list of items that will be included in the reconciliation.
Write the LETTER for each item as either an addition to or a subtraction from either the bank balance or the book balance.
a. Midway Company deposited 200 worth of checks that are not on the bank statement.
b. A customer's check for 118 was returned by the bank for insufficient funds.
c. There are 2,980 worth of outstanding checks.
d. The bank collected a note receivable for Midway Company worth 500.
e. The bank charged Midway Company 10 to collect the note receivable.
f. 20 of other bank service charges appears on the bank statement.
Bank Balance Book Balance
Add: Add:
Subtract: Subtract:
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