Business process control plans relate to those controls particular to a specific process or subsystem, such as billing or cash receipts.
Indicate whether the statement is true or false
(
Q. 2) Match the following terms with the appropriate definitions below. Some terms are used more than once.
a. Accrued revenue
b. Accrued expense
c. Deferred revenue
d. Deferred expense
_____ 1. An end of period adjustment to recognize office supplies used during a period
_____ 2. An end of period adjustment to recognize employee salaries earned but unpaid
_____ 3. An end of period adjustment to recognize depreciation on certain long-term assets
_____ 4. An end of period adjustment to recognize prepaid insurance used up during a period
_____ 5. An end of period adjustment to recognize prepaid rent used up during a period
_____ 6. An end of period adjustment to recognize interest costs incurred but unpaid
_____ 7. An end of period adjustment to recognize earnings related to work done but not yet billed
_____ 8. An end of period adjustment to recognize the amount of unearned revenue earned as of the end of the period
(
Q. 3) If the cash short and over account has a credit balance at the end of the fiscal year, the balance represents an expense or loss.
a. True
b. False
Indicate whether the statement is true or false
(
Q. 4) Only Internal Revenue Service (IRS) agents may conduct audits of financial statements.
Indicate whether the statement is true or false
(
Q. 5) A sales invoice included the following information: merchandise price, 12,000; terms 1/10, n/eom, FOB shipping point with prepaid freight of 900 added to the invoice. Assuming that a credit for merchandise returned of 500 is granted prior to payment and that the invoice is paid within the discount period, what is the amount of cash that should be received by the seller?
a. 12,285
b. 11,500
c. 10,480
d. 11,385
(
Q. 6) On July 1, Team Shirts paid 600 for three months' worth of advertising beginning on July 1. What is the balance in the Prepaid advertising account at August 31?
A) 0
B) 200
C) 400
D) 600
Quick Reply
