Chapter 7 dsm

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Columbus State Community College *

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1211

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Accounting

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Apr 3, 2024

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Chapter 7 dsm 1. The journal entry to set up a Petty Cash Fund for $500 to pay incoming delivery expenses would be: YOU WERE SURE AND CORRECT Dat e Account s Deb it Cred it Petty Cash 500 Cash 500 2. Abbott Company completed the bank reconciliation and needs to record the $30 service charge from the bank. The journal entry to record this transaction would be: YOU WERE SURE AND CORRECT Dat e Accounts Deb it Cred it Bank Expense 30 Cash 30 3. The controller compares the bank deposit to the journal entry for cash receipts to ensure that the bank deposit matches the accounting records for the _________ account. Cash 4. After approving all documents from a shipment received, the __________ sends a check to the vendor. The purchaser 5. For each Petty Cash payment, the custodian of the account prepares a(n) Petty cash ticket 6. The following was paid out of the Petty Cash account: $400 for Store Supplies $200 for Postage Expense After counting the cash that is left in Petty Cash, $560 is needed to replenish the Petty Cash back to the original balance. The journal entry to record the replenishing of Petty Cash would be: Dat e Accounts Deb it Credi t Store Supplies 400

Postage Expense 200 Cash Short & Over 40 Cash 560 7. The following was paid out of the Petty Cash account: $200 for Office Supplies $100 for Delivery Expense $300 is needed to replenish the Petty Cash back to the original balance. The journal entry to record the replenishing of Petty Cash would be: Dat e Accounts Deb it Cred it Office Supplies 200 Delivery Expense 100 Cash 300 8. Which of the following is NOT a part of the definition of internal control? encourage employees to change the company policies 9. To increase the amount in the current Petty Cash fund from $1,000 to $1,200, the journal entry would be: Dat e Account s Deb it Cred it Petty Cash 200 Cash 200 10. Which of the following is added to the bank balance in a bank reconciliation? Deposits in transit 11. Shady Mills Company Cash account shows an ending balance of $1,200. The bank statement shows an ending balance of $770. Additional information includes: $30 Service charge $300 Deposit in transit $50 Outstanding checks What is the adjusted bank balance?

ENDING BALANCE+DEPOSIT -SERVICE CHARGE = 1.020 12. A company accepts VISA credit cards and incurs a 4% processing fee for each sale made to a customer using a credit card. Which of the following journal entries would record a $1,000 sale to a customer who uses their VISA card? Cash 960 (debit) Credit Card Expense 40 (debit) Sales Revenue 1,000 (credit) 13. The Sarbanes-Oxley Act requires companies to ________. conduct a review of internal controls and take responsibility for the accuracy and completeness of their financials reports 14. When an order is placed for merchandise, the purchaser sends a(n) ________ to the vendor. Purchase order 15. Abbott Company completed the bank reconciliation and needs to record the $10 earned in interest from the bank balance. The journal entry to record this transaction would be: Dat e Accounts Deb it Credi t Cash 10 Interest Revenue 10 16. Which of the following would be added to the book balance in a bank reconciliation? Interest revenue 17. The ________ uses the remittance advices to record the journal entries to Cash and customer accounts . accounting department (or bookkeeper) 18. Tango Company Cash account shows an ending balance of $1,500. The bank statement shows an ending balance of $790. Additional information includes:

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$150 Service charge $400 Deposit in transit $50 Outstanding checks What is the adjusted bank balance? Ending balance +deposit transit -outstanding checks= 1140 19. The following was paid out of the Petty Cash account: $200 for Office Supplies $100 for Delivery Expense After counting the cash that is left in Petty Cash, $320 is needed to replenish the Petty Cash back to the original balance. The journal entry to record the replenishing of Petty Cash would be: Dat e Accounts Deb it Cred it Office Supplies 200 Delivery Expense 100 Cash Short & Over 20 Cash 320 20. Which of the following is NOT a component of internal control? Audits 21. Which of the following is subtracted from the book balance in a bank reconciliation? Banck charges 22. Cryptocurrency: *is an accepted form of payment by some companies *Work on a blockchain *is a medium of exchange. *is not legal tender 21. Shady Mills Company Cash account shows an ending balance of $1,000. The bank statement shows an ending balance of $680. Additional information includes: $30 Service charge $300 Deposit in transit

$10 Interest earned on bank balance What is the adjusted book balance? $980