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5 Written questions

5 Matching questions

  1. A local gas station has one clerk that accepts cash payments for gas and rings them up on the cash register. Which of the following would be the best control to provide assurance that the cashier isn't keeping some of the cash?A-Count all cash before and after the shift and compare it to cash register totals.B-Require that each customer be given a receipt of their purchase.C-Compare cash register totals to a total that is automatically generated by each gas pump.D-Require that each employees have a separate cash drawer that only they use.
  2. To gather evidence regarding the balance per bank on a bank reconciliation, an auditor could examine all of the following except: A-Cutoff bank statement. B-Year-end bank statement. C-Bank confirmation. D-General ledger.
  3. What of the following is the risk that is of most concern to auditors when auditing cash?A-Detective risk B-Inherent risk C-Adjunct risk D-Nonsampling risk
  4. Voucher (386)
  5. Which of the following is most likely to indicate fraud? A-Several overpayments are made for goods received from a supplier. B-The year end cash balance does not include cash in transit to the company at year-end. C-A check received after year end was inadvertently recorded as if received before year-end. D-A documented loan to an officer of the company
  1. a D-General ledger.
  2. b B-Inherent risk
  3. c ...
  4. d C-Compare cash register totals to a total that is automatically generated by each gas pump.
  5. e A-Several overpayments are made for goods received from a supplier.

5 Multiple choice questions

  1. C-The Controller should have control of accounting functions and the Treasurer should have control of cash receipt functions.
  2. D-Examine the voided checks file to determine whether the check is in the file.
  3. A-An unrecorded (on the books) deposit made at the beginning of the month; the amount was withdrawn late in the month, again with no book entry.
  4. Financial instruments that "derive" their value from other financial instruments, underlying assets, or indexes. Examples are options, forward contracts, and futures contracts.
  5. D-Valuation

5 True/False questions

  1. A company owns a large amount of debt securities that pay interest twice a year - August 1 and February 1. On the financial statements the company accrued the 5 months of interest it was due as interest receivable. The auditor should: A-Require the accrual be reversed since the interest has not yet been paid. B-Confirm the interest accrual with the security issuer. C-Require the accrual be reversed since the company could sell the security before interest has been paid. D-Verify the company owns the security, check the accuracy of the accrual, and require no adjustment.D-Valuation

          

  2. Broker's advice (410)A notification sent by a stockbrokerage firm to a customer reporting the terms of a purchase or sale of securities.

          

  3. Proof of Cash (399)...

          

  4. Which of the following is confirmed on the standard form used for cash balances at financial institution? A-Factored accounts receivable B-Loss contingencies C-Loans payable D-Safe deposit boxes controlled by the entityD-They may be sent electronically or non-electronically.

          

  5. Jones embezzled $50,000 from his company's account in Bank A. At year-end he hid the shortage by making a deposit on December 31 in Bank A, drawn on Bank B. He has not recorded the transaction on the books. This is an example of: A-Lapping. B-Kiting. C-Effective cash management. D-Related party transactions.B-Kiting.

          

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