Which of the following is true of a petty cash voucher? a.It must be issued once in a month by a bank. b.It must explain the purpose of the payment. c.It must only be used to account for payments of more than $5. d.It must be signed only by the person who authorized the payment.
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- Payment by check is an important internal control over cash payments because a. the check must be signed by an authorized official. b. before signing the check, the official reviews the invoice supporting the payment. c. Both a and b d. None of the aboveWhich of the following are important elements of a cash disbursement control system? Note: Select all that apply. Check All That Apply All expenditures are authorized before a check is prepared. Checks are signed only by authorized Individuals. The bank-generated deposit slip should be compared with the check listing. The person opening the mall is not the person who maintains the accounting records. Unauthorized payments are prevented.For proper segregation of duties in cash disbursements, the person who signs checks also a. reviews the monthly bank reconciliation b. is denied access to the supporting documents c. returns the cheques to accounts payable d. is responsible for mailing the cheques
- Read the following statements about internal controls. Write down the number of each statement and whether the statement is true or false. If a statement is false, explain why. the hysical stockta 1. Internal controls are not required when payments are made by cheque. 2. All payments should be made by cheque, except for petty cash payments. A good internal control procedure is where the same person is responsible ed with the e reported for paying all accounts, writing all cheques and signing all cheques. 4. In order to be efficient, all employees should have direct access to 3. and loss. petty cash. Bank reconciliation statements need only be drawn up every six months. 1) diately. 7. A blank cheque can be signed to replenish the petty cash fund if it is handed to the custodian. 5. 6. Cheque books should be kept in a locked safe as a preventive control. 9. Separation of duties is a vital part of internal control procedures. 10. Any employee of a business should be able to buy assets for…Which of the following is an internal control that will prevent paid cash disbursementdocuments from being presented for payment a second time?(1) The date on cash disbursement documents must be within a few days of the datethat the document is presented for payment.(2) The official signing the check compares the check with the documents and shoulddeface the documents.(3) Unsigned checks are prepared by individuals who are responsible for signing checks.(4) Cash disbursement documents are approved by at least two responsible management officialsPayment by check is an important internal control over cash payments because the check must be signed by an authorized official. before signing the check, the official reviews the invoice supporting the payment. Both a and b None of the above
- Which of the following statements about a forged drawer's signature on a check is true? a.) A payor bank that pays on a forged signature of the drawer can charge the drawer's account b.) A payor bank paying on the forged signature of an endorser does not need to return the instrument to the party whose name was forged c.) In the event of the forged signature of the drawer, the bank can collect from the party receiving the payment unless the party is the forger or the party dealt with the forger negligently d.) A payor bank that pays on a forged endorsement can collect from the person to whom payment was madeWhich of the following controls would best prevent the lapping of accounts receivable?a. Segregate duties so that the clerk responsible for recording in the accounts receivable subsidiary ledger has no access to the general ledger.b. Request that customers review their monthly statements and report any unrecorded cash payments.c. Require customers to send payments directly to the company’s bank.d. Request that customers make checks payableto the company.Which of the following controls will help prevent skimming? a. The accounts receivable bookkeeper’s duties are separated from preparing the bank deposit b. The accounts receivable bookkeeper has access to collections from customers. c. The accounts receivable bookkeeper is responsible for preparing the bank deposit. d. The accounts receivable bookkeeper makes all entries in the cash receipts book.
- Which is not a key element of internal control over cash receipts? a. daily recording of all cash receipts in the accounting records b. daily entry in a voucher register c. immediate counting by the person opening the mail or using the cash register. d. daily deposit intactTrue or False. 9. An NSF check is a reconciling item that does not require an adjusting entry in the books of the depositor.10. Adjusting journal entries are prepared based on the reconciling items on the bank side of the bank reconciliation.11. A bank statement is prepared by the depositor to reconcile the difference between his records and bank records.When a petty cash fund is used, which of the following is true? * A. The petty cashier’s summary of petty cash payments serves as a journal entry that is posted to the appropriate general ledger account. B. The reimbursement of the petty cash fund should be credited to the cash account. C. Entries that include a credit to the cash account should be recorded at the time that payments from the petty cash fund are made. D. The balance of the petty cash fund should be reported in the statement of financial position as a long-term investment.