acc unit 2 Flashcards
Which of the following is NOT an internal control activity for cash?
Recordkeeping and physical custody of cash should be performed by the same person
A traditional definition of internal control specifically includes all of the following except
maintenance of a clean and safe work place
Jane manages the physical inventory in the warehouse and also the accounting records. what is being violated
segregation of duties
all of the following are inventory costing methods except
periodic
when applying the lower- of cost- or- market rule to inventory valuation, market means
replacement cost
the lower-cost- or market method of accounting for inventories follows the convention of
conservatism
in a period of rising prices, which inventory method is best to use to reduce income taxes by reducing net income?
LIFO
the interest on a 3 month, 12% , $6,000 note receivable is
180
when the FIFO method is used ending inventory is assumed to consist of
most recently purchased
under the perpetual inventory system, in addition to making the entry to record a sale, a company would
increase cost of goods sold and decrease merchandise inventory
what does not represent a sale
merchandise that is placed aside for a customer to pick up later
the collection of a $400 account within the 2% discount period would result in
increase to sales discount for $8
if a company erroneously records a $500 deposit as a $50 in its records, what must occur when reconciling its bank rec
the company must increase the balance per its records by $450
what would be deducted from the balance per bank
outstanding checks
on a bank rec, interest earned on a checking account should
added to the balance per books
which of the following items on a bank rec would require a journal entry?
a bank service charge
the account Allowance for Uncollectible Accounts is classified as
contra account to ACC Recievable
the matching rule related to credit losses by stating that Bad Debt expense should be recorded
in the same time as revenue is
merchandise inventory becomes part of costs of goods sold when a company
sells the inventory
under the allowance method, the entry to write off a $1,425 uncollectable account includes
a debit to allowance for doubtful accounts for $1425
the collection of a $1,000 account after the 2% discount ends would result in
decrease to Acc Receivable for $1,000
Which internal control activity is followed when inventory storage areas are secured with limited access?
Safe quaking of assets and records
Which of the following journal entries is recorded as a result of the bank rec process to record an NSF check
ACC REC 250
Cash 250
what approach for the allowance procedure emphesizes matching bad debt expense with rev on the IS
the % of net credit sales approach
what statement is true regarding the 2 allowance procedures used to estimate bad debt?
The aging of acc receivable method
which of the following is not included in cash and cash equivalents on BS
a bank certificate of deposit for a year
