Exam 1 - Quizzes

Question 1

Which skimming scheme would have more of an audit trail?

a. Sales skimming
b. Receivables skimming

Answer 1

Receivables skimming

Question 2

Which of the following procedures would NOT be useful in preventing and detecting sales skimming schemes?

a. Comparing register tapes to the cash drawer and investigating discrepancies
b. Summarizing the net sales by employee and extracting the top employees with low sales
c. Installing video cameras at cashpoints
c. Offering discounts to customers who get receipts for their purchases

Answer 2

Offering discounts to customers who get receipts for their purchase

Question 3

A method of concealing receivables skimming by creating one account while abstracting money from a different account is known as:

a. Account substitution
b. Kiting
d. Lapping
c. Plugging

Answer 3

Lapping

Question 4

Jason Herman works part-time as a retail clerk at a local bookstore. One night while his manager was out of town, Jason decided to keep the store open for a few extra hours. He reset the cash registers at the normal closing time, but continued making sales. Two hours later, when he closed for the night, he reset the register machines, removing all evidence that any extra transactions had been made, and pocketed the money from the after-hour sales. What kind of scheme did Jason commit?

a. Register disbursement
b. Force balancing
c. Receivables skimming
d. Unrecorded sales

Answer 4

Unrecorded sales

Question 5

What is the primary difference between cash larceny and skimming?

a. Cash larceny is an on-book scheme; skimming is an off-book scheme
b. Cash larceny is an off-book scheme; skimming is an on-book scheme
c. Cash larceny is a disbursement scheme; skimming is a cash receipts scheme
d. Cash larceny involves cash only; skimming can involve either cash or checks

Answer 5

Cash larceny is an on-book scheme; skimming is an off-book scheme

Question 6

If discrepancies are found between the sales records and the cash on hand; which of the following schemes might be occurring?

a. Cash larceny at the point of sale
b. Cash larceny from the deposit
c. Fraudulent disbursements
d. Sales skimming

Answer 6

Cash larceny at the point of sale

Question 7

Danielle Boyle, CFE was hired to investigate some suspicious activity in the accounts receivable department at Red Technologies. While examining the company’s accounting records, she noticed several payments posted to customers; accounts that were later reversed with journal entries to “courtesy discounts”. What type of scheme might this situation indicate?

a. Receivables skimming
b. Deposit lapping
c. Cash larceny of receivables
d. Shell company

Answer 7

Cash larceny of receivables