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Introduction to Financial Accounting International 8th Edition by Curtis L Norton Gary A Porter-Test Bank

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  • ISBN-10 ‏ : ‎ 8131519783
  • ISBN-13 ‏ : ‎ 978-8131519783

Original price was: $80.00.Current price is: $28.00.

SKU:tb1002582

Introduction to Financial Accounting International 8th Edition by Curtis L Norton Gary A Porter-Test Bank

Chapter 6: Cash and Internal Control

MULTIPLE CHOICE

1. Among the assets listed below, which one is considered the most liquid?
a. Cash
b. Accounts receivable
c. Merchandise inventory
d. Prepaid expenses

ANS: A PTS: 1 DIF: Difficulty: Easy
REF: pp. 306-308 OBJ: LO: 06-01 NAT: BUSPROG: Communication
STA: AICPA: FN-Reporting |ACBSP: APC-10-Internal Control
KEY: Bloom’s: Application

2. Which one of the following items is not included in cash?
a. A bank certificate of deposit for one year
b. A savings account at the bank
c. A checking account at the bank
d. All of the above are included in cash

ANS: A PTS: 1 DIF: Difficulty: Moderate
REF: pp. 306-308 OBJ: LO: 06-01 NAT: BUSPROG: Communication
STA: AICPA: FN-Reporting |ACBSP: APC-10-Internal Control
KEY: Bloom’s: Comprehension

3. Which one of the following is not considered to be a cash equivalent?
a. Corporate commercial paper due in 90 days after purchase
b. U.S. Treasury bills with an original maturity of six months
c. A money market account with a stock brokerage firm
d. A certificate of deposit with a term of 75 days when acquired

ANS: B PTS: 1 DIF: Difficulty: Moderate
REF: pp. 306-308 OBJ: LO: 06-01 NAT: BUSPROG: Communication
STA: AICPA: FN-Reporting |ACBSP: APC-10-Internal Control
KEY: Bloom’s: Comprehension

4. How are cash equivalents reported or disclosed in the financial statements?
a. They appear only on the statement of cash flows
b. They are included with short-term investments under current assets on the balance sheet.
c. They are included with cash under current assets on the balance sheet.
d. They are disclosed only in a footnote to the balance sheet.

ANS: C PTS: 1 DIF: Difficulty: Moderate
REF: pp. 306-308 OBJ: LO: 06-01 NAT: BUSPROG: Communication
STA: AICPA: FN-Reporting |ACBSP: APC-10-Internal Control
KEY: Bloom’s: Comprehension

5. Which one of the following could never be considered to be cash equivalents?
a. Common stock issued by a corporation
b. Money market funds
c. Corporate commercial paper
d. U. S. Treasury bills

ANS: A PTS: 1 DIF: Difficulty: Moderate
REF: pp. 306-308 OBJ: LO: 06-01 NAT: BUSPROG: Communication
STA: AICPA: FN-Reporting |ACBSP: APC-10-Internal Control
KEY: Bloom’s: Comprehension

6. Which one of the following is not a cash equivalent?
a. 30-day certificate of deposit
b. 60-day commercial paper
c. 90-day U. S. treasury bill
d. 180-day note issued by a local or state government

ANS: D PTS: 1 DIF: Difficulty: Easy
REF: pp. 306-308 OBJ: LO: 06-01 NAT: BUSPROG: Communication
STA: AICPA: FN-Reporting |ACBSP: APC-10-Internal Control
KEY: Bloom’s: Comprehension

7. Effective cash management and control includes all of the following except
a. The use of a petty cash fund
b. Bank reconciliations
c. Short-term investments of excess cash
d. Purchase of stocks and bonds

ANS: D PTS: 1 DIF: Difficulty: Easy
REF: pp. 309-316 OBJ: LO: 06-02 NAT: BUSPROG: Communication
STA: AICPA: FN-Reporting |ACBSP: APC-10-Internal Control
KEY: Bloom’s: Comprehension

8. Checks presented for payment and paid by the bank are known as
a. Canceled checks
b. Certified checks
c. NSF checks
d. Outstanding checks

ANS: A PTS: 1 DIF: Difficulty: Moderate
REF: pp. 309-316 OBJ: LO: 06-02 NAT: BUSPROG: Communication
STA: AICPA: FN-Reporting |ACBSP: APC-10-Internal Control
KEY: Bloom’s: Knowledge

 

 

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