The correct order of accounting steps is I.set policies, record, post, adjust II.record, adjust,...
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Transcript of The correct order of accounting steps is I.set policies, record, post, adjust II.record, adjust,...
![Page 1: The correct order of accounting steps is I.set policies, record, post, adjust II.record, adjust, post, set policies III.record, post, set policies, adjust.](https://reader036.fdocuments.net/reader036/viewer/2022062619/5516e247550346f5558b458c/html5/thumbnails/1.jpg)
The correct order of accounting steps is
1) 2) 3) 4)
25% 25%25%25%I. set policies, record, post, adjust
II. record, adjust, post, set policies
III. record, post, set policies, adjust
IV. post, record, adjust, set policies
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In many manufacturing companies the first record in the record-keeping process is
1) 2) 3) 4)
25% 25%25%25%I. a process order
II. an invoice
III. a work order
IV. a purchase order
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In order to obtain the raw materials needed to complete the manufacturing process the
company issues
1) 2) 3) 4)
25% 25%25%25%I. a process order
II. an invoice
III. a work order
IV. a purchase order
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Companies tie purchase and payable records to
1) 2) 3) 4)
25% 25%25%25%I. cheques received from suppliers
II. cheques written to suppliers
III. invoices sent to customers
IV. transfers between departments within the company
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Cash receipts complete the cycle
1) 2) 3) 4)
25% 25%25%25%I. order, payment, purchase, sale, collection
II. purchase, order, payment, sale, collection
III. sale,order, purchase, payment, collection
IV. order, purchase, payment, sale, collection
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A medium of value which plays a relatively declining role in the receipt of payments is
1) 2) 3) 4)
25% 25%25%25%I. “hard cash” in the form of coins and banknotes
II. credit cards
III. direct debit
IV. EFT
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Company documents that act as backups to the accounting system are
1) 2) 3) 4)
25% 25%25%25%I. (apart from company logos and addresses), completely standardised across the entire economy
II. standardised across industry
III. standardised by province
IV. not standardised by any of the above.
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Accounting transactions are recorded
1) 2) 3) 4)
25% 25%25%25%I. on the orders of the chief accountant
II. on the basis of source documents
III. on the basis of economic policies
IV. on the basis of tax law
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Internal control is the responsibility of the business’
1) 2) 3) 4)
25% 25%25%25%I. owners
II. managers
III. auditors
IV. regulators
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When the financial scandal broke at WorldCom, a central issue was the CFO's
1) 2) 3) 4)
25% 25%25%25%I. competence
II. intelligence
III. ethics
IV. employee motivation policies
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Rupert Inc. is concerned about theft in its warehouse, currently estimated at $4,000 per year. The company's chief security officer
proposes that the warehouse be fitted with security cameras and that two extra full-time security guards be employed. This is an example of
1) 2) 3) 4)
25% 25%25%25%I. an effective and efficient control system
II. an ineffective but efficient control system
III. an effective but inefficient control system
IV. an ineffective and inefficient control system
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Separation of functions is
1) 2) 3) 4)
25% 25%25%25%I. an effective but possibly costly method of preventing fraud
II. an efficient way to encourage fraud
III. an ineffective but efficient way of preventing fraud
IV. none of the above
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Accrual accounting
1) 2) 3) 4)
25% 25%25%25%I. is unrelated to internal control issues
II. provides very useful non-cash control accounts
III. can assist fraudsters because it obscures the true cash position
IV. makes it easy to forget slow-paying customers
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Malcolm Inc. pays its employees gross wages $500 per week and deducts $125 on taxes, pension payments, etc.
The effect of the deductions is to
1) 2) 3) 4)
25% 25%25%25%I. increase the company's expenses by $125 per employee
II. reduce the company's expenses by $125 per employee
III. leave the company's expenses per employee unchanged
IV. have some other effect on company expenses
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Sales taxes are
1) 2) 3) 4)
25% 25%25%25%I. a company expense
II. a company benefit
III. reflected in the company's accounting records but not in its financial statements
IV. recorded as remittances due to the company
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Azkamp Ltd., a toymaker, discovers that its new "Singing Lumberjack" line is not selling well. The CFO decides that the market value of the inventory is $96,000 lower than its book value. The accounting entry to reflect this situation is
1) 2) 3) 4)
25% 25%25%25%I. Debit Sales Revenue $96,000 Credit Inventory $96,000
II. Debit Inventory $96,000 Credit Expenses $96,000
III. Debit Expenses $96,000 Credit Inventory $96,000
IV. no entry is needed
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Accumulated amortization is
1) 2) 3) 4)
25% 25%25%25%I. the amount of cash saved up to replace the asset when it is worn out
II. the expense of operating the asset over the course of its life
III. a provision for the maintenance of the asset over its lifetime
IV. none of the above
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Doubtful accounts receivable are normally estimated
1) 2) 3) 4)
25% 25%25%25%I. in the period after they become bad debts
II. in the period before they become bad debts
III. in the same period in which they become bad debts
IV. in most cases it is impossible to make estimates of doubtful accounts receivable
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Perpetual inventories are written up
1) 2) 3) 4)
25% 25%25%25%I. only at the start of an accounting period
II. only at the end of the accounting period
III. continuously through the accounting period
IV. only when goods are sold
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Mouse Ltd receives $4,000 worth of goods for resale. The company's inventory account
will
1) 2) 3) 4)
25% 25%25%25%I. record the event only if it uses
a perpetual inventory system
II. record the event whether it uses a perpetual or a periodic system
III. record the event only if it uses a periodic inventory system
IV. wait until the goods are sold before recording anything
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Mouse Ltd sells $4,000 worth of goods for $7,500. The company's inventory account
will
1) 2) 3) 4)
25% 25%25%25%I. record the event only if it uses
a perpetual inventory system
II. record the event whether it uses a perpetual or a periodic system
III. record the event only if it uses a periodic inventory system
IV. wait until the goods are reordered before recording anything