Multiple Choice Questions
1. All of the following are objectives of internal control except
a. To comply with legal requirements.
b. To maximize net income.
c. To ensure accurate and reliable accounting records.
d. To safeguard assets.
2. All of the following are internal control procedures except
a. Sarbanes-Oxley reforms.
b. Electronic devices.
c. Assignment of responsibilities.
d. Internal and external audits.
3. Requiring that an employee with no access to cash do the accounting is an example of which characteristic of internal control?
a. Assignment of responsibility
b. Competent and reliable personnel
c. Monitoring of controls
d. Separation of duties
4. All of the following are controls for cash received over the counter except
a. The cash drawer should open only when the salesclerk enters an amount on the keys.
b. A printed receipt must be given to the customer.
c. The customer should be able to see the amounts entered into the cash register.
d. The sales clerk must have access to the cash register tape.
5. In a bank reconciliation, an outstanding check is
a. Deducted from the book balance.
b. Added to the bank balance.
c. Added to the book balance.
d. Deducted from the bank balance.
6. In a bank reconciliation, a bank collection of a note receivable is
a. Deducted from the bank balance.
b. Added to the book balance.
c. Added to the bank balance.
d. Deducted from the book balance.