Multiple Choice (20 points) 1. The principles of internal control include: A. Maintain minimal records. B. Use only computerized systems. c. Establish responsibilities. D. Bond all employees. E. Require automated sales systems. 2. A properly designed internal control system: A. Insures profitable operations. B. Eliminates the need for an audit. C. Lowers the company's risk of loss. D. Requires the use of non-computerized systems. E. Is not necessary if the company uses a computerized system. 3. Preparing a bank reconciliation on a monthly basis is an example of: A. Establishing responsibility. B. Separation of duties. C.A technological control. D. Poor internal control. E. Protecting assets by proving accuracy of cash records. 4. When a petty cash fund is in use: A. Expenses paid with petty cash are recorded when the fund is replenished. B. Petty Cash is debited when funds are replenished. c. Petty Cash is credited when funds are replenished. D. Expenses are not recorded. E. Cash is debited when funds are replenished 5. A check that was outstanding on last period's bank reconciliation was not among the cancelled checks returned by the bank this period. As a result, in preparing this period's reconciliation, the amount of this check should be: A. Added to the book balance of cash. B. Deducted from the bank balance of cash. c. Deducted from the book balance of cash. D.Added to the bank balance of cash. E. Ignored in preparing the period's bank reconciliation. 1 | Page