Select the correct answer and fill in the correct responses:

14) Reducing expenses to increase operating profit is representative of ________.

A) safeguarding assets

B) following company policies

C) promoting operational efficiency

D) ensuring accurate, reliable accounting records

15) Which of the following is a requirement of the Sarbanes-Oxley Act?

A) An outside auditor must evaluate the client's internal controls and report on the internal controls as part of the audit report.

B) The Public Company Accounting Oversight Board must conduct audits of public companies.

C) The accounting firm that audits a public client must also provide consulting services for the same client.

D) The Public Company Accounting Oversight Board must create new accounting standards.

16) An employee of the business who ensures that the company's employees are following company policies is ________.

A) an external auditor

B) an internal auditor

C) a department manager

D) all of the above

17) Two or more people working together to circumvent internal controls and defraud a company is known as ________.

A) encryption

B) firewall

C) collusion

D) separation of duties

18) Petty cash tickets serve as ________.

A) a bank control for the account

B) a determinate for the amount of the fund

C) an authorization voucher and explanation

D) a payment receipt

19) A way to account for petty cash by maintaining a constant balance in the petty cash account and which at any time requires that cash plus petty cash tickets must total the amount allocated to the petty cash fund, is known as the ________.

A) control system

B) voucher system

C) balanced system

D) imprest system

20) A company has a petty cash fund amount of $400. When replenished, it has petty cash tickets of $33 for gas expense, $28 for postage expense, $133 for supplies expense, and $115 for miscellaneous expenses. Assume there is no shortage or overage. In the journal entry, Cash would be credited for ________.

A) $309

B) $91

C) $63

D) $337

21) Prepare the journal entries for the following petty cash transactions of Advanced Automotive. Omit explanations.

July 1	Established a petty cash fund with a $400 balance.
July 31	The petty cash fund has $240 in cash and $150 in petty cash tickets that were issued to pay for Office Expense ($70) and Repair Expense ($80). Replenished the fund and recorded the expenditures.
Aug. 16	Increased the balance of the petty cash fund to $450.

General Journal
Date	Accounts	Debit	Credit

22) The bank statement shows the June bank balance of $12,000. The Cash account has a balance of $13,500 on June Other items affecting the bank reconciliation during Juneinclude:

Deposit in transit	$1,200
EFT receipt for customer (collection on account)	500
NSF Check	2,450
Outstanding Check #706	1,100
Outstanding Check #711	600
Interest Revenue on bank balance	110
Bank service charge	40
EFT payment of water bill	120

Given the above information, prepare the bank reconciliation for June and journalize all of the entries needed to bring the Cash account up to date. Omit explanations.

BANK RECONCILIATION:

Bank Reconciliation
BANK:
BOOK:

JOURNAL ENTRIES:

General Journal
Date	Accounts	Debit	Credit