FAR — Financial Accounting & Reporting — Quiz 35

Questions in this quiz (10)

1. Which account is credited when replenishing a petty cash fund?

   • Cash
   • Petty Cash
   • Expense accounts
   • Accounts payable

2. Which control ensures petty cash transactions are properly documented?

   • Authorization procedures
   • Petty cash vouchers
   • Monitoring
   • Risk assessment

3. Which internal control prevents unauthorized petty cash use?

   • Segregation of duties and documentation
   • Eliminating receipts
   • Allowing unrestricted access
   • Avoiding reconciliation

4. What is the purpose of internal control over cash?

   • Eliminate all risks
   • Safeguard cash and ensure accurate reporting
   • Increase profits
   • Eliminate accounting procedures

5. Which of the following best describes accounts receivable?

   • Amounts owed to suppliers
   • Amounts owed by customers from credit sales
   • Cash received in advance
   • Long-term investments

6. Accounts receivable are typically classified as:

   • Long-term liabilities
   • Current assets
   • Equity
   • Expenses

7. Which journal entry records a credit sale of $8,000?

   • Debit Cash $8,000; Credit Revenue $8,000
   • Debit Accounts Receivable $8,000; Credit Revenue $8,000
   • Debit Revenue $8,000; Credit Accounts Receivable $8,000
   • Debit Accounts Receivable $8,000; Credit Cash $8,000

8. Which account is credited when a customer pays an outstanding balance?

   • Revenue
   • Accounts receivable
   • Cash
   • Expense

9. Which method estimates uncollectible accounts using a percentage of credit sales?

   • Direct write-off method
   • Percentage-of-sales method
   • Aging method
   • Cash basis method

10. Which method records bad debts when accounts become uncollectible?

    • Allowance method
    • Direct write-off method
    • Percentage-of-sales method
    • Aging method