QUESTION 1 Sarbanes-Oxley was passed in response to which of the following? The

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QUESTION 1

Sarbanes-Oxley was passed in response to which of the following?

The stock market crash of 2002

The savings and loan bailout

The accounting scandals of WorldCom and Enron

The mounting government deficit

QUESTION 2

In the following situation, which internal control procedure needs strengthening?
Hofstra Services hired a new accounting manager. He signed a contract for a new accounting information system,
but his position did not specify whether he was authorized to do so or not.

Assignment of responsibilities

Competent, reliable, and ethical personnel

Separation of duties

Documents

QUESTION 3

Which of the following is NOT one of the benefits provided by internal control?

To reduce waste

To insure that better business decisions are made

To offer protection against theft

To reduce inefficiency

QUESTION 4

Which of the following items found on a bank reconciliation does NOT require an adjusting entry?

Interest earned

A bank service charge

A note collected by the bank

Deposits in transit

QUESTION 5

The following information is available for Matt's Unlimited Company for the current month. What is the adjusted book balance on the bank reconciliation?
Book balance end of the month $5,575
Outstanding checks     $584
Deposits in transit    $ 2,500
Service charges             $75
Interest revenue             $25

$7,466

$5,500

$5,550

$5,525

QUESTION 6

Reducing expense to increase operating profit is representative of:

safeguarding assets.

following company policies.

promoting operational efficiency.

ensuring accurate, reliable accounting records.

QUESTION 7

Which of the following items will NOT appear on the book side of the reconciliation?

The bank collected a note receivable of $1,000 for the business.

A nonsufficient funds check of $75 was returned to the bank and deducted from the bank balance.

A deposit was in transit and not yet deposited in the bank.

The bank charged a service fee of $20 on the bank statement.

QUESTION 8

If an accountant takes an action that is deliberately designed to improve the company's financial results, it would be considered unethical if:

it deliberately misrepresents facts.

the action was taken specifically for the purpose of showing higher income.

the action will require a special journal entry.

the action is not in the best interests of the business owners.

QUESTION 9

Check Number 367 for $33.52 was incorrectly entered as $33.25. Which adjustment needs to be made?

Decrease the book balance.

Decrease the bank statement balance.

Increase the book balance.

Increase the bank statement balance.

QUESTION 10

A petty cash fund was established with a $400 balance. It currently has cash of $10 and
petty cash tickets as shown below.
Travel expense $120
Office supplies $200
Equipment rental expense $70  

The journal entry to replenish the account would be which of the following:

Debit various expenses $390, credit Cash $390

Debit various expenses $390, credit Petty cash fund $390

Debit Cash $10, credit various expenses $10

Credit Petty cash fund $390, debit Cash $390

The stock market crash of 2002

The savings and loan bailout

The accounting scandals of WorldCom and Enron

The mounting government deficit

Explanation / Answer

1) c. The accounting scandals of WorldCom and Enron

2) a. Assignment of responsibilities

3) c. To offer protection against theft

4) d. Deposits in transit

5) d.$5,525 ( 5575 - 75 + 25 )

6) c. promoting operational efficiency.

Ask other parts separately by mention the left part

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