Source Documents – Accounting & Finance Quiz
The key terms in these Finance chapters include revenue cycle, accounts receivable, reasonableness test, Source Documents, internal control problem, Virtualization, turnaround documents, specialized journal.
In a revenue cycle with proper controls, the ________ who reports to the ________, is not involved in any cash handling activities.
accounts receivable clerk; treasurer
cashier; treasurer
accounts receivable clerk; controller – Correct
cashier; controller
The manager of Callow Youth Clothing was entering an order online from Sad Clown Pajamas. He ordered 100 one-size fits all pajama bottoms, but when he ordered 1000 one-size fits all pajama tops, the following error message popped up: “Did you mean to enter a quantity of 1000 for your order?” This message is the result of a
validity check.
reasonableness test. – Correct
limit check.
closed-loop verification.
Which of the following poses an internal control problem?
Products are released from inventory after a warehouse employee and a shipping clerk both sign the pick list.
Sales representatives have authority to increase customers’ credit limits in $1,000 increments. – Correct
Physical inspection of inventory quantity and condition is outsourced to a firm that specializes in this service.
When customer payments are received in the mail, checks are sent to the cashier’s office and remittance advices are sent to the accounts receivable department.
Virtualization refers to the ability of
using the Internet to perform all needed system functions.
eliminating the need for a physical computer.
using web-based security to protect an organization.
running multiple systems simultaneously on one physical computer. – Correct
Documents that are sent to customers or suppliers and then sent back to the company in the course of a business transaction are known as
turnaround documents. – Correct
input documents.
source documents.
transaction documents.
The type of journal that records large numbers of repetitive transactions such as sales, cash receipts, and cash disbursements is
a detailed transaction journal.
a specialized journal. – Correct
a subsidiary journal.
What role should an auditor play in system development?
an advisor and developer of internal control specifications
an independent reviewer only – Correct
a developer of internal controls
A and B above
Who generally is responsible for providing the accounting department with information about financing and investing activities to create the appropriate general ledger journal entries?
The budget department.
The CEO.
The treasurer. – Correct
The CFO.
If you believe a general ledger account was not adjusted properly or at all, you should prepare a general ledger control report listing journal vouchers in
numerical sequence.
general ledger account number order. – Correct
any order, since you have to review them all anyway.
chronological order.
In a revenue cycle with proper controls, the ________ who reports to the ________, is not involved in any cash handling activities.
accounts receivable clerk; treasurer
cashier; treasurer
accounts receivable clerk; controller – Correct
cashier; controller
The manager of Callow Youth Clothing was entering an order online from Sad Clown Pajamas. He ordered 100 one-size fits all pajama bottoms, but when he ordered 1000 one-size fits all pajama tops, the following error message popped up: “Did you mean to enter a quantity of 1000 for your order?” This message is the result of a
validity check.
reasonableness test. – Correct
limit check.
closed-loop verification.
Which of the following poses an internal control problem?
Products are released from inventory after a warehouse employee and a shipping clerk both sign the pick list
Sales representatives have authority to increase customers’ credit limits in $1,000 increments. – Correct
Physical inspection of inventory quantity and condition is outsourced to a firm that specializes in this service.
When customer payments are received in the mail, checks are sent to the cashier’s office and remittance advices are sent to the accounts receivable department.
Virtualization refers to the ability of
using the Internet to perform all needed system functions.
eliminating the need for a physical computer.
using web-based security to protect an organization.
running multiple systems simultaneously on one physical computer. – Correct
Documents that are sent to customers or suppliers and then sent back to the company in the course of a business transaction are known as
turnaround documents. – Correct
input documents.
source documents.
transaction documents.
The type of journal that records large numbers of repetitive transactions such as sales, cash receipts, and cash disbursements is
a detailed transaction journal.
a specialized journal. – Correct
a subsidiary journal.
a general journal.
What role should an auditor play in system development?
an advisor and developer of internal control specifications
an independent reviewer only – Correct
a developer of internal controls
A and B above
Who generally is responsible for providing the accounting department with information about financing and investing activities to create the appropriate general ledger journal entries?
The budget department.
The CEO.
The treasurer. – Correct
The CFO.
If you believe a general ledger account was not adjusted properly or at all, you should prepare a general ledger control report listing journal vouchers in
numerical sequence.
general ledger account number order. – Correct
any order, since you have to review them all anyway.
chronological order.