APU ACCT300 Week 3 quiz 3

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Question 1 of 20

5.0/ 5.0 Points

Money market funds, commercial paper, and U.S. Treasury
Bills are examples of cash equivalents.

A. True

B. False

Answer Key:

Question 2 of 20

5.0/ 5.0 Points

When companies sell their receivables to other companies,
the transaction is called factoring.

A. True

B. False

Answer Key:

Question 3 of 20

5.0/ 5.0 Points

The two methods of accounting for uncollectible receivables
are the allowance method and the:

A.equity method.

B.direct write-off method.

C.interest method.

D.cost method.

Answer Key:

Question 4 of 20

0.0/ 5.0 Points

A credit memorandum from the bank:

A.decreases a bank
customer’s account.

In B.is
used to show a bank service charge.

C.shows that a
company has deposited a customer’s NSF check.

D.shows the bank has
collected a note receivable for the customer.

Answer Key:

Question 5 of 20

5.0/ 5.0 Points

The amount of the “adjusted balance” appearing on a bank
reconciliation as of a given date is the amount that is shown on the balance
sheet for that date after all adjusting entries have been entered.

A. True

B. False

Answer Key:

Question 6 of 20

5.0/ 5.0 Points

In reference to a promissory note, the person who makes the
promise to pay is called the:

A.maker.

B.payee.

C.seller.

D.receiver.

Answer Key:

Question 7 of 20

5.0/ 5.0 Points

A special cash fund used to make small payments that occur
frequently is called a(n):

A.operating expenses
fund.

B.change fund.

C.market fund.

D.petty cash fund.

Answer Key:

Question 8 of 20

0.0/ 5.0 Points

Allowance for Doubtful Accounts has an unadjusted balance of
$500 at the end of the year, and an analysis of accounts in the customers’
ledger indicates doubtful accounts of $15,000. Compute the adjusted balance in
the allowance for doubtful accounts.

A.$15,000

In
B.$14,500

C.$14,000

D.$15,500

Answer Key:

Question 9 of 20

5.0/ 5.0 Points

The Sarbanes-Oxley Act of 2002 requires companies to
maintain strong and effective internal controls over recording transactions and
preparing financial statements.

A. True

B. False

Answer Key:

Question 10 of 20

5.0/ 5.0 Points

The difference between the total receivables and the balance
in Allowance for Doubtful Accounts at the end of a period is referred to as the
net realizable value of the receivables.

A. True

B. False

Answer Key:

Question 11 of 20

5.0/ 5.0 Points

The framework that has become widely accepted as the
standard by which companies design, analyze, and evaluate internal controls is
the:

A.Internal Control – Integrated Framework by
the Committee of Sponsoring Organizations.

B.Internal Control –
Integrated Framework by the Congress of Special Offerings.

C.Internal Control
Localized Structure by the Committee of Sponsoring Organizations.

D.Internal Control
Localized Structure by the Congress of Special Offerings.

Answer Key:

Question 12 of 20

5.0/ 5.0 Points

The Sarbanes-Oxley Act of 2002 requires companies to
maintain strong and effective internal controls over recording transactions and
preparing financial statements.

A. True

B. False

Answer Key:

Question 13 of 20

5.0/ 5.0 Points

Under which method of inventory costing is the cost flow
assumed to be in the reverse order in which the expenditures were made?

A.Average cost

B.Last-in, first-out

C.First-in, first-out

D.Specific
identification method

Answer Key:

Question 14 of 20

5.0/ 5.0 Points

Inventory costing methods place primary emphasis on
assumptions about:

A.flow of goods.

B.flow of costs.

C.flow of goods or
costs depending on the method.

D.flow of values.

Answer Key:

Question 15 of 20

0.0/ 5.0 Points

Accompanying the bank statement was a credit memorandum for
a short-term note collected by the bank for the customer. What adjustment is
required in the depositor’s accounts?

In
A.Increase Notes Receivable; decrease Cash

B.Increase Cash;
increase Miscellaneous Income

C.Increase Cash;
decrease Notes Receivable

D.Increase Accounts
Receivable, decrease Cash

Answer Key:

Question 16 of 20

5.0/ 5.0 Points

Inventories of merchandising and manufacturing businesses
are reported as current assets on the balance sheet.

A. True

B. False

Answer Key:

Question 17 of 20

0.0/ 5.0 Points

Accompanying the bank statement was a credit memorandum for
a short-term note collected by the bank for the customer. What adjustment is
required in the depositor’s accounts?

In
A.Increase Notes Receivable; decrease Cash

B.Increase Cash;
increase Miscellaneous Income

C.Increase Cash;
decrease Notes Receivable

D.Increase Accounts
Receivable, decrease Cash

Answer Key:

Question 18 of 20

5.0/ 5.0 Points

The bank reconciliation:

A.should be prepared
by an employee who records cash transactions.

B.is part of the internal control system.

C.is for information
purposes only.

D.is sent to the bank
for verification.

Answer Key:

Question 19 of 20

5.0/ 5.0 Points

Bank customers are considered owners of the bank, so the
bank shows their accounts as an asset on the bank’s records.

A. True

B. False

Answer Key:

Question 20 of 20

5.0/ 5.0 Points

The process of a company selling its accounts receivable to
another company is referred as:

A.discounting.

B.adjusting.

C.assignment.

D.factoring.

Answer Key:

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