| unbiased and neutral | Which of the following terms describing information in the financial statements are properly matched? |
| upon replenishment | Under the imprest petty cash system, expenses out of the petty cash fund are recorded |
| Increase in asset and decrease in equity | Which is not a possible combination of a journal entry? |
| true, true, true | Consider the following statements. |
| Transfers journal entries to the ledger accounts. | Posting |
| financial accounting | General-purpose financial statements are the product of |
| a degree of caution in the exercise of judgments about estimates is made | In respect to information included in financial statements, the accounting concept of prudence ensures that |
| before adjusting entries are entered in the journal and posted to the ledger | In the accounting cycle, a worksheet is prepared |
| it must be classified as an external event rather than an internal event. | Which one of these is not among the criteria to consider an event as accountable? |
| Debit individual expense accounts, credit Cash in bank | In replenishing a petty cash fund, which one of the following entries is required? |
| all items except bank errors, outstanding checks, and deposits in transit. | Bank reconciliations are normally prepared on a monthly basis to identify adjustments needed in the depositor's records and to identify bank errors. Adjustments should be recorded for |
| statement of retained earnings | The financial statements most frequently provided include all of the following except the |
| To provide information on the liquidation value of an entity. | Which statement is not a specific objective of financial reporting? |
| the safeguarding of cash | Cash control systems are the methods and procedures used to ensure |
| The same under the cash basis as under the accrual basis | Total net income over the life of an entity is |
| Postdated checks and IOUs | Which of the following shall not be considered "cash" for financial reporting purposes? |
| The reimbursement of the petty cash fund should be credited to the cash account. | When a petty cash fund is used, which of the following is true? |
| financial statements are prepared | The recording phase of financial accounting covers the following steps, except |
| Remove the balances from the entity's temporary accounts | Closing entries |
| They always involve legal restrictions on the cash received. | Which of the following statements concerning compensating balance agreements is not true? |
| II, I and III | Arrange the following steps in their correct order: |
| The dual effect of each transaction is recorded with a debit and a credit. | The double entry accounting system means |
| Postdated checks and I.O.U.'s | Which of the following is not considered cash for financial reporting purposes? |
| inherent uncertainties of many accounting measurements | Accounting traditionally has been influenced by conservatism because of the |
| Adjusting entries where revenue or expense recognition precedes cash flow | Accruals are |
| interest credited to the account by the bank | In reconciling the bank balance with the book cash balance, which of the following would not cause the bank shown in the bank statement to be lower than the unadjusted book balance? |
| Which cannot be offset is classified as current liability | Bank overdraft |
| Is the foundation for the Conceptual Framework. | The objective of financial reporting in the Conceptual Framework |
| Short-term and highly liquid investments that are readily convertible into cash and acquired three months before maturity | Cash equivalents are |
| Liabilities, revenue and share capital are credited for increases. | In recording transactions |
| Preparation of the post-closing trial balance | Which among the following is the last step in the accounting cycle? |
| P30,500 | In preparing its May 31, 2019 bank reconciliation, Dogg Co. has the following information available: |
| to help users make decisions | Which of the following best states the objective of general purpose financial statements? |
| Is so near maturity that it presents insignificant risk of change in interest rate | A cash equivalent is a short-term, highly liquid investment that is readily convertible into known amount of cash and |
| Confirmatory value | Which of the following is not an ingredient of faithful representation according to Conceptual Framework for Financial Reporting? |
| Bank overdrafts | Which of the following is generally classified as a current liability on the balance sheet? |
| Postdated checks | Which of the following is considered cash? |
| The responsibility for receiving merchandising and paying for it should usually be given to one person | Which of the following statements is incorrect? |
| The petty cash custodian files receipts by category of expenditure after their presentation to the general cashier so that variations in different types of expenditures can be monitored. | Which of the following is not an appropriate procedure for controlling the petty cash fund? |
| All of these may prove that debits and credits are equal. | A trial balance may prove that debits that debits and credits are equal, except |
| 2, 4 and 6 | In reconciling a business cash book with the bank statement, which of the following items could require a subsequent entry in the cash book? |
| understandability | What links the decision makers and the decisions they make so that financial information would be useful? |
| All of these statements are true about the |
| Conceptual Framework. | Which statement is true about the Conceptual Framework for Financial Reporting? |
| material | If financial information that is presented in a balance sheet or income statement is misstated and it influences the economic decisions of users, that information is described as |
| increase assets | The adjusting entry at the end of the accounting year to reflect revenues earned but not yet collected or recorded will |
| Consists of one debit and one credit | A simple journal entry |
| Collected and not currently matched with expense | An unearned revenue can be best be described as an amount |
| trial balance | A control device that helps minimize and localize accounting errors is known as |
| A schedule that accounts for the difference between an entity's cash balance as shown in the bank statement and the cash balance shown in the general ledger. | A bank reconciliation is |
| the bank, when certifying checks, automatically debits the company's account | In preparing the bank reconciliation, certified checks should be excluded from outstanding checks. The rationale for this treatment is |
| Note receivable collected by the bank in favor of the depositor and credited to the account of the depositor. | Which of the following items must be added to the cash balance per ledger in preparing a bank reconciliation which ends with adjusted balance? |
| Debit asset, credit liability | Which of the following least resembles a typical adjusting entry? |
| daily entry in a voucher register | Which is not a key element of internal control over cash receipts? |
| Uses the accrual basis of accounting | Adjusting entries are needed because an entity |
| imprest system | The internal control feature that is specific to petty cash is |
| Equipment | All of the following would be regarded as financial instruments EXCEPT: |
| cash disbursements journal | A cash refund to a customer for sales returns should be entered in |
| Objective of financial reporting | Which of the following provides "the why" or the goal and purpose of accounting? |
| improved allocation of resources | Which of the following is a benefit of providing financial information? |
| Financial statements, closing entries and reversing entries | Which is a logical order in the accounting cycle? |
| A firm's investment in government treasury bills. | Which of the following best qualifies as a "cash equivalent?" |
| relevant | Which term best describes information that influences the economic decision of users? |
| Post-dated checks from customers | Which of the following is most likely not considered as cash for financial reporting purposes? |
| Equity investments | All of the following can be classified as cash and cash equivalents EXCEPT: |
| Readily convertible into cash and acquired 3 months before maturity | Cash equivalents are short-term and highly liquid investments that are |
| P10,000 | Hamilton Company has cash in bank of P10,000, restricted cash in a separate account of P3,000, and a bank overdraft in an account at another bank of P1,000. Hamilton should report cash of |
| Recording depreciation of a truck | Which of the following is an example of an adjusting entry? |
| Financial asset | Under existing accounting rules, cash is considered as a |
| It proves that debits and credits were properly entered in the ledger accounts. | Which of the following is not correct about an unadjusted trial balance? |
| That is useful for decision making | The overall objective of financial reporting is to provide information |
| Three months or less | In order to be classified as a cash equivalent, an investment must have a maturity period of |
| #202 and #404 | The information below was taken from the bank transfer schedule prepared during the audit of Fox Co.'s financial statements for the year ended December 31, 2018. Assume all checks are dated and issued on December 30, 2018. |
| change retained earnings | The effect of closing entries is to |
| Side represented by the increase in the account balance | The normal balance of an account is on the |
| account | It is an accounting device for accumulating increases and decreases relating to a particular accounting value such as an asset or a liability. |
| a mixture of costs and values | What is the valuation basis used in conventional financial statements? |
| 4,600,000 | Tranvia Company had the following balances on December 31, 2018: |
| The segregated account should be reported as a noncurrent asset, the regular account should be reported as a current asset, and the overdraft should be reported as a current liability. | On October 31, 2018, Dingo, Inc. had cash accounts at three different banks. One account balance is segregated solely for a November 15, 2018 payment into a bond sinking fund. A second account, used for branch operations, is overdrawn. The third account, used for regular corporate operations, has a positive balance. How should these accounts be reported in Dingo's October 31, 2018 classified balance sheet? |
| II only | On an entity's December 31, 2018 statement of financial position which of the following items should be included in the amount reported as cash? |
| assist investors in predicting prospective cash flows | A primary objective of financial reporting is to: |
| is a four-column bank reconciliation showing reconciliation of cash balances per book and per bank at the beginning and end of the current month and reconciliation of cash receipts and cash disbursement of the bank and the depositor during the current month. | A proof of cash |
| One nominal account and one real account | Adjusting entries affect |
| All of these | The Conceptual Framework is intended to assist |
| At least one real and one nominal account | Adjusting entries involve |
| Equity investments | All of the following can be classified as cash and cash equivalents, except? |
| economic entity assumption | Preparation of consolidated financial statements when a parent-subsidiary relationship exists is an example of |
| May be classified as current or non-current depending on the purpose for its establishment | Cash set aside for a particular purpose (i.e. restricted) |
| All of these are users | Users of financial reports include all of the following except |
| 4,500,000 | Thor Company provided the following data on December 31, 2018: |
| All of the following can be classified as cash |
| and cash equivalents, |
| All of the following can be classified as cash and cash equivalents, |
| Bank reconciliations are normally prepared on a |
| monthly basis to identify adjustments needed in the depositor's records and to |
| identify bank errors. Adjustments should be recorded for |
| Cash equivalents are |
| Consider the following statements. |
| General-purpose |
| financial statements are the product of |
| In preparing its May |
| 31, 2019 bank reconciliation, Dogg Co. has the following |
| information available: |
| In preparing the bank reconciliation, certified checks should be |
| excludedfrom outstanding checks. The |
| rationale for this treatment is |
| In reconciling a business cash book with the bank statement, which of the |
| following items could require a subsequent entry in the cash book? |
| In replenishing a petty cash fund, which |
| one of the following entries is required? |
| On an entity's December 31, 2018 statement of financial position |
| which of the following items should be included in the amount reported as cash? |
| On October 31, 2018, Dingo, Inc. had cash accounts at three |
| different banks. One account balance is segregated solely for a November 15, |
| 2018 payment into a bond sinking fund. A second account, used for branch |
| operations, is overdrawn. The third account, used for regular corporate |
| operations, has a positive balance. How should these accounts be reported in |
| Dingo's October 31, 2018 classified balance sheet? |
| The financial statements |
| most frequently provided include all of the following the |
| The information below was taken from the bank transfer schedule prepared |
| during the audit of Fox Co.'s financial statements for the year ended December |
| 31, 2018. Assume all checks are dated and issued on December 30, 2018. |
| Users of financial reports |
| include all of the following |
| When a petty cash fund is used, which of the |
| following is true? |
| When a petty cash fund is used, which of the following is true? |
| Which of the following best qualifies as a "cash |
| equivalent?" |
| Which of the following is |
| considered cash? |
| Which of the following is considered cash for financial |
| reporting purposes? |
| Which of the following is not an appropriate procedure for |
| controlling the petty cash fund? |
| Which of the following shall not be considered |
| "cash" for financial reporting purposes? |
| Which of the following statements is incorrect? |
