BUSA Exam 2 Newest 2025 Actual Exam
Questions And Detailed Answers With
Rationales(VERIFIED ANSWERS) Already
Graded A+||| Brand New Version!!!! Review
Perry Binder
Internal controls should help prevent goods from being stolen. True or false?
Answer:
True. One of the primary functions of internal control systems is to prevent loss,
misuse or misappropriation of assets
Which of the following is inappropriate?
a. The person receiving a deposit makes out the deposit slip.
b. The person making out the deposit slip makes the deposit.
c. The person sending out the bill records the transaction in the system.
d. The person recording transactions reconciles the bank statements.
(b). The person making the deposit slip has the ability to alter the deposit. Thus,
these are not compatible duties. Often, the person receiving the deposit also
makes out the deposit slip.
A warrant is: a. a request for funds drawn on the treasury of a government.
b. a request for funds drawn on a financial institution regulated by the Federal
,Reserve System.
c. a request for funds to cover a ZBA.
d. a request for the payment of a recurring electronic payment.
(a). A request for funds drawn on a financial institution is a check. A request for
funds to cover a ZBA is an intra-bank transfer. A request for the payment of a
recurring electronic payment is a request for an electronic funds transfer.
Which of the following should not be done through electronic payments?
a. the payroll of the government
b. payments to retirees
c. a payment for a one-time purchase
d. payments for the purchase of investments
(c). The amount of time involved in setting up an account for an electronic
payment would be too costly for a one-time purchase. This is particularly true if
the amount is small.
A government should establish a different bank account for each of its funds.
True or false?
False. A government should concentrate its accounts for increased investment
potential. The accounting system should be used to track the cash balances for
each fund.
Which of the following is not a duty of the Federal Reserve System? a.
guaranteeing direct loans of the federal government
b. maintaining stability of the financial system
,c. conducting monetary policy for the government.
d. supervising and regulating banking institutions
(a). The Federal Reserve System does not guarantee loans of the federal
government. Loans are guaranteed by agencies of the federal government.
A county government collects funds from property taxes in late December each
year. The county releases property taxes collected on behalf of school districts
on the following July 1. Which of the following investments would be the most
prudent investment of this money for six months?
a. bond funds
b. commercial paper
c. equities
d. real estate
e. checking account interest
(b). Commercial paper is a short-term investment instrument, which would be the
most appropriate and prudent given the limited time period. Bond funds are long-
term investments, while equities and real estate have a greater degree of risk.
The interest from a checking account would be much less than the interest from
commercial paper.
A county government is able to issue debt securities at an interest rate of 4
percent and can invest that money in a U.S. government Treasury bill earning 5
percent. Which of the following could prevent this combined transaction from
being profitable?
a. total return b. benchmarking
, c. prudent expert rule
d. arbitrage
(d). The federal government has arbitrage restrictions on the amount that can be
earned from investments.
A county government is able to issue debt securities at an interest rate of 4
percent and can invest that money in a U.S. government Treasury bill earning 5
percent. Which of the following could prevent this combined transaction from
being profitable?
a. total return
b. benchmarking
c. prudent expert rule
d. arbitrage
(d). The federal government has arbitrage restrictions on the amount that can be
earned from investments.
Quotes for over-the-counter securities can be obtained on the:
a. NYSE.
b. NASDAQ.
c. AMEX.
d. Chicago Board of Trade.
(b). The NASDAQ provides the quotes for securities that are traded over-the-
counter. The other markets provide quotes only for the securities that are listed
on the appropriate exchange.
Questions And Detailed Answers With
Rationales(VERIFIED ANSWERS) Already
Graded A+||| Brand New Version!!!! Review
Perry Binder
Internal controls should help prevent goods from being stolen. True or false?
Answer:
True. One of the primary functions of internal control systems is to prevent loss,
misuse or misappropriation of assets
Which of the following is inappropriate?
a. The person receiving a deposit makes out the deposit slip.
b. The person making out the deposit slip makes the deposit.
c. The person sending out the bill records the transaction in the system.
d. The person recording transactions reconciles the bank statements.
(b). The person making the deposit slip has the ability to alter the deposit. Thus,
these are not compatible duties. Often, the person receiving the deposit also
makes out the deposit slip.
A warrant is: a. a request for funds drawn on the treasury of a government.
b. a request for funds drawn on a financial institution regulated by the Federal
,Reserve System.
c. a request for funds to cover a ZBA.
d. a request for the payment of a recurring electronic payment.
(a). A request for funds drawn on a financial institution is a check. A request for
funds to cover a ZBA is an intra-bank transfer. A request for the payment of a
recurring electronic payment is a request for an electronic funds transfer.
Which of the following should not be done through electronic payments?
a. the payroll of the government
b. payments to retirees
c. a payment for a one-time purchase
d. payments for the purchase of investments
(c). The amount of time involved in setting up an account for an electronic
payment would be too costly for a one-time purchase. This is particularly true if
the amount is small.
A government should establish a different bank account for each of its funds.
True or false?
False. A government should concentrate its accounts for increased investment
potential. The accounting system should be used to track the cash balances for
each fund.
Which of the following is not a duty of the Federal Reserve System? a.
guaranteeing direct loans of the federal government
b. maintaining stability of the financial system
,c. conducting monetary policy for the government.
d. supervising and regulating banking institutions
(a). The Federal Reserve System does not guarantee loans of the federal
government. Loans are guaranteed by agencies of the federal government.
A county government collects funds from property taxes in late December each
year. The county releases property taxes collected on behalf of school districts
on the following July 1. Which of the following investments would be the most
prudent investment of this money for six months?
a. bond funds
b. commercial paper
c. equities
d. real estate
e. checking account interest
(b). Commercial paper is a short-term investment instrument, which would be the
most appropriate and prudent given the limited time period. Bond funds are long-
term investments, while equities and real estate have a greater degree of risk.
The interest from a checking account would be much less than the interest from
commercial paper.
A county government is able to issue debt securities at an interest rate of 4
percent and can invest that money in a U.S. government Treasury bill earning 5
percent. Which of the following could prevent this combined transaction from
being profitable?
a. total return b. benchmarking
, c. prudent expert rule
d. arbitrage
(d). The federal government has arbitrage restrictions on the amount that can be
earned from investments.
A county government is able to issue debt securities at an interest rate of 4
percent and can invest that money in a U.S. government Treasury bill earning 5
percent. Which of the following could prevent this combined transaction from
being profitable?
a. total return
b. benchmarking
c. prudent expert rule
d. arbitrage
(d). The federal government has arbitrage restrictions on the amount that can be
earned from investments.
Quotes for over-the-counter securities can be obtained on the:
a. NYSE.
b. NASDAQ.
c. AMEX.
d. Chicago Board of Trade.
(b). The NASDAQ provides the quotes for securities that are traded over-the-
counter. The other markets provide quotes only for the securities that are listed
on the appropriate exchange.
