ACCOUNTING 201 EXAM 2025
QUESTIONS AND ANSWERS
The principles of internal control include _____. - ANS establish responsibilities
An internal control system consists of the policies and procedures managers use to _____.
-ensure reliable accounting
-protect assets
-promote efficient operations
-uphold company policies
-all of the above - ANS all of the above
An effective system of internal control _____. - ANS helps protect company assets
The Sarbanes-Oxley Act _____. - ANS requires managers of public companies to document
and assess the effectiveness of all internal control processes that impact financial reporting
Separation of duties _____. - ANS divides responsibility for a transaction between two or
more individuals
The company's balance sheet on September 30, reflects cash and cash equivalents of _____. -
ANS $109,500
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, Currency and coins on hand of $12,500 + Checking account balance of $35,000 + Customer
checks on hand (not yet deposited) of $2,000 + Money market fund balance of $50,000 +
Investment in 3-month U.S. Treasury bills of $10,000 = Total cash and cash equivalents of
$109,500. The investment in Microsoft common stock does not meet the criteria for a cash
equivalent, which is a short-term, highly liquid investment asset that is readily convertible to a
known cash amount and sufficiently close to its due date so that its market value is not
sensitive to interest rate changes.
Cash management principles include all of the following except _____. - ANS maximize other
assets
At the end of business on September 1, the total displayed on the cash register tape shows
$1,059 of cash sales for the day. However, when the clerk and the supervisor count the cash in
the register, the count reveals that $1,050 was actually collected from customers. Complete the
following journal entry by selecting the account names and dollar amounts from the drop-down
menus. - ANS (D) Cash $1050
(D) Cash Over and Short $9
(C)Sales $1059
All of the following statements regarding a voucher system are incorrect except _____.
-all companies use the same standardized voucher system
-an invoice approval initiates the recording of a purchase
-for control purposes, department managers may place orders directly with suppliers in a well-
designed voucher system
-a voucher system is commonly used in small companies to compensate for the lack of other
internal controls
-a well-designed voucher system will prevent all errors and fraud - ANS an invoice approval
initiates the recording of a purchase
On February 1, Derrick Company establishes a $200 petty cash fund. Complete the seller's
necessary journal entry by selecting the account names and dollar amounts from the drop-
down menus. - ANS (D) Petty Cash $200
2 Copyright ©2025 THESTAR ALL RIGHTS RESERVED
QUESTIONS AND ANSWERS
The principles of internal control include _____. - ANS establish responsibilities
An internal control system consists of the policies and procedures managers use to _____.
-ensure reliable accounting
-protect assets
-promote efficient operations
-uphold company policies
-all of the above - ANS all of the above
An effective system of internal control _____. - ANS helps protect company assets
The Sarbanes-Oxley Act _____. - ANS requires managers of public companies to document
and assess the effectiveness of all internal control processes that impact financial reporting
Separation of duties _____. - ANS divides responsibility for a transaction between two or
more individuals
The company's balance sheet on September 30, reflects cash and cash equivalents of _____. -
ANS $109,500
1 Copyright ©2025 THESTAR ALL RIGHTS RESERVED
, Currency and coins on hand of $12,500 + Checking account balance of $35,000 + Customer
checks on hand (not yet deposited) of $2,000 + Money market fund balance of $50,000 +
Investment in 3-month U.S. Treasury bills of $10,000 = Total cash and cash equivalents of
$109,500. The investment in Microsoft common stock does not meet the criteria for a cash
equivalent, which is a short-term, highly liquid investment asset that is readily convertible to a
known cash amount and sufficiently close to its due date so that its market value is not
sensitive to interest rate changes.
Cash management principles include all of the following except _____. - ANS maximize other
assets
At the end of business on September 1, the total displayed on the cash register tape shows
$1,059 of cash sales for the day. However, when the clerk and the supervisor count the cash in
the register, the count reveals that $1,050 was actually collected from customers. Complete the
following journal entry by selecting the account names and dollar amounts from the drop-down
menus. - ANS (D) Cash $1050
(D) Cash Over and Short $9
(C)Sales $1059
All of the following statements regarding a voucher system are incorrect except _____.
-all companies use the same standardized voucher system
-an invoice approval initiates the recording of a purchase
-for control purposes, department managers may place orders directly with suppliers in a well-
designed voucher system
-a voucher system is commonly used in small companies to compensate for the lack of other
internal controls
-a well-designed voucher system will prevent all errors and fraud - ANS an invoice approval
initiates the recording of a purchase
On February 1, Derrick Company establishes a $200 petty cash fund. Complete the seller's
necessary journal entry by selecting the account names and dollar amounts from the drop-
down menus. - ANS (D) Petty Cash $200
2 Copyright ©2025 THESTAR ALL RIGHTS RESERVED
