Question : 71. Which of the following the most serious limitation of internal : 1256915

 

 

71. Which of the following is the most serious limitation of internal controls? 

A. Computer error

B. Human fraud or human error

C. Cost-benefit principle

D. Cybercrime

E. Management fraud

 

 

72. Which of the following are risks of e-commerce? 

A. Firewalls, fraud, and computer viruses.

B. Encryption, stolen credit card numbers, and fraud.

C. Stolen credit card numbers, computer viruses, and impersonation.

D. Computer viruses, encryption, and stolen credit card numbers.

E. Impersonation, encryption, and firewalls.

 

 

73. Cash, not including cash equivalents, includes: 

A. Postage stamps.

B. Coins, currency, and checking accounts.

C. IOUs.

D. Two-year certificates of deposit.

E. Money market funds.

 

 

74. Cash equivalents: 

A. Are short-term, highly liquid investments.

B. Include six-month CDs.

C. Include checking accounts.

D. Are recorded in petty cash.

E. Include money orders.

 

 

75. Cash equivalents: 

A. Include savings accounts.

B. Include checking accounts.

C. Are short-term investments sufficiently close to their maturity date that their value is not sensitive to interest rate changes.

D. Include time deposits.

E. Have no immediate value.

 

 

76. A check: 

A. Involves the writer, the signers, the cashier, and the bank.

B. Involves the maker, the payee and the bank.

C. Involves the maker and the payee.

D. Involves the bookkeeper, the payee, and the bank.

E. Involves the signer, the cashier, and the company.

 

 

 

77. A remittance advice is: 

A. An explanation for a payment by check.

B. A bank statement.

C. A voucher.

D. An EFT.

E. A canceled check.

 

 

78. For which item does a bank NOT issue a debit memorandum? 

A. To notify a depositor of all withdrawals through an ATM.

B. To notify a depositor of a deduction to a depositor’s account.

C. To notify a depositor of a bounced check.

D. To notify a depositor of periodic payments arranged in advance, by a depositor.

E. To notify a depositor of a deposit to their account.

 

 

79. Why is it a matter of good internal control to deposit all cash receipts daily and make all payments for goods and services by check? 

A. When no paper documents are required, there is increased convenience and lower cost

B. These actions control the access to cash and create an independent record of all cash activities.

C. These procedures result in a more extensive testing of a company’s records.

D. The Sarbanes-Oxley Act requires these steps be taken by each publicly traded company.

E. These procedures allow management to determine if projected cash receipts and disbursements came in over or under budgeted amounts.

 

 

80. The number of days’ sales uncollected: 

A. Is used to evaluate the liquidity of receivables.

B. Is calculated by dividing accounts receivable by sales.

C. Measures a company’s ability to pay its bills on time.

D. Measures a company’s debt to income.

E. Is calculated by dividing sales by accounts receivable.