APUS ACCT100 Week 4 Chapter 7 & 8 Homework latest 2016 feb.
Chapter 7
1. Which of the following benefits of an effective accounting information system provides safeguards for a? business's assets and reduces the likelihood of fraud and? errors?
A.
Compatibility
B.
Control
.C.
Relevance
D.
Flexibility
2 . Which of the following is not a special? journal?
A.
Purchases journal
B.
Cash receipts journal
C.
General journal
.D.
Sales journal
3. Which of the following correctly describes the posting of transactions from the sales? journal?
A.
The total of the Accounts Receivable? DR, Sales Revenue CR column is posted to the accounts receivable subsidiary ledger.
B.
At the end of the? month, the totals of the columns are posted to the general ledger.
C.
Individual accounts receivables are posted daily to the general ledger.
D.
Transactions are posted daily to the general ledger.
4. Use the following sales journal to record the transactions.
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5. Centex Sound Systems purchased merchandise inventory costing? $8,000 from Flower Co. on account. Where should Centex record this? transaction, and what account is? credited?
A.
General? journal; credit Inventory
B.
Purchases? journal; credit Accounts Payable
C.
Cash payments? journal; credit Cash
D.
Sales? journal; credit Sales Revenue
6. Every transaction recorded in the cash payments journal includes a
A.
Debit to Sales Discounts
B.
Debit to Cash
C.
Debit to Accounts Receivable
D.
Credit to Cash
7. Use the following purchases journal to record the transactions
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8. When using a manual accounting information? system, which of the following transactions would be recorded in the general? journal?
A.
Cash payment of rent
B.
Depreciation of office furniture
C.
Purchase of merchandise inventory on account
D.
Sale of merchandise inventory on account
9. Disadvantages of an enterprise resource planning? (ERP) system include
A.
Implementation requires a large commitment of time and people
B.
Can replace separate software systems
C.
Can reduce costs
D.
Helps companies adjust to changes
10. Soccer world uses the perpetual inventory system and makes all credit sales on terms of 22?/10, ?n/30. Soccer WorldSoccer World completed the following transactions during NovemberNovember?:
1
Owner contributed
$ 44 comma 000$44,000
in exchange for capital.
1
Purchased merchandise inventory on credit terms of
22?/15,
?n/60 from
Sampson Co.Sampson Co.?,
$ 5 comma 100$5,100.
3
Issued invoice no. 1001 for sale on account to
Haddie MayHaddie May?,
$ 4 comma 000$4,000.
Soccer World'sSoccer World's
cost of this merchandise inventory was
$ 1 comma 900$1,900.
3
Collected interest revenue of
$ 3 comma 300$3,300.
4
Issued invoice no. 1002 for sale on account to
Berkner Co.Berkner Co.?,
$ 3 comma 000$3,000
?(cost,
$ 2 comma 100$2,100?).
8
Issued check no. 900 to purchase equipment for? cash,
$ 4 comma 200$4,200.
9
Sold merchandise inventory for? cash,
$ 2 comma 600$2,600
?(cost,
$ 1 comma 500$1,500?).
10
Received cash from
Haddie MayHaddie May
in full settlement of her account receivable from the sale on
Nov.Nov.
3.
MayMay
earned a discount by paying early.
11
Purchased merchandise inventory for? cash,
$ 5 comma 300$5,300?,
issuing check no. 901.
11
Purchased office supplies on account from
Jessie Inc.Jessie Inc.?,
$ 700$700.
Terms were? n/EOM.
13
Issued check no. 902 to pay
Sampson Co.Sampson Co.
the net amount owed from
Nov.Nov.
1. Round to the nearest dollar.
14
Issued invoice no. 1003 for credit sale to
Haddie MayHaddie May?,
$ 310$310
?(cost,
$ 140$140?).
15
Issued credit memo to
Berkner Co.Berkner Co.
for
$ 450$450
for merchandise inventory returned by
BerknerBerkner.
Also accounted for receipt of the merchandise inventory at? cost,
$ 310$310.
16
Sold merchandise inventory on account to
Roland MakiRoland Maki?,
issuing invoice no. 1004 for
$ 670$670
?(cost,
$ 300$300?).
17
Received cash from
Berkner Co.Berkner Co.
in full settlement of its account receivable from
Nov.Nov.
?4, less return.
17
Purchased merchandise inventory on credit terms of net 30 from
Sampson Co.Sampson Co.?,
$ 4 comma 400$4,400.
19
Issued check no. 903 to pay for insurance? coverage, debiting Prepaid Insurance for
$ 2 comma 200$2,200.
20
Purchased equipment on credit terms of
33?/10,
?n/60 from
Huston Co.Huston Co.?,
$ 1 comma 430$1,430.
22
Returned damaged merchandise inventory to
Sampson Co.Sampson Co.?,
issuing a debit memo for
$ 300$300.
22
Purchased merchandise inventory on credit terms of
22?/10,
?n/30 from
Sampson Co.Sampson Co.?,
$ 750$750.
25
Issued check no. 904 to pay? utilities,
$ 470$470.
27
Issued check no. 905 to pay
Sampson Co.Sampson Co.?,
in full on account from
Nov.Nov.
17? purchase, less return.
30
Issued check no. 906 to pay monthly salaries of
$ 4 comma 500$4,500.
30
Received cash in full from
Haddie MayHaddie May
on credit sale of
Nov.Nov.
14. There was no discount.
30
Issued check no. 907 to pay
Jessie Inc.Jessie Inc.
in full on account from
Nov.Nov.
11 purchase.
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1. |
Enter the transactions in a sales journal? (page 10), a cash receipts journal? (page 8), a purchases journal? (page 13), a cash payments journal? (page 12), and a general journal? (page 9), as appropriate. |
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2. |
Total each column of the special journals. Show that total debits equal total credits in each special journal. |
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3. |
The following? four-column accounts have been opened in the subsidiary ledgers. Enter the beginning balance as of NovemberNovember ?1: Accounts receivable ledgerlong dash—Amber Co.Amber Co.?, $ 2 comma 220$2,220?; Berkner Co.Berkner Co.?, $ 0$0?; Roland MakiRoland Maki?, $ 0$0?; and Haddie MayHaddie May?, $ 0$0. Accounts payable ledgerlong dash—Huston Co.Huston Co.?, $ 0$0?; Jessie Inc.Jessie Inc.?, $ 0$0?; Sampson Co.Sampson Co.?, $ 0$0?; Zebra Co.Zebra Co.?, $ 630$630. |
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4. |
Post daily to the accounts receivable subsidiary ledger and to the accounts payable subsidiary ledger. |
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5. |
The following? four-column general ledger accounts have been opened using Soccer World'sSoccer World's account numbers and balances as of NovemberNovember ?1, 20142014?: |
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On NovemberNovember ?30, post to the general ledger. |
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6. |
Prepare a trial balance as of NovemberNovember ?30, 20142014 to verify the equality of the general ledger. Balance the total of the customer balances in the accounts receivable subsidiary ledger against Accounts Receivable in the general ledger. Do the same for the accounts payable subsidiary ledger and Accounts Payable in the general ledger. |
Chapter 8
Which of the following is not part of the definition of internal? control?
A.
Encourage employees to follow company policy
B.
Promote operational efficiency
C.
Separation of duties
.D.
Safeguard assets
2. The? Sarbanes-Oxley Act
A.
allows accountants to audit and to perform any type of consulting work for a public company.
B.
requires that an outside auditor must evaluate a public? company's internal controls.
C.
created the Private Company Accounting Board.
D.
stipulates that violators of the act may serve 20 years in prison for securities fraud.
3. Pendley Productions makes all sales on credit. Cash receipts arrive by mail. Nathan Speiler in the mailroom opens the envelopes and separates the checks from the accompanying remittance advices. SpeilerSpeiler forwards the checks to another? employee, who makes the daily bank deposit but has no access to the accounting records. SpeilerSpeiler sends the remittance? advices, which show cash? received, to the accounting department for entry in the accounts. Speiler'sSpeiler's only other duty is to grant sales allowances to customers.? (A sales allowance decreases the amount of the? receivable.) When SpeilerSpeiler receives a customer check for $ 575$575 less a $ 45$45 sales? allowance, he records the sales allowance and forwards the document to the accounting department.
Requirements
1.
Identify the internal control weakness in this situation.
2.
Who should record sales? allowances?
3.
What is the amount that should be shown in the ledger for cash? receipts?
4. Michelle Darby receives cash from customers. Her other assigned job is to post the collections to customer accounts receivable. Her company has weak
A.
ethics.
B.
separation of duties.
C.
computer controls.
D.
assignment of responsibilities.
5. Payment by check is an important internal control over cash payments because
A.
before signing the? check, the official reviews the invoice supporting the payment.
B.
the check must be signed by an authorized official.
C.
Both a and b
D.
None of the above
6. Suppose that on JuneJune ?1, FabFab ?Gyrations, a disc jockey? service, creates a petty cash fund with an imprest balance of $ 400$400. During June commaJune, Ruth ManganRuth Mangan?, fund? custodian, signs the following petty cash? tickets:
Petty Cash
Ticket Number
Item
Amount
1
Postage for package received
$35
2
Office party
25
3
Two boxes of stationery
20
4
Printer cartridges
15
5
Business dinner
55
On JuneJune 3030?, prior to? replenishment, the fund contains these tickets plus cash of $ 246$246. The accounts affected by petty cash payments are Office? Supplies, Entertainment? Expense, and Postage Expense.
Requirements
1.
On JuneJune 3030?, how much cash should this petty cash fund hold before it is? replenished?
2.
Journalize all required entries to? (a) create the fund and? (b) replenish it. Include explanations.
3.
Make the entry on MayMay 1 to increase the fund balance to $ 500$500. Include an explanation.
7. Dance Studio created a $ 200$200 imprest petty cash fund. During the? month, the fund custodian authorized and signed petty cash tickets as? follows:
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Petty Cash |
|
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|
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Ticket No. |
Item |
Account Debited |
Amount |
|
1 |
Delivery of programs |
Delivery Expense |
$30 |
|
to customers |
|
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2 |
Mail package |
Postage Expense |
10 |
|
3 |
Newsletter |
Printing Expense |
20 |
|
4 |
Key to closet |
Miscellaneous Expense |
50 |
|
5 |
Copier paper |
Office Supplies |
55 |
Requirement
1.
Make the general journal entry to create the petty cash fund. Include an explanation.
2.
Make the general journal entry to record the petty cash fund replenishment. Cash in the fund totals $ 22$22. Include an explanation.
3.
Assume that Louise'sLouise's Dance Studio decides to decrease the petty cash fund to $ 100$100. Make the general journal entry to record this decrease.
8. The DecemberDecember cash records of DonaldDonald Insurance? follow:
|
Cash Receipts |
|
Cash Payments |
||
|
Date |
Cash Debit |
|
Check No. |
Cash Credit |
|
Dec. 4 |
$4,150 |
1416 |
$870 |
|
|
9 |
520 |
1417 |
150 |
|
|
14 |
570 |
1418 |
680 |
|
|
17 |
2,160 |
1419 |
1,190 |
|
|
31 |
1,830 |
1420 |
1,470 |
|
|
|
|
1421 |
900 |
|
|
|
|
|
1422 |
630 |
?'s Cash account shows a balance of $ 17 comma 140$17,140 at DecemberDecember 3131. On DecemberDecember 3131?, DonaldDonald Insurance received the following bank? statement:
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Bank Statement for December |
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Beginning Balance |
|
|
$13,800 |
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Deposits and other Credits: |
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|||
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Dec. |
1 |
|
EFT |
$600 |
|
|
|
Dec. |
5 |
|
|
4,150 |
|
|
|
Dec. |
10 |
|
|
520 |
|
|
|
Dec. |
15 |
|
|
570 |
|
|
|
Dec. |
18 |
|
|
2,160 |
|
|
|
Dec. |
22 |
|
BC |
1,600 |
9,600 |
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Checks and other Debits: |
|
|
|
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Dec. |
8 |
NSF |
$600 |
|
|
|
|
Dec. |
11 |
(check no. 1416) |
870 |
|
|
|
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Dec. |
19 |
|
EFT |
400 |
|
|
|
Dec. |
22 |
(check no. 1417) |
150 |
|
|
|
|
Dec. |
29 |
(check no. 1418) |
680 |
|
|
|
|
Dec. |
31 |
(check no. 1419) |
|
1,910 |
|
|
|
Dec. |
31 |
|
SC |
10 |
(4,620) |
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Ending Balance |
|
|
$18,780 |
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Explanations: BC-bank collection; EFT-electronic funds transfer; |
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NSF-nonsufcient funds checks; SC-service charge |
Additional data for the bank reconciliation?follows:
a.
The EFT credit was a receipt of rent. The EFT debit was an insurance payment.
b.
The NSF check was received from a customer.
c.
The $ 1 comma 600$1,600 bank collection was for a note receivable.
d.
The correct amount of check number 1419 for rent expense is $ 1 comma 910$1,910. DonaldDonald?'s controller mistakenly recorded the check for $ 1 comma 190$1,190.
Requirements
1. Prepare the bank reconciliation of DonaldDonald Insurance at DecemberDecember 3131?, 20152015.
2. Journalize any required entries from the bank reconciliation.
9. Long BranchLong Branch ?Company's Cash account shows an ending balance of $ 710$710. The bank statement shows a $ 12$12 service charge and an NSF check for $ 200$200. A $ 260$260 deposit is in? transit, and outstanding checks total $ 360$360. What is Long BranchLong Branch?'s adjusted cash? balance?
A.
$ 610$610
B.
$ 498$498
C.
$ 398$398
D.
$ 922$922
10. ScottScott Air Conditioning? & Heating had the following select financial data as of June? 30, 20152015.
Cash
$9,000
Cash Equivalents
36,500
Accounts Receivable
4,200
Total current liabilities
70,000
What is ScottScott?'s cash? ratio?
A.
1.541.54
B.
0.710.71
C.
0.130.13
D.
0.650.65
11. The ScottScott Sun? & Shade Company had the following financial data for the year ended December? 31, 20152015?:
Cash and cash equivalents
$75,000
Total current liabilities
150,000
What is the cash ratio as of December? 31, 20152015?, for ScottScott Sun? & Shade?
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Solution: APUS ACCT100 Week 4 Chapter 7 & 8 Homework latest 2016 feb.