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Assurance of Cash

Total questions: 30

Worksheet time: 15mins

Name
Class
Date
1.

What assertion of "To ensure that there is no unrecorded cash"

a)

Existence

b)

Cut-off

c)

Detail tie-in

d)

Completeness

2.

Cash is more susceptible to theft; therefore, there is high inherent risk for the (), (), and () objectives except:

a)

Existence

b)

Completeness

c)

Cut-off

d)

Accuracy

3.

The following which is not fraud-related Audit Procedures :

a)

Test of detail of cash balances

b)

Proof of cash

c)

Test of kiting

d)

Test of lapping

4.

What assertion for “Examine a sample of cash receipts and payments transactions for proper classification.”

a)

Classification

b)

Existence

c)

Valuation

d)

Completeness

5.

__________by the client subsequent to the balance sheet date, but recorded as cash receipts in the current year

a)

Deposit

b)

Payments

c)

Cash received

d)

Bank balance

6.

Purpose Of Auditing The Cash And Bank Balances

a)

To determine all cash received is properly recorded

b)

To ensure all disbursements are properly authorized and documented

c)

To recorded cash balances matches cash on hand or on deposit

d)

All above

7.

_____ is the transferring of money from one bank to another and incorrectly recording the transaction

a)

Transfer

b)

Flipping

c)

Frauding

d)

Kiting

8.

Which of the following procedures may uncover fraud in the cash receipts area?

a)

None of the above

b)

Deleting the receipts

c)

Aging of receipts

d)

Tests to detect lapping

9.

Which account is included in each business cycle except inventory and warehousing?

a)

Accounts receivable

b)

Cash

c)

Accounts payable

d)

Common stock

10.

To gather evidence regarding the balance per bank in a bank reconciliation, an auditor would easy examine all of the following except the:

a)

Bank confirmation

b)

Cutoff bank statement

c)

General ledger

d)

Year-end bank statement

11.

Fraud-related audit procedures for cash

a)

Proof of cash

b)

Test of kiting

c)

Extended bank reconciliations procedures

d)

All above

12.

On receiving the cutoff bank statement, the auditor should vouch

a)

Deposits in transit on the year-end bank reconciliation to deposits in the cash receipts journal

b)

Checks dated before year-end listed as outstanding on the year-end bank reconciliation to the cutoff statement

c)

Deposits listed on the cutoff statement to deposits in the cash receipts journal

d)

Checks dated after year-end to outstanding checks listed on the year-end bank reconciliation and to the cutoff statement

13.

Which of the following relatively small misstatements most likely could have a material effect on an entity's financial statements?

a)

A. An illegal payment to a foreign official that was not recorded.

b)

B. A piece of obsolete office equipment that was not retired.

c)

C. A petty cash fun disbursement that was not properly authorized.

d)

D. An uncollectible account receivable that was not written off.

14.

An assurance report on information can provide assurance about the information’s:

a)

Reliability

b)

relevance

c)

timeliness

d)

All the above

15.

Rodgers Company gathered the following reconciling information in preparing its May bank reconciliation. Determine the adjusted balance on May 31.

Cash balance per company records, May 31.........$5400

Notes received and collected by bank.........................$650

Deposits in transit........................................................................$375

Bank charges for check printing.....................................$40

Outstanding Checks.............................................................$2400

NSF Check...............................................................................$140

a)

$3845

b)

$4930

c)

$5870

d)

$6245

16.

A $127 petty cash fund has cash of $21 and receipts of $93. The journal entry to replenish the account would include which of the following?

a)

debit to Cash Short and Over for $13

b)

credit to Cash for $127

c)

debit to Cash for $21

d)

credit to Petty Cash for $93

17.

The debit made in the journal to reimburse the petty cash fund is to...

a)

Cash

b)

various accounts for which the petty cash was distributed

c)

Accounts Receivable

d)

Petty Cash

18.

Minor Company had checks outstanding totaling $19,200 on its April bank reconciliation. In May, Minor Co. issued checks totaling $64,900, and the bank statement shows that $47,600 in checks was cleared. The number of outstanding checks on Minor Co. May bank reconciliation should be:

a)

$17,300

b)

$36,500

c)

$66,800

d)

$28,400

19.

A voucher is usually supported by:

a)

a purchase order

b)

a supplier's invoice

c)

a receiving report

d)

All of these choices

20.

Which of the following would be subtracted from the balance per company records on a bank reconciliation?

a)

outstanding checks

b)

error in recording a check issued for $732 as $723

c)

notes collected by the bank

d)

deposits in transit

21.

Accompanying the bank statement was a debit memo for an NSF check received from a customer. This item would be included on the bank reconciliation as a(n):

a)

deduction from the balance per company's records

b)

addition to the balance per bank statement

c)

addition to the balance per company's records

d)

deduction from the balance per bank statement

22.

Accompanying the bank statement was a credit memo for a short-term note collected by the bank for the company. This item is a(n):

a)

deduction from the balance per company's records

b)

deduction from the balance per bank statement

c)

addition to the balance per company's records

d)

addition to the balance per bank statement

23.

Accompanying the bank statement was a debit memo for bank service charges. On the bank reconciliation, the item is a(n):

a)

deduction from the balance per the bank statement

b)

deduction from the balance per the company's record

c)

addition to the balance per the bank statement

d)

addition to the balance per the company's record

24.

A check drawn by a company for $340 in payment of liability was recorded in the journal as $430. This item would be included on the bank reconciliations a(n):

a)

addition to the balance per the bank statement

b)

addition to the balance per the company's record

c)

deduction to the balance per the bank statement

d)

deduction to the balance per the company's record

25.

Which of the following should NOT be considered cash by an accountant?

a)

bank checking account

b)

traveler's checks

c)

postage stamps

d)

money orders

26.

Consider the following information taken from the cash account. Assume cash payments were 80% of collections.

Cash

?????? Beginning Balance

$115,375 Deposits

???????? Checks

$80,275 Ending Balance

How much was the beginning balance of the cash account?

a)

$92,300

b)

$57,200

c)

$103,350

d)

$35,100

27.

Errors of ommision are

a)

Technical error

b)

Error of principle

c)

Compensating errors

d)

None of these

28.

Investment should be vouvhed with the help of

a)

Creditors statement

b)

Correspondence with suppliers

c)

Cash memos

d)

Ledger accounts

29.

Examine the cash receipts journal in the accounting system and compare the amounts received to the corresponding amounts invoiced in the revenue accounting system and to the bank statement evidencing the deposit. This is an example of which of the following?

a)

audit objective

b)

audit program

c)

audit assertion

d)

audit procedure

30.

While performing an engagement relating to an organization’s cash controls, the internal auditor observed that cash deposits are not deposited intact daily. A comparison of a sample of cash receipts lists revealed that each cash receipt list equaled cash journal entry amounts but not daily bank deposits amounts, and cash receipts list totals equaled bank deposit totals in the long run. This information as support for the internal auditor’s observations is

a)

Relevant but not sufficient or reliable.

b)

Sufficient but not reliable or relevant.

c)

Not sufficient, reliable, or relevant.

d)

Sufficient, reliable, and relevant.