4.4 Learning Objective 4-4
1) Internal controls for cash receipts over the counter and for cash receipts by mail are identical.
2) The duties of purchasing goods and receiving the goods should be given to the same employee.
3) A receiving report informs a vendor of the amount of goods received by the purchaser.
4) The treasurer is solely responsible for the petty cash fund.
5) Managers can use records produced by point-of-sale terminals to check inventory levels.
6) The sum of the cash in the petty cash fund and the total of the paid vouchers should equal the opening balance in the petty cash account at all times.
7) When a company receives customers' checks by mail:
A) all incoming mail containing checks from customers should be opened by the mailroom.
B) the mailroom sends all customer checks to the accounting department.
C) the remittance advices go to the treasurer for deposit.
D) the bank deposit is prepared by the mailroom.
8) When a company receives customers' checks by mail:
A) the mailroom sends all customer checks to the treasurer, who has the cashier deposit the checks in the bank.
B) the treasurer prepares the journal entries.
C) the mailroom employee prepares the journal entries.
D) the cashier in the treasury department prepares the journal entries.
9) Payment by check is an important internal control since:
A) the check provides a record of the payment.
B) the check must be signed by an authorized official who should study the evidence supporting the payment.
C) all checks must be approved by the bank's internal audit department before they are paid.
D) both A and B are true.
10) For good internal control:
A) the purchasing agent should also receive the goods.
B) the purchasing agent should also approve the invoice for payment.
C) the purchasing agent should not receive the goods or approve the invoice for payment.
D) the purchasing agent should not order the goods.