Internal Controls in Accounting: Help and Review Chapter Exam

Exam Instructions:

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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Question 1 1. Which of the following is NOT a purpose of the Sarbanes-Oxley Act?

Question 2 2. What is the term for balancing a company's cash account to its bank account?

Question 3 3. The Securities and Exchange Commission created a special group called the _____ to set the guidelines that all accounting professionals must follow.

Question 4 4. The _____ creates the guidelines that all accounting professionals must follow in order to produce accurate and reliable financial statements.

Question 5 5. What is the term for money received from consumers from the sale of goods or services?

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Question 6 6. Measures that are taken to prevent someone or something from an undesirable outcome are called _____.

Question 7 7. How did the stock market crash of 1929 affect the creation of the Security and Exchange Commission?

Question 8 8. Procedures that are put in place within an organization to ensure business is carried out in an orderly, effective and accurate manner are called _____.

Question 9 9. Ben, a company accountant, accidentally reported $5300 of earnings as $3500 on a company financial statement. Ben's mistake is an example of _____.

Question 10 10. Internal controls need to contain written protocols and _____.

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Question 11 11. _____ means to separate one big job into several small jobs, with a different individual performing each.

Question 12 12. Which of the following is a goal of having safeguards in the banking industry?

Question 13 13. What year was the Sarbanes-Oxley Act enacted?

Question 14 14. Which statement best describes earnings management?

Question 15 15. What are rules and regulations that are put into place to guard assets owned by a person or a company?

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Question 16 16. The information found on the financial statements of a company that tells how good or bad a company is performing is called _____.

Question 17 17. Which of the following is an example of a cash equivalent?

Question 18 18. A way to monitor a company's credit, collections, cash allocation and disbursement policies as well as its invoicing function is called which of the following?

Question 19 19. Two people have differing opinions on the reporting period for a company's income. What typical problem are they most likely experiencing with their financial information?

Question 20 20. _____ are rules and regulations that are put into place to guard the assets owned by a person or a company.

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Question 21 21. What is the business asset most vulnerable to fraudulent activity?

Question 22 22. GAAP standards require that a(n) _____ be included in the notes to the financial statements.

Question 23 23. The earnings management technique that occurs when expenses are based on estimates is _____.

Question 24 24. What is the term for monies paid out to individuals for the purchase of items that are needed and used by a company?

Question 25 25. The organization that oversees the audits of public companies is called the _____.

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Question 26 26. Jan is the accounting manager for ABC Manufacturing. In her role she instructs newly hired accountants in the use of internal controls. Why would she stress the importance of accuracy when they are creating financial documents?

Question 27 27.

A company has the following information:

$10,000 in the bank $25,000 in 90 day CDs $15,000 in 1 year bonds $5,000 in money orders $30,000 in real estate

How much cash and cash equivalents does the company have on-hand?

Question 28 28. To separate one big job into several small jobs with a different individual performing each is called _____.

Question 29 29. How is the acronym WISE used to describe the reasons behind earnings management?

Question 30 30.

Jane owns a chain of flower shops, but due to bad business, she had to close down two of her shops. Jane knows that this loss has already caused a decrease in net earnings. She decides to charge a majority of the companies expenses to the shut down of the two shops.

Identify the earnings management technique that Jane has decided to use.

Internal Controls in Accounting: Help and Review Chapter Exam Instructions

Choose your answers to the questions and click 'Next' to see the next set of questions. You can skip questions if you would like and come back to them later with the yellow "Go To First Skipped Question" button. When you have completed the practice exam, a green submit button will appear. Click it to see your results. Good luck!

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