Acc224-2nd Exam Reviewer

1. Which of the following is generally not shown on 10.
Which of the following is least likely to be a major

a receiving report? criterion in vendor selection?
Answer: price of the items Answer: credit rating of the vendor
2. A voucher package should include 11. The accounts payable department receives a
Answer: a purchase order, vendor invoice, and purchase order form to accomplish all of the
receiving report. following except
Answer: Ensuring that the goods had been
3. The authority to accept incoming goods in received by the party requesting the goods.
receiving should be based on a(n)
Answer: Approved purchase order 12. Which of the following is a primary function of
the purchasing department?
4. The management at Barks-a-Million is Answer: Ensuring the acquisition of goods of a
considering a new inventory control system. The specified quality.
current system is inadequate because it
frequently cause stockouts that interrupt 13. The accounts payable department generally
production and lead to excess stock of other should
materials – resulting in markdowns and high Answer: Agree the vendor’s invoice with the
carrying costs. The new system will focus on receiving report and purchase order
ensuring that these costs are minimized. The
new inventory control system will likely employ 14. The mailing of disbursement checks and
Answer: the economic order quantity remittance advices should be controlled by the
employee who
5. This document is used to record adjustments to Answer: Signed the checks last
accounts payable based on return of
unacceptable inventory to supplier. 15. Once a purchase request is approved, what is the
Answer: debit memo next step?
Answer: The inventory master file is accessed to
6. This is a document that helps to ensure the find the preferred supplier(s).
receiving clerks count the number of goods
received. 16. Which duties should be segregated?
Answer: blind copy of purchase order Answer: writing checks and maintaining the
check register
7. Which of the following inventory control
methods is most likely to be used for a product 17. Which of the following information is LEAST
for which sales can be reliably forecast? LIKELY to be obtained when acquiring an
Answer: MRP inventory
Answer: Performance of the vendor
8. Vendor invoices are approved by the _____,
which reports to the _____. 18. Which of the following procedures is designed to
Answer: accounts payable department; prevent the purchasing agent from receiving
controller kickbacks?
Answer: requiring purchasing agents to disclose
9. Which electronic files are either read or updated any financial investments in potential suppliers
when goods are ordered from a vendor? 19. Which of the following is true?
Answer: inventory, vendors, and open purchase Answer: Cash disbursements is a treasury
orders function
20. Which of the following procedures is designed to Answer: Attachment of the receiving report to
prevent the purchasing agent from receiving the disbursement report.
kickbacks?
Answer: requiring purchasing agents to disclose 30. Requiring all packing slips be reconciled to
any financial investments in potential suppliers. purchase orders before accepting a delivery of
inventory would be most likely to prevent which
21. Which of the following tasks should the cash of the following situations?
disbursement clerk NOT perform? Answer: A supplier delivers more inventory
Answer: approve the liability than ordered at the end of the year and sends
an invoice for the total quantity delivered.
22. Who will usually approve the payment of
suppliers invoice? 31. Accounts Payable department authorize
Answer: Accounts payable payments, while Treasury department disburse
cash.
23. To achieve control when there is no billing Answer: Both statements are true.
department, the billing function should be
performed by 32. Paying for goods not received is prevented by
Answer: Accounting department Answer: Checking the purchase orders whether
they are properly authorized.
24. What is the reason for ensuring that every copy
of a vendor’s invoice has a receiving report? 33. The following internal control can detect the
Answer: To ascertain that merchandise billed by mistakes in posting to accounts payable, which is
the vendor was received by the company. not?
Answer: Require a complete voucher package.
25. What is the best control to mitigate the threat of
paying prices that are too high to goods ordered?
34-36 What are the three generic functions that need
Answer: Use only approved suppliers and solicit
to be segregated?
competitive bids.
34. Authorizing Transactions
26. What control would best mitigate the threat of 35. Recording Transactions
paying an invoice twice? 36. Custody of Assets
Answer: never authorizing payment of a
photocopy of an invoice 37-40 Enumerate the 4 primary activities of
Expenditure Cycle
27. Which control would best prevent payments 37. Ordering goods, supplies, and services
made to fictitious vendors? 38. Receiving and storing these items
Answer: Allow payments only to approved 39. Approving the invoice presented by vendors
vendors and suppliers
40. Paying for these items/the invoices
28. A surprise count of an imprest petty cash fund
should find the total of _____ equal to the
amount authorized for the fund.
Answer: cash and vouchers
29. A CPA learns that his client has paid a vendor

twice for the same shipment, once based upon
the original invoice and once based upon the
monthly statement. A control procedure that
should have prevented this duplicate payment is

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1. Which of the following is generally not shown on 10.

Which of the following is least likely to be a major

29. A CPA learns that his client has paid a vendor

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