Fundamentals of Accountancy, Business and Management 2 - First Semester (2nd Periodical)
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Questions and Answers

Which party is responsible for making the check?

  • Drawee
  • Drawer (correct)
  • Payee
  • Bank

Where is the check number usually indicated on the check?

  • Upper left portion
  • Lower right portion
  • Lower left portion
  • Upper right portion (correct)

What does NSF stand for in the context of banking?

  • Not Sufficient Funds
  • Not Sufficient Fund (correct)
  • No Sufficient Funds
  • No Sufficient Fund

What are some reconciling items for the records of the company (book)?

<p>Credit memos (C)</p> Signup and view all the answers

What is the purpose of a bank reconciliation statement?

<p>To check the balance between the records of the company and the records of the bank (B)</p> Signup and view all the answers

Which party writes the various details including the monetary amount, date, and a payee on the cheque, and signs it, ordering his bank to pay that person or company the amount of money stated?

<p>Drawer (D)</p> Signup and view all the answers

What is the purpose of checks?

<p>To make payments without carrying large amounts of money (B)</p> Signup and view all the answers

What does NSF stand for in the context of banking?

<p>Not Sufficient Fund (D)</p> Signup and view all the answers

What are some examples of debit transactions mentioned in the text?

<p>Bank service charge and NSF (D)</p> Signup and view all the answers

What are some examples of reconciling items for the bank mentioned in the text?

<p>Deposits in transit and outstanding checks (C)</p> Signup and view all the answers

Which party is responsible for making the check?

<p>Drawer (B)</p> Signup and view all the answers

What is the purpose of checks?

<p>To make payments without the need to carry large amounts of money (D)</p> Signup and view all the answers

Where is the check number usually indicated on the check?

<p>Upper right portion (C)</p> Signup and view all the answers

Which of the following is a reason why a check may be returned as an NSF check?

<p>The account did not have enough money to cover the check (D)</p> Signup and view all the answers

What are check printing charges?

<p>Charges incurred when a company arranges for its bank to handle check reordering (C)</p> Signup and view all the answers

When does interest earned appear on a bank statement?

<p>When the company earns interest on its account balances (C)</p> Signup and view all the answers

What are Note Receivables?

<p>Assets of a company (C)</p> Signup and view all the answers

What can result in errors in a company's Cash account?

<p>All of the above (D)</p> Signup and view all the answers

Which of the following is a reconciling item for the bank mentioned in the text?

<p>Outstanding checks (D)</p> Signup and view all the answers

What is the purpose of a bank reconciliation statement?

<p>To check the balance between the company's records and the bank's records (A)</p> Signup and view all the answers

What is the first step in the bank reconciliation process?

<p>Adjusting the balance per bank (B)</p> Signup and view all the answers

What are some reconciling items for the records of the company (book)?

<p>Credit memos (C)</p> Signup and view all the answers

When do the adjusted balances in the bank reconciliation process need to be equal?

<p>After comparing the adjusted balances (D)</p> Signup and view all the answers

Which of the following is NOT a reconciling item for the records of the company (book)?

<p>Outstanding checks (D)</p> Signup and view all the answers

When does the adjusted cash balance appear on the Statement of Financial Position (Balance Sheet)?

<p>It does not appear on the Statement of Financial Position (D)</p> Signup and view all the answers

What are some examples of reconciling items for the bank mentioned in the text?

<p>Deposits in transit (B)</p> Signup and view all the answers

Which of the following is a purpose of business forms?

<p>To document business transactions (D)</p> Signup and view all the answers

What is the purpose of adjusting entries?

<p>To update accounting balances (D)</p> Signup and view all the answers

Which type of business form is used only within the business?

<p>Internal business form (C)</p> Signup and view all the answers

What is the purpose of closing entries?

<p>To reduce nominal or temporary accounts to zero (A)</p> Signup and view all the answers

What is the purpose of a bank reconciliation statement?

<p>To reconcile the company's records with the bank statement (A)</p> Signup and view all the answers

Which of the following is NOT a type of business form mentioned in the text?

<p>Sales invoice (A)</p> Signup and view all the answers

What is the purpose of adjusting entries?

<p>To update accounting balances and ensure accurate financial information (A)</p> Signup and view all the answers

Which of the following is NOT a book mentioned in the text?

<p>General ledger (D)</p> Signup and view all the answers

What is the purpose of the closing entries?

<p>To reduce nominal or temporary accounts to zero (B)</p> Signup and view all the answers

What is the purpose of the bank reconciliation statement?

<p>To reconcile the bank statement balance with the company's records (C)</p> Signup and view all the answers

Which type of business form is used to document cash transactions?

<p>Official receipts (B)</p> Signup and view all the answers

What is the purpose of adjusting entries?

<p>To update accounting balances (D)</p> Signup and view all the answers

Which type of account is debited against the income and expense summary account during the closing entries?

<p>Revenue account (C)</p> Signup and view all the answers

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