Financial Accounting (12th Edition) (What's New in Accounting)
12th Edition
ISBN: 9780134725987
Author: C. William Thomas, Wendy M. Tietz, Walter T. Harrison Jr.
Publisher: PEARSON
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Textbook Question
Chapter 4, Problem 4.6S
(Learning Objective 3: Evalue internal controls over cash) Cash may be a small item on the financial statements. Nevertheless, internal control over cash is very important. Why is this true?
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Cash may be a small itemon the financial statements. Nevertheless, internal control over cash is very important. Why isthis true?
Which of the following is not a basic principle of cash management?
Keep inventory levels high.
Invest idle cash.
Increase the collection of receivables.
Delay payment of liabilities.
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Discuss why control over receivables is not quite as important as control over cash
Chapter 4 Solutions
Financial Accounting (12th Edition) (What's New in Accounting)
Ch. 4 - Prob. 1QCCh. 4 - Prob. 2QCCh. 4 - Prob. 3QCCh. 4 - Prob. 4QCCh. 4 - Prob. 5QCCh. 4 - Prob. 6QCCh. 4 - Prob. 7QCCh. 4 - Why does cash require some specific internal...Ch. 4 - Prob. 9QCCh. 4 - Prob. 10QC
Ch. 4 - Prob. 11QCCh. 4 - Prob. 12QCCh. 4 - Prob. 4.1ECCh. 4 - Prob. 4.1SCh. 4 - Prob. 4.2SCh. 4 - (Learning Objective 2: Describe objectives and...Ch. 4 - Prob. 4.4SCh. 4 - (Learning Objective 2: Explain the objectives and...Ch. 4 - (Learning Objective 3: Evalue internal controls...Ch. 4 - Prob. 4.7SCh. 4 - Prob. 4.8SCh. 4 - Prob. 4.9SCh. 4 - Prob. 4.10SCh. 4 - Prob. 4.11SCh. 4 - Prob. 4.12SCh. 4 - Prob. 4.13SCh. 4 - Prob. 4.14SCh. 4 - Prob. 4.15AECh. 4 - Prob. 4.16AECh. 4 - Prob. 4.17AECh. 4 - Prob. 4.18AECh. 4 - Prob. 4.19AECh. 4 - Prob. 4.20AECh. 4 - Prob. 4.21AECh. 4 - Prob. 4.22BECh. 4 - Prob. 4.23BECh. 4 - Prob. 4.24BECh. 4 - (Learning Objectives 1, 2, 3: Describe fraud and...Ch. 4 - Prob. 4.26BECh. 4 - Prob. 4.27BECh. 4 - Prob. 4.28BECh. 4 - Prob. 4.29QCh. 4 - Prob. 4.30QCh. 4 - Prob. 4.31QCh. 4 - Prob. 4.32QCh. 4 - Prob. 4.33QCh. 4 - Prob. 4.34QCh. 4 - Prob. 4.35QCh. 4 - Prob. 4.36QCh. 4 - Prob. 4.37QCh. 4 - Prob. 4.38QCh. 4 - Prob. 4.39QCh. 4 - Prob. 4.40QCh. 4 - Prob. 4.41APCh. 4 - Prob. 4.42APCh. 4 - Prob. 4.43APCh. 4 - Prob. 4.44APCh. 4 - Prob. 4.45BPCh. 4 - (Learning Objectives 2, 3: Explain the objectives...Ch. 4 - (Learning Objective 3: Evaluate internal controls)...Ch. 4 - Prob. 4.48BPCh. 4 - Prob. 4.49CEPCh. 4 - Prob. 4.50CEPCh. 4 - Prob. 4.51SCCh. 4 - Prob. 4.52DCCh. 4 - Prob. 4.53DCCh. 4 - Prob. 4.54EICCh. 4 - Prob. 1FFCh. 4 - Prob. 1FA
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Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Subject: FINANCIAL MANAGEMENT Answer the following questions: 1. Discussed in this chapter is the Imprest System. What is it and how does it help in managing the company's cash? 2. What is a compensating balance? Does it affect the company's disbursement policy? 3. In order to be classified as cash and cash equivalents, what are its requisites? Discuss each requisite briefly. See the attached link for reference: https://drive.google.com/file/d/1lT0HRXz4EKqT3le1AGT3oda98n3KCoQh/view?usp=drivesdkarrow_forwardWith good internal controls, the person who handles cash can also a. account for cash payments. b. account for cash receipts from customers. c. issue credits to customers for sales returns. d. None of the abovearrow_forwardKeeping cash locked away is an example of which control activity? a. Authorization b. Performance reviews • c. Physical control d. Segregation of dutiesarrow_forward
- 5. Describe one of the methods for managing cash disbursements or cash receipts and how it impacts profitability.arrow_forward[Question text] Cash management involves _________. Select one:A. maximizing the income earned on cash reservesB. determining the optimal level of liquidity that should be maintainedC. optimizing the collections and disbursements of cashD. reconciling a company's book balance with its bank balancearrow_forward1. Explain why the system of internal control is important for a company. 2. Describe some internal control practices usually implemented by companies. 3. Explain why cash control is important. 4. What is a voucher? What information are contained in a voucher? 5. Describe the features of the voucher system in handling cash disbursements? 6. What is a voucher register? What purpose does it serve?arrow_forward
- A cash receipts under a good control system will have. a. Encourage receipt of money through cheque b. Keep minimum bank book balance c. Too much amount in Cash balance d. Too much amount in Bank balancearrow_forwardWhich of the following is true of EFT? It is easy to document purchase and sale transactions. It means Effective Funds Transfer. It cost more than receiving cash payments through the mail. It can process certain cash transactions at less cost than by using the mail.arrow_forwardWhy is it important to have internal controls in managing and handling cash? What internal controls can you suggest?arrow_forward
- What is the major purpose of an imprest petty cash fund? A. to effectively plan cash inflows and outflows B. To ease the payment of cash to vendors C. to determine the honesty of the petty cash cashier D. To effectively control cash disbursementsarrow_forwardAccounting 1. Explain why the system of internal control is important for a company. 2. Describe some internal control practices usually implemented by companies. 3. Explain why cash control is important. 4. What is a voucher? What information are contained in a voucher? 5. Describe the features of the voucher system in handling cash disbursements? 6. What is a voucher register? What purpose does it serve?arrow_forwardWhat are the key factors that can lead to an under/overstatement of the cash balancearrow_forward
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