Principles of Financial Accounting.
24th Edition
ISBN: 9781260158601
Author: Wild
Publisher: MCG
expand_more
expand_more
format_list_bulleted
Question
Chapter 8, Problem 4E
To determine
To identify if the policy is good or bad and cash management strategy violated or followed.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
Determine whether each policy below is good or bad cash management, then identify the cash management strategy violated or followed for each policy.
1. The company negotiates credit terms with suppliers to delay payment of liabilities as long as possible
2. Excess cash is put in checking accounts, earning no interest income.
3. Cash receipts and cash payments are regularly planned and reviewed.
4. Customers are offered discounts to pay early.
5. All equipment is purchased, even equipment infrequently used.
Good or Bad
Cash Management Strategy
Determine whether each policy below is good or bad cash management; then identify the cash management strategy violated or followed for each policy. 1. Bills are paid as soon as they are received. 2. Cash receipts and cash payments are regularly planned and reviewed. 3. Excess cash is put in checking accounts, earning no interest income. 4. Customers are regularly allowed to pay after due dates without concern. 5. Rarely used equipment is rented rather than purchased.
cash?
هذا خلاص
A cash payment under a good
control system will have.
a.
Too much amount Bank book
balance
b.
Appointing different persons to
authorize the payment and sign the
cheques
С.
Too much amount book balance
d.
Maintaining minimum bank book
balance
Chapter 8 Solutions
Principles of Financial Accounting.
Ch. 8 - Prob. 1MCQCh. 8 - Prob. 2MCQCh. 8 - Prob. 3MCQCh. 8 - Prob. 4MCQCh. 8 - Prob. 1DQCh. 8 - Prob. 2DQCh. 8 - Prob. 3DQCh. 8 - Prob. 4DQCh. 8 - Prob. 5DQCh. 8 - Prob. 6DQ
Ch. 8 - Which of the following assetsinventory, building,...Ch. 8 - What is a petty cash receipt? Who should sign it?Ch. 8 - Prob. 9DQCh. 8 - Prob. 10DQCh. 8 - Prob. 11DQCh. 8 - Prob. 12DQCh. 8 - Prob. 13DQCh. 8 - Prob. 1QSCh. 8 - COSO internal control components C1 COSO lists...Ch. 8 - Prob. 3QSCh. 8 - Prob. 4QSCh. 8 - Prob. 5QSCh. 8 - Prob. 6QSCh. 8 - Prob. 7QSCh. 8 - Prob. 8QSCh. 8 - Prob. 9QSCh. 8 - Prob. 10QSCh. 8 - Prob. 11QSCh. 8 - Prob. 1ECh. 8 - Prob. 2ECh. 8 - Prob. 3ECh. 8 - Prob. 4ECh. 8 - Prob. 5ECh. 8 - Prob. 6ECh. 8 - Prob. 7ECh. 8 - Prob. 8ECh. 8 - Prob. 9ECh. 8 - Prob. 10ECh. 8 - Prob. 11ECh. 8 - Prob. 12ECh. 8 - Prob. 13ECh. 8 - Prob. 14ECh. 8 - Prob. 15ECh. 8 - Prob. 16ECh. 8 - Prob. 1APCh. 8 - Prob. 2APCh. 8 - Prob. 3APCh. 8 - Prob. 4APCh. 8 - Prob. 5APCh. 8 - Prob. 1BPCh. 8 - Prob. 2BPCh. 8 - Prob. 3BPCh. 8 - Prob. 4BPCh. 8 - Prob. 8SPCh. 8 - Prob. 1AACh. 8 - Prob. 2AACh. 8 - Prob. 3AACh. 8 - Prob. 1BTNCh. 8 - Prob. 2BTNCh. 8 - Prob. 3BTNCh. 8 - Prob. 4BTNCh. 8 - Review the opening feature of this chapter that...Ch. 8 - Prob. 6BTN
Knowledge Booster
Similar questions
- 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 one of these principles is considered for cash disbursement control Select one: O a. Print check amount by machine O b. Same staff approve and make payment Oc. Reconcile bank statement annually O d. Rarely compare checks to invoicesarrow_forwardA cash payment under a good control system will have. a. Too much amount Bank book balance b. Appointing different persons to authorize the payment and sign the cheques c. Too much amount book balance d. Maintaining minimum bank book balancearrow_forward
- Applying internal control over cash payments by check A purchasing agent for Franklin Office Supplies receives the goods that he purchases and also approves payment for the goods. Requirements 1. How could this purchasing agent cheat his company? 2. How could Franklin avoid this internal control weakness?arrow_forwardMoving to another question will save this response. Question 12 The entry to establish a petty cash fund includes: O A. A debit to Cash and a credit to Cash Over and Short. A debit to Cash and a credit to Petty Cash Over and Short. A debit to Petty Cash and a credit to Cash. A debit to Cash and a credit to Petty Cash. В. OC. Moving to another question will save this response. O000arrow_forwardExercise 6-4 (Algo) Cash management strategies LO C2 Determine whether each policy below is good or bad cash management; then identify the cash management strategy violated or followed for each policy. Cash payments and receipts are not planned. Instead, the company assumes it will have enough sales to not have to worry about cash shortages. Excess cash is used to acquire productive assets or short-term investments. All buildings are purchased, even those the company only plans to occupy for a few months. The company negotiates credit terms with suppliers to delay payment of liabilities as long as possible. Customers are regularly allowed to pay after due dates.arrow_forward
- What Petty Cash involves, choose the best answer: Select one: O a. Establishing the fund, making check payment and never replenish the fund b. Establishing the fund, making payment and replenish the fund c. Establishing the fund, making check payment and replenish the fund d. Borrow the fund, making payment and replenish the fundarrow_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_forwardThe purpose of a petty cash fund is toa. Provide a convenient form of payment for the company’s customers. b. Pay employee salaries at the end of each period. c. Provide cash on hand for minor expenditures. d. Allow the company to save cash for major future purchases.arrow_forward
- Moving to another question will save this response. Quèstion 9 The entry to decrease a petty cash fund includes: A debit to Petty Cash and a credit to Cash. A debit to Cash and a credit to Petty Cash. A debit to Cash and a credit to Cash Over and Short. A debit to Cash and a credit to Petty Cash Over and Short. А. В. D. A Moving to another question will save this response.arrow_forwardE8B. ACCOUNTING CONNECTION Developing a convenient means of reimbursing sales representatives with cash for their incidental expenses, such as for meals and supplies, is a problem many companies face. Under one company's plan, the sales representatives submit the receipts for reimbursement to the petty cash custodian. The representative then receives cash from the petty cash fund. What is the weak point in this system? What fundamental principle of internal con- trol is being ignored? What improvement in the procedure can you suggest?arrow_forwardHigh level cash management strategies include a.petty cash b.delaying payment for suppliers c.cash over and short d.bank reconciliationsarrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Pkg Acc Infor Systems MS VISIO CDFinanceISBN:9781133935940Author:Ulric J. GelinasPublisher:CENGAGE LAuditing: A Risk Based-Approach to Conducting a Q...AccountingISBN:9781305080577Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:South-Western College PubAuditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage Learning
- Principles of Accounting Volume 1AccountingISBN:9781947172685Author:OpenStaxPublisher:OpenStax CollegeCornerstones of Financial AccountingAccountingISBN:9781337690881Author:Jay Rich, Jeff JonesPublisher:Cengage Learning
Pkg Acc Infor Systems MS VISIO CD
Finance
ISBN:9781133935940
Author:Ulric J. Gelinas
Publisher:CENGAGE L
Auditing: A Risk Based-Approach to Conducting a Q...
Accounting
ISBN:9781305080577
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:South-Western College Pub
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning
Principles of Accounting Volume 1
Accounting
ISBN:9781947172685
Author:OpenStax
Publisher:OpenStax College
Cornerstones of Financial Accounting
Accounting
ISBN:9781337690881
Author:Jay Rich, Jeff Jones
Publisher:Cengage Learning