Question

When a firm uses internal auditors, it is adhering to which of the following internal control elements?

a.monitoring

b.proofs and security measures

c.risk assessment

d.information and communication

Hint(s)

The following data were accumulated for use in reconciling the bank account of Mathers Co. for July:

Cash balance according to the company's records at July 31, $32,110.

Cash balance according to the bank statement at July 31, $31,350.

Checks outstanding, $2,870.

Deposits in transit, not recorded by bank, $4,150.

A check for $170 in payment of an account was erroneously recorded in the check register as $710.

A bank debit memo for service charges, $20.

Determint the adjusted balance for both bank and book.

Double-click on the box below to edit your answer choices.

A.$33,390

B.$31,590

C.$32,630

D.$30,070

Hint(s)

A $150 petty cash fund has cash of $54 and receipts of $83. The journal entry to replenish the account would include a

a.credit to Cash for $54

b.debit to Cash for $83

c.credit to Petty Cash for $29

d.debit to Cash Short and Over for $13

A necessary element of internal control is

a.information and communication

b.systems analysis

c.systems design

d.a database

Answer 1

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Solution: Note: All are individual questions. Although all have been answered to help:) Explanation Because, purpose of internal auditing is monitoring the activities of business. Answer: 1) a. Monitoring 2) C. $32,630 Bank Reconciliation Bank's Cash Balance Company's Cash Balance Bank's Cash Balance Deposit in Transit Check outstandin Bank Balance Per Recon 31,350 Per general ledger $ 4,150 Bank Service fee $ -2,870 Error (710-170 S 32,110 $ -20 $ 540 32,630 Company Balance per recon. 32,630 3) d.debit to Cash Short and Over for $13 Because, after replenish, the balance should be $150 (54+83+13) 4) a.information and communication It is a necessary and important factor for internal control. Through information and communication, auditors can perform their role effectivelly and efficiently