Question

1,Policies and procedures that are established to protect and manage a company’s assets are known as

a record-keeping system.

an accounting system.

internal controls.

management controls.

2.Accounts receivable are reflected on the statement of financial position at the carrying amount which is

accounts receivable plus allowance for doubtful accounts.

accounts receivable less allowance for doubtful accounts.

accounts receivable plus bad debt expense.

accounts receivable less bad debt expense.

3.Who should be responsible for preparing the bank reconciliation?

the person who makes the deposits

the person who writes the cheques

the person who maintains the accounting records

a person not involved in the day-to-day banking activities

4.Which of the following do not affect the amounts collected on accounts receivables?

credit policy

returns policy

discounts policy

the allowance for doubtful accounts

Answer 1

1

Policies and procedures that are established to protect and manage a company’s assets are known as internal controls.

Internal controls helps in protection of company's assets and provides a check on frauds.

Option C internal controls is correct

2

Accounts receivable are reflected on the statement of financial position at the carrying amount which is accounts receivable less allowance for doubtful accounts.

Option B is correct

3

A person not involved in the day-to-day banking activities should be responsible for preparing the bank reconciliation.

It helps in providing better internal control when a person not involved in the day-to-day banking activities prepares bank reconciliation.

Option D is correct

4

The allowance for doubtful accounts do not affect the amounts collected on accounts receivables.

Option D is correct