1) List three reasons that indicate a receivable may become uncollectible.
2) Which one of the following is not an objective of a system of internal controls?
a.Safeguard company assets
b. Overstate liabilities in order to be conservative
c. Enhance the accuracy and reliability of accounting records
d. Reduce the risks of errors
3) From an internal control standpoint, the asset most susceptible to improper diversion & use is
a. prepaid insurance.
b. cash.
c. buildings.
d. land.
4) Having one person responsible for the related activities of ordering merchandise, receiving goods, and paying for them
a. increases the potential for errors and fraud.
b. decreases the potential for errors and fraud.
c. is an example of good internal control.
d. is a good example of safeguarding the company's assets.
5) When two or more people get together for the purpose of circumventing prescribed controls, it is called
a. a fraud committee.
b. collusion.
c. a division of duties.
d. bonding of employees.
6) Gretchen Gobbell Grace has worked for Hitone Inc., for 20 years without taking a vacation. An internal control feature that would address this situation would be
a. human resource controls.
b. establishment of responsibility.
c. physical controls.
d. documentation procedures.
7) Thomas Company identifies the following items for possible inclusion in the physical
inventory. Indicate whether each item should be included or excluded from the inventory taking.
i.
Goods shipped on consignment by Thomas to another company.
ii. Goods in transit from a supplier shipped FOB destination.
iii. Goods shipped via common carrier to a customer with terms FOB shipping point.
iv. Goods held on consignment from another company.
8) Pasquale has the following inventory information.
July 1    Beginning Inventory       20 units at $19    $ 380
7             Purchases                      70 units at $20       1,400
22          Purchases                      10 units at $24       240
                                                                                       $2,020
A physical count of merchandise inventory on July 31 reveals that there are 30 units on hand. Using the FIFO inventory method, the amount allocated to cost of goods sold for July is
a. $1,380.
b. $1,414
c. $1,470.
d. $1,440.
9) Pasquale has the following inventory information.
July 1 Beginning Inventory 20 units at $19 $ 380
7          Purchases             70 units at $20 1,400
22          Purchases             10 units at $24    240
                                                                        $2,020
A physical count of merchandise inventory on July 31 reveals that there are 30 units on hand. Using the LIFO inventory method, the amount allocated to cost of goods sold for July is
a. $1,380.
b. $1,414.
c. $1,470.
d. $1,440.

10) Pasquale has the following inventory information.
July 1 Beginning Inventory    20 units at $19    $ 380
7             Purchases             70 units at $20    1,400
22          Purchases             10 units at $24       240
                                                                           $2,020
A physical count of merchandise inventory on July 31 reveals that there are 30 units on hand. Using the average-cost inventory method, the amount allocated to cost of goods sold for July is
a. $1,380.
b. $1,414.
c. $1,470.
d. $1,440.

11) The Vogelsong Company accumulates the following cost and market value data at December 31.
                                                               Market
Inventory Categories Cost Data       Value Data
Camera                      $11,000             $9,900
Camcorders                   7,800                8,500
DVDs                            14,000             12,000
What is the lower-of-cost-or-market for each of the 3 items of inventory?
12) After the accounts are adjusted and closed at the end of the fiscal year, Accounts Receivable has a balance of $450,000 and Allowance for Doubtful Accounts has a balance of $30,000. What is the net realizable value of the accounts receivable?
13) One of your customers, Jim Dobbs, owes you $5,000. Please prepare journal entries for the following 3 transactions using the allowance method of accounting for uncollectible receivables:
a) June 10 - Received $1,000 from Jim Dobbs
b) June 11 - Received letter from Jim Dobbs, stating he was unable to pay any more money, so you wrote off the remainder owed of $4,000.
c) Oct. 15 - Reinstated the account of Jim Dobbs and received $4,000 cash in full payment.

14) Using the following information, prepare a bank reconciliation for Samtani Co. for March 31, 2017:
a) The bank statement balance is $4,110
b) The cash account balance is $4,257
c) Outstanding checks amounted to $416
d) Deposits in transit are $633
e) The bank service charge is $30
f) A check for $104 for supplies was recorded as $194 in the ledger (an error in recording)

15) Who is responsible for internal controls within an organization?
a. The internal auditor
b. The external auditor
c. Management
d. The PCAOB

16) The following article appeared in area newspapers on Saturday, December 11, 2010: NEW ROCHELLE, N.Y. - A Catholic nun who ran a suburban New York City college's finances embezzled more than $850,000 and spent it on herself, federal prosecutors said Friday.
The U.S. attorney in Manhattan said Sister Marie Thornton used lona College funds for her personal expenses from 1999 to 2009. As vice president of finance, she submitted false invoices and had lona pay her credit card bills, the complaint said. It did not detail her expenses. Thornton, 62, was arrested Thursday and pleaded not guilty in federal court in Manhattan. She was allowed to remain free. Her attorney, Sanford Talkin, said Friday "I expect us to reach a resolution that all sides will think is fair."
Thornton's religious order, the Sisters of St. Joseph, said Thornton had been recalled and her activities had been restricted. It said she has been ordered to cooperate with investigators and is being given "emotional and spiritual support."

lona reported a theft last year but did not publicly identify a suspect.
In a statement Friday, still not naming Thornton, the college said, "When it was discovered that the funds had been misappropriated, we took immediate action to terminate the employee." It said the theft had been investigated and new procedures implemented. "Today, we have a new CFO and staff in place; we have recovered the majority of the missing funds; and, from the
College's perspective, the matter is considered closed," the statement said. lona, named for an island monastery off the Scottish coast, was founded in 1940 and has about 4,200 students. Its main campus is in New Rochelle, 15 miles from Manhattan and 40 miles from Bridgeport, CT.
Required:
(a) In order for fraud to occur, two elements must be present, opportunity and motivation.
Please make reference to the text in the article above that supports/describes each element.
(b) In addition, there are several important characteristics (different from opportunity and motivation) that appear in many fraud cases. Please describe at least two of these characteristics that are described in the article, using the"Fraud" checklist posted on page 7 of the "Additional Power Point - Required Reading" in the Chapter 8 section of "Course Content" on BlackBoard as a reference.

1) List three reasons that indicate a receivable may become uncolle...