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Unit VI Flashcards

Unit VI Flashcards. Chapter 8. # 1. Bank reconciliation. Review. A document explaining the reasons for the difference between a depositor’s cash records and the depositor’s cash balance in its bank account. MARK FOR REVIEW. SHOW. NEXT. # 2. Cash equivalent. Review.

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Unit VI Flashcards

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  1. Unit VI Flashcards Chapter 8

  2. #1 Bank reconciliation Review A document explaining the reasons for the difference between a depositor’s cash records and the depositor’s cash balance in its bank account. MARK FOR REVIEW SHOW NEXT

  3. #2 Cash equivalent Review A highly liquid investment that can be converted into cash in three months or less. MARK FOR REVIEW SHOW NEXT

  4. #3 Cash ratio Review A measure of a company’s ability to pay current liabilities from cash and cash equivalents: (Cash + Cash equivalents) / Total current liabilities. MARK FOR REVIEW SHOW NEXT

  5. #4 Credit memorandum Review An increase in a bank account. MARK FOR REVIEW SHOW NEXT

  6. #5 Debit memorandum Review A decrease in a bank account. MARK FOR REVIEW SHOW NEXT

  7. #6 Deposit in transit Review A deposit recorded by the company but not yet by its bank. MARK FOR REVIEW SHOW NEXT

  8. #7 Deposit ticket Review A bank form that is completed by the customer and shows the amount of each deposit. MARK FOR REVIEW SHOW NEXT

  9. #8 Electronic Funds Transfer (EFT) Review A system that transfers cash by electronic communication rather than by paper documents. MARK FOR REVIEW SHOW NEXT

  10. #9 External auditor Review An outside accountant, completely independent of the business, who evaluates the controls to ensure that the financial statements are presented fairly in accordance with GAAP. MARK FOR REVIEW SHOW NEXT

  11. #10 Internal auditor Review An employee of the business who ensures the company’s employees are following company policies, that the company meets all legal requirements, and that operations are running efficiently. MARK FOR REVIEW SHOW NEXT

  12. #11 Petty cash Review A fund containing a small amount of cash that is used to pay for minor expenditures. MARK FOR REVIEW SHOW NEXT

  13. #12 Sarbanes-Oxley Act (SOX) Review Requires companies to review internal control and take responsibility for the accuracy and completeness of their financial reports. MARK FOR REVIEW SHOW NEXT

  14. ReferenceMiller-Nobles, T., Mattison, B., & Matsumura, E. M. (2016). Horngren’s accounting (11th ed.). Upper Saddle River, NJ: Pearson. END REVIEW

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