Questions from Financial Accounting

Q: Hamid’s Hardware reported cost of goods sold as follows.

Hamid’s Hardware reported cost of goods sold as follows. Hamid’s made two errors: (1) 2018 ending inventory was overstated $3,000, and (2) 2019 ending inventory w...

Q: Eve Herschel is the owner of Herschel’s Pizza. Herschel’s is operated

Eve Herschel is the owner of Herschel’s Pizza. Herschel’s is operated strictly on a carryout basis. Customers pick up their orders at a counter where a clerk exchanges the pizza for cash. While at the...

Q: The following control procedures are used at Torres Company for over-

The following control procedures are used at Torres Company for over-the-counter cash receipts. 1. To minimize the risk of robbery, cash in excess of $100 is stored in an unlocked briefcase in the sto...

Q: The following control procedures are used in Mendy Lang’s Boutique Shoppe for

The following control procedures are used in Mendy Lang’s Boutique Shoppe for cash disbursements. 1. The company accountant prepares the bank reconciliation and reports any discrepancies to the owner....

Q: At Danner Company, checks are not prenumbered because both the purchasing

At Danner Company, checks are not prenumbered because both the purchasing agent and the treasurer are authorized to issue checks. Each signer has access to unissued checks kept in an unlocked file cab...

Q: Listed below are fi ve procedures followed by Eikenberry Company.

Listed below are fi ve procedures followed by Eikenberry Company. 1. Several individuals operate the cash register using the same register drawer. 2. A monthly bank reconciliation is prepared by someo...

Q: Listed below are fi ve procedures followed by Gilmore Company.

Listed below are fi ve procedures followed by Gilmore Company. 1. Employees are required to take vacations. 2. Any member of the sales department can approve credit sales. 3. Paul Jaggard ships goods...

Q: Setterstrom Company established a petty cash fund on May 1, cashing

Setterstrom Company established a petty cash fund on May 1, cashing a check for $100. The company reimbursed the fund on June 1 and July 1 with the following results. June 1: Cash in fund $1.75. Recei...

Q: Horvath Company uses an imprest petty cash system. The fund was

Horvath Company uses an imprest petty cash system. The fund was established on March 1 with a balance of $100. During March, the following petty cash receipts were found in the petty cash box. The fu...

Q: Fredonia Repair Inc. was started on May 1. A summary

Fredonia Repair Inc. was started on May 1. A summary of May transactions is presented below. 1. Stockholders invested $10,000 cash in the business in exchange for common stock. 2. Purchased equipment...