Test one AIS (the A/D practice test one)

A document that accompanies the invoice sent to the customer that can be returned to the seller with the cash payment is called a:

remittance advice

When a company receives an ACH payment of an account receivable, the first recording of information about the collection is in the:

cash receipts journal

A document that indicates such things as the description and quantity of goods and services received, the price including freight, the cash discount terms and the date of billing. It is an essential document because it specifies the amount of money owed for an acquisition. This document is a:

vendor invoice

A document indicating a reduction in the amount due from a customer because of returned goods or an allowance granted is called a:

credit memo

A document prepared at the time of shipment indicating the description of the merchandise, the quantity shipped and other relevant data. It is a contract of the receipt and shipment of goods between the seller and the carrier. This document is a:

bill of lading

An auditor wants to verify that for a given inventory acquisition, (1) the merchandise was ordered by the company, (2) the merchandise was received by the company, and (3) a bill for the merchandise was received from the vendor. The auditor should look at which documents?

purchase order, receiving report, vendor invoice

When a customer of a company inquires about the amount which the customer owes the company, the clerk handling the question would go to the:

accounts receivable subsidiary ledger

If a manager wanted to know how many units of product “Q” had been sold during the current year, the information would be obtained from:

perpetual inventory records

A company purchased merchandise from the “X” Corporation. You picked up the merchandise as you delivered the order to purchase. You paid for the merchandise instantly with one of your company’s checks. Where would this transaction be recorded first by your company?

cash disbursements journal

Depreciation of fixed assets used during the year was estimated to be $20,000. Where would this information be recorded first?

general journal

The clerk who opens mail is assigned responsibility for preparing a document which identifies all cash collections received in the mail for a given day. This document is called:

cash receipts prelist form

Identify the following document:

purchase order

Identify the following document:

receiving report

Identify the following document:

sales invoice

Identify the following document:

credit memo

A Client's accounting records are unfamiliar to a new auditor. Where would a new auditor go to learn the names and numbers of the accounts being debited and credited in the transactions.

chart of accounts

Which of the following transactions would be recorded in the general journal?

depreciation recorded annually

What is the normal sequence of recording a transaction where inventory was acquired?

purchase order, purchases journal, general ledger

To determine how much a company owes one of its vendors, the accounting clerk would go to the

accounts payable subsidiary ledger

Which of the following transactions would not be recorded in the sales journal?

Cash Sale

Which of the following are not shown on a fixed asset subsidiary ledger?

all of the the choices are shown on the fixed asset subsidiary ledger

Which, if any, of the following is not a reason for preparing an accounts receivable aged trial balance?

Display activity (cash receipts and sales) for each individual account.

An auditor wants to determine that sales transactions are recorded in the proper period. The document the auditor will be most interested in is:

bill of lading

In determining cost of goods sold under the periodic inventory method, which account is not affected?

sales discounts

When processing the payment from a customer on an accounts receivable, the accountant needs all the following except:

sales invoice

Which of the following documents originates outside the company?

vendor invoice

Which of the following errors would not cause the trial balance to be out of balance?

failing to record a transaction

A remittance advice is used to:

pay or receive cash

The main source document which is used for recording a credit sale is:

sales invoice

Which of the following statements is false?

If perpetual inventory records have been historically accurate, a physical inventory count can be omitted in a given year.

Which of the following would an accountant most likely examine to determine the cost of inventory purchases during the year from a specific vendor?

accounts payable subsidiary ledger

Which transaction would not affect perpetual inventory records?

sales discounts taken

Which of the following transactions would not result in an entry to the accounts receivable subsidiary ledger?

recording the company’s provision for doubtful accounts