actg 134 – ch2 part 2 – Flashcards

11) Data must be collected about three facets of each business activity. What are they? A) the business activity, the resources it affects, the people who participate B) the business activity, the transactions it creates, the impact on the financial statements C) the inputs, outputs and processes used D) who is involved, what was sold, how much was paid

12) The issuing of a purchase order is part of which transaction cycle? A) the revenue cycle B) the production cycle C) the human resources cycle D) the expenditure cycle

13) The collection of job time tickets or time sheets is part of which transaction cycle? A) revenue cycle B) production cycle C) human resources cycle D) expenditure cycle

14) Common source documents for the revenue cycle include all of the following except A) sales order. B) receiving report. C) delivery ticket. D) credit memo.

15) Which of the following documents would be found in the expenditure cycle? A) delivery ticket B) time card C) credit memo D) purchase order

16) Documents that are sent to customers or suppliers and then sent back to the company in the course of a business transaction are known as A) turnaround documents. B) source documents. C) source data automation. D) transaction documents.

17) Which of the following is an example of source data automation? A) a utility bill B) POS (point-of-sale) scanners in retail stores C) a bill of lading D) a subsidiary ledger

18) Pre-numbering of source documents helps to verify that A) all transactions have been recorded since the numerical sequence serves as a control. B) source data automation was used to capture data. C) documents have been used in order. D) company policies were followed.

19) Source documents generally help to improve accuracy in transaction processing because A) they specify which information to collect. B) logically related data can be grouped in the same area of the document. C) they provide directions and steps for completing the form. D) All of the above are correct.

20) When the sum of all entries in the subsidiary ledger equals the balance in the corresponding general ledger account, it is assumed that A) the recording processes were accurate. B) all source documents were recorded. C) adjusting entries are not required. D) no errors exist in the subsidiary ledger.