Hi-1011-chapters 20 & 21- Accounting And Bookeeping/Banking Services Procedures

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  • 1/20 Questions

    Invoices should be checked for accuracy

    • True
    • False
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About This Quiz

This quiz covers key topics in accounting and bookkeeping, specifically for Chapters 20 & 21, focusing on procedures in banking services. It assesses understanding of financial summaries, error detection techniques, the use of petty cash, and the verification of invoices.

Hi-1011-chapters 20 & 21- Accounting And Bookeeping/Banking Services Procedures - Quiz

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  • 2. 

    Bookeeping is the daily recording process for accounting

    • True

    • False

    Correct Answer
    A. True
    Explanation
    Bookkeeping is indeed the daily recording process for accounting. It involves keeping track of financial transactions, such as income, expenses, and investments, in order to maintain accurate and up-to-date financial records. This process is crucial for businesses to monitor their financial health, make informed decisions, and fulfill legal requirements. Therefore, the statement "Bookeeping is the daily recording process for accounting" is true.

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  • 3. 

    Petty cash could be used to pay the mailman for postage due on a package

    • True

    • False

    Correct Answer
    A. True
    Explanation
    Petty cash is a small amount of cash kept on hand by a business for making small, everyday expenses. In this scenario, using petty cash to pay the mailman for postage due on a package is a valid use. Since the amount is small and relates to a regular business expense, it is appropriate to use petty cash for this purpose. Therefore, the given answer, "True," is correct.

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  • 4. 

    The federal reserve was desinged to provide the nation with a safer, more flexible, stable monetary and financial system

    • True

    • False

    Correct Answer
    A. True
    Explanation
    The statement is true because the Federal Reserve was indeed designed with the purpose of providing the nation with a safer, more flexible, stable monetary and financial system. The Federal Reserve acts as the central bank of the United States and is responsible for implementing monetary policies, supervising and regulating banks, and maintaining the stability of the financial system. Its primary objectives include promoting maximum employment, stable prices, and moderate long-term interest rates. By fulfilling these roles, the Federal Reserve aims to ensure the stability and smooth functioning of the economy.

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  • 5. 

    Online banking offers the convenience of banking 24/7 but still has deadlines for some financial transactions

    • True

    • False

    Correct Answer
    A. True
    Explanation
    Online banking provides the convenience of accessing banking services at any time, allowing customers to perform various financial transactions such as transferring funds, paying bills, and checking account balances. However, despite the round-the-clock availability, there are still certain deadlines associated with specific transactions. For example, transferring funds to another bank account may have a cut-off time after which the transaction will be processed on the next business day. Similarly, bill payments may have due dates, and if not made before the deadline, late fees or penalties may be incurred. Therefore, the statement that online banking has deadlines for some financial transactions is true.

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  • 6. 

    A money order can be purchased at a post office

    • True

    • False

    Correct Answer
    A. True
    Explanation
    A money order can be purchased at a post office because post offices offer this service to their customers. Money orders are a secure and convenient way to send money, and post offices are trusted institutions that provide this service to individuals who need to make payments or send money to others. By offering money orders, post offices ensure that individuals have a reliable and accessible option for conducting financial transactions.

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  • 7. 

    The fiscal year is a twelve month period of time that can start any month of the year.

    • True

    • False

    Correct Answer
    A. True
    Explanation
    The explanation for the given correct answer is that the fiscal year is indeed a twelve-month period of time that can start in any month of the year. Unlike the calendar year which always starts on January 1st and ends on December 31st, the fiscal year is used by businesses and organizations to determine their financial reporting and budgeting cycles. It allows them to align their financial activities with the specific needs and demands of their industry, rather than being restricted to a fixed calendar period. Therefore, the statement "The fiscal year is a twelve-month period of time that can start any month of the year" is true.

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  • 8. 

    Personal checking accounts and business accounts have the same benefits

    • True

    • False

    Correct Answer
    A. False
    Explanation
    Personal checking accounts and business accounts do not have the same benefits. Personal checking accounts are meant for individual use and typically offer benefits such as no monthly fees, low minimum balance requirements, and access to mobile banking. On the other hand, business accounts are designed for businesses and may come with features like payroll processing, merchant services, and business-specific perks. Therefore, the statement that personal checking accounts and business accounts have the same benefits is false.

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  • 9. 

    Which one of the following would not be entered on a financial summary

    • How much was earned

    • How much time was spent on procedures

    • How much money has been collected

    • How much money has been earned

    Correct Answer
    A. How much time was spent on procedures
    Explanation
    The question asks for something that would not be entered on a financial summary. A financial summary typically includes information related to money, such as earnings and collections. However, the amount of time spent on procedures is not directly related to financial matters and would not be included on a financial summary.

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  • 10. 

    An advantage of using checks is

    • The checking account protects the money while deposited

    • The checking account costs interest

    • Checks can be lost but not replaced

    • Checks are only useful for large payments

    Correct Answer
    A. The checking account protects the money while deposited
    Explanation
    Using checks provides the advantage of protecting the money while it is being deposited into the checking account. This means that the funds are secure and not at risk of being lost or stolen during the deposit process. Checks also provide a record of the transaction, making it easier to track and reconcile expenses. Additionally, checks offer a convenient way to make payments, whether they are large or small, without the need for carrying cash or making online transfers.

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  • 11. 

    A check could be returned because

    • It was written for too much money

    • It was missing information

    • The bank was closed for the holiday

    • The deposit slip was incorrect

    Correct Answer
    A. It was missing information
    Explanation
    A check could be returned if it is missing information because banks require all the necessary details to process a transaction. Missing information such as the date, payee, or signature can make the check invalid or suspicious, leading to its rejection. Banks need complete and accurate information to ensure the check can be properly verified and processed.

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  • 12. 

    When accepting checks you should

    • Only verify the amount to be accurate

    • Ask for a minimum of three pieces of identity

    • Allow a third party check to be signed over to the practice

    • Know the companies policies on accepting checks

    Correct Answer
    A. Know the companies policies on accepting checks
    Explanation
    The correct answer is to know the company's policies on accepting checks. This is important because every company may have different rules and guidelines regarding accepting checks. By knowing the company's policies, you can ensure that you are following the correct procedures and avoiding any potential issues or mistakes. It also helps in maintaining consistency and professionalism in handling check transactions.

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  • 13. 

    When the bank uses your money they charge interest to the account

    • True

    • False

    Correct Answer
    A. False
    Explanation
    The statement "When the bank uses your money they charge interest to the account" is false. Banks do not charge interest to the account when they use your money. Instead, banks pay interest to account holders for keeping their money in the bank. This interest is a way for the bank to compensate the account holders for the use of their funds.

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  • 14. 

    What are the two methods of accounting

    • Cash basis and Actual basis

    • Charge basis and Account basis

    • Cash basis and Accrual basis

    • Charge basis and Actual basis

    Correct Answer
    A. Cash basis and Accrual basis
    Explanation
    The two methods of accounting are cash basis and accrual basis. Cash basis accounting records revenue and expenses when cash is received or paid, respectively. This method is simple and straightforward but may not accurately reflect the financial position of a company. Accrual basis accounting, on the other hand, records revenue and expenses when they are earned or incurred, regardless of when cash is received or paid. This method provides a more accurate representation of a company's financial position but requires more complexity in tracking transactions.

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  • 15. 

    A technique for finding an error could be

    • Just recalculate everything

    • Delete all entries and re-enter

    • Use a fresh set of eyes

    • Adjust the figures to balance

    Correct Answer
    A. Use a fresh set of eyes
    Explanation
    Using a fresh set of eyes is a technique for finding an error because it involves having someone else review the work or problem. This person, who has not been previously involved in the process, can provide a new perspective and potentially spot mistakes or inconsistencies that may have been overlooked. By bringing in someone with a fresh perspective, it increases the chances of identifying errors and finding a solution.

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  • 16. 

    Cash Flow statement lists the amount of money owed to the practice

    • True

    • False

    Correct Answer
    A. False
    Explanation
    The cash flow statement does not list the amount of money owed to the practice. It provides information about the inflows and outflows of cash during a specific period, including operating activities, investing activities, and financing activities. The statement focuses on cash movements and does not specifically address amounts owed to the practice. Therefore, the given statement is false.

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  • 17. 

    A disbursement journal is commonly known as a checking account

    • True

    • False

    Correct Answer
    A. False
    Explanation
    A disbursement journal is not commonly known as a checking account. A disbursement journal is a record that tracks all the payments made by a company, while a checking account is a bank account used for depositing and withdrawing funds. These two terms refer to different aspects of financial management and are not interchangeable.

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  • 18. 

    This is not a type of accounting system

    • Single entry

    • Double entry

    • Duplicate entry

    • Write it once

    Correct Answer
    A. Duplicate entry
    Explanation
    Duplicate entry is not a type of an accounting system.

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  • 19. 

    This would not be a good tecnique for paying bills

    • Pay at a designated time of the month

    • Have a routine organized system

    • Pay when the bill comes in

    • Look for special terms that offer discounts if paid within a specific period of time

    Correct Answer
    A. Pay when the bill comes in
    Explanation
    It is not a good bill paying technique to pay bills when they come in.

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  • 20. 

    The payer is the person who writes the check

    • True

    • False

    Correct Answer
    A. False
    Explanation
    False. The payor is who the check comes from and the drawer is who writes the check.

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Quiz Review Timeline (Updated): Mar 20, 2023 +

Our quizzes are rigorously reviewed, monitored and continuously updated by our expert board to maintain accuracy, relevance, and timeliness.

  • Current Version
  • Mar 20, 2023
    Quiz Edited by
    ProProfs Editorial Team
  • Apr 05, 2012
    Quiz Created by
    Dhardma1
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