Reference no: EM132782231

Problem 1: Which of the following statement is not correct?

A. Employees who approve the payment should not also prepare cheques

B. Control relies heavily on separation of record keeping and custodianship

C. Making all payments by electronic transfer or by cheques is necessary for a good internal control system.

D. All of the statements are correct.

Problem 2: When the petty cash imprest system is established:

A. the bank account is debited.

B. the petty cash account is credited.

C. the bank account is debited and the petty cash account is credited.

D. the bank account is credited and the petty cash account is debited.

Problem 3:  ABC Books has a petty cash imprest of $200. Expenses from petty cash were stationery $110; travel $22; coffee, tea, milk etc. $18; postage $25. If the petty cash is reimbursed, the cheque for reimbursement would be drawn up for:

A. $ 25.

B. $200.

C. $175.

D. $159.