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ACC 556- Midterm part 1
· Question 1 Source documents can provide evidence that a transaction has occurre d
· Question 2 Expense recognition is tied to revenue recognition.
· Question 3 To obtain maximum benefit from a bank reconciliation, the reconciliat ion should be prepared by the employee authorized to sign checks.
· Question 4 An aging of accounts receivable schedule is based on the premise that the longer the period an account remains unpaid, the greater the prob ability that it will eventually be collected.
· Question 5 A concentration of credit risk is a threat of nonpayment from a single customer or class of customers that could adversely affect the financial health of the company.
· Question 6 Which of the following is not a common way that managers use the ba lance sheet?
· Question 7 Financing activities include the purchase or sale of longlived assets or the purchase or sale of investment securities.