ACC 556- Midterm part 1
· Question 1
Source documents can provide evidence that a transaction has occurred
· Question 2 Expense recognition is tied to revenue recognition.
· Question 3
To obtain maximum benefit from a bank reconciliation, the reconciliation 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 probability 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 balance sheet?
· Question 7
Financing activities include the purchase or sale of long-lived assets or the purchase or sale of investment securities.