The statement of cash flows reports cash flows from the activities of:

A) Operating, purchasing, and investing.

B) Borrowing, paying, and investing.

C) Financing, investing, and operating.

D) Using, investing, and financing.

Answer: Financing, investing, and operating.

A common example of restricted cash includes cash set aside by the company for the specific purpose of:

A) Repaying debt in the future.

B) Purchasing equipment in the future.

C) Making investments in the future.

D) All of the other answers represent examples of restricted cash.

Answer: All of the other answers represent examples of restricted cash.

Which of the following best describes restricted cash?

A) Cash to be collected from customers from sales on account.

B) Cash that is not available to be used for current operations.

C) Cash that has been borrowed from a bank with a high interest rate.

D) Dividends that are expected to be paid to common stockholders in the following year.

Answer: Cash that is not available to be used for current operations.

A company's cash balance is reported in which two financial statements?

A) Income statement and statement of cash flows.

B) Balance sheet and statement of cash flows.

C) Income statement and balance sheet.

D) Balance sheet and statement of stockholders' equity.

Answer: Balance sheet and statement of cash flows.

When accounting for employee purchases, effective internal controls could include which of the following?

A) Employees should be required to provide receipts and justification for those receipts every six months.

B) Only those employees that need to make timely business expenditures should receive authorization.

C) The same employee should review receipts and supporting documents to ensure all expenditures are made appropriately.

D) To ensure timely expenditures, no pre-approval should be required for major purchases.

Answer: Only those employees that need to make timely business expenditures should receive authorization.

When accounting for employee purchases, effective internal controls could include which of the following?

A) Credit card receipts are reconciled to credit card statements.

B) Employees should be required to provide receipts and justification for those receipts on a timely basis.

C) A separate employee reviews receipts and supporting documents to ensure all expenditures are made appropriately.

D) All of the other answers represent effective internal controls.

Answer: All of the other answers represent effective internal controls.

Which of the following is correct regarding a petty cash fund?

A) A petty cash fund represents cash on hand at the business for quick access.

B) A petty cash fund is used for minor purposes.

C) When cash from this fund is taken out, it should be replaced with a voucher.

D) All of the answers are correct regarding a petty cash fund.

Answer: All of the answers are correct regarding a petty cash fund.