Accounting test 2: chapters 4, 5, 6
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The use of one's occupation for personal enrichment through the deliberate misuse or misapplication of the employers resources
3 elements that are present for every fraud that occurs are commonly referred to as:
- 1. motive
- 2. rationalization
- 3. opportunity
the fraud triangle
This method helps maintain control of cash, a ___________ matches the balance of cash in the bank account with the balance of cash in the company's own records
Differences in a bank statement and a companys books most often occurs because of either __________ or ________
3 steps in reconciling the bank account
- 1. adjust the banks cash balance
- 2. adjust companys cash balance
- 3. update the companys cash account
Cash receipts of the company that have not been added to the banks record of the companys balance
Checks the company has written that have not been subtracted from the banks record of the companys balance
Customers checks written on "non sufficient funds", otherwise known as "bad" checks
NSF checks will go into which account?
To pay for minor purchases a company will keep a small amount of cash on hand in a __________
petty cash fund
This account represents the amount of cash owed to a company by its customer from the sale of products or services on account
These transactions transfer products and services to a customer today while bearing the risk of collecting payment from that customer in the future.
credit sales, sales on account, services on account
When does the company record revenue on a credit sale?
the firm records revenue immediately, as long as future collection from the customer is reasonably certain
Refer to a companys total revenues less any amounts for discounts, returns and allowances
______ represent a reduction in the listed price of a product or service
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