Let me go check in the back
When a count of inventory is taken near
year-end to make sure that the quantity of inventory reported in the financial statements is accurate
What is physical inventory
Cost flow is in the order in which the cost were incurred and the ending inventory is made up of the most recent purchases
What is FIFO
This act is one of the most important laws affecting US companies after discovery of financial scandals that caused stakeholders to lose billions of dollars
What is Sarbanes Oxley Act
A serious concern of internal control is the prevention of this
What is employee fraud
This includes coins, currency (paper money), checks, and money orders
What is cash
This authorizes the purchase of the inventory from an
approved vendor
What is a purchase order
Cost flow is an average of the costs and in ending inventory is a weighted average of the purchase costs
What is weighted average
Sarbanes-Oxley applies only to companies whose stock is traded on public exchanges, referred to as this
What is publicly held companies
Management should identify, analyze the significance, assess their likelihood of occurring, and take any necessary actions to minimize them is called this
What is risk assessment
The amount of cash on hand may differ from the amount of cash sales is called this
What is the cash short and over account
This provides a record of the amount of inventory available and helps keep inventory quantities at proper levels
What is a subsidiary inventory ledger
Cost flow is in the reverse order in which the costs were incurred and in ending inventory is a weighted average of the purchase costs
What is LIFO
This is defined as the procedures and processes used
by a company to safeguard assets, process information accurately, and ensure compliance with laws and regulations
What are internal controls
Observation of employee behavior and the
accounting system for indicators of control problems
What is monitoring
This is a set of procedures for authorizing and recording liabilities and cash payments
What is a voucher system
The following documents are often used for inventory control: purchase order, receiving report, and this
What is the vendor's invoice
The unit sold is identified with a unique purchase. The ending inventory is made up of the remaining units on hand
What is specific identification inventory cost flow method
After the passage of Sarbanes- Oxley, internal controls strengthened, stakeholders could rely on financial information, and fraud and theft was ____________
What is reduced?
Competent Personnel, Rotating Duties, and
Mandatory Vacations are examples of this
What are control procedures
This is an analysis of the items and amounts
creating the difference between the cash balance reported on the bank statement and the balance of the cash account in the ledger
What is a bank reconciliation
The two primary objectives of control over inventory
What is safeguarding and reporting
When identical units of merchandise are
acquired at different unit costs during a period, an accounting issue arises that is solved by this
What is inventory cost flow assumption
An evaluation tool for internal controls issued by the Committee of Sponsoring Organizations of the Treadway Commission
What is Internal Control—Integrated Framework
Management philosophy and operating style, organizational structure, and personnel policies are factors influencing this
What is a control environment
A company often has to pay small amounts for such items as postage, office supplies, or minor repairs. This special cash fund is called this
What is petty cash fund