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Match the Following Terms with the Appropriate Definition

Question 227

Matching

Match the following terms with the appropriate definition.

Premises:

Responses:

Cash equivalent

Regulation requiring public companies to document and certify their system of internal controls.

Cost-benefit principle

Short-term, highly liquid investments that are readily convertible to a known cash amount and are sufficiently close to their maturity date so that the market value is not sensitive to interest rate changes.

Internal control system

Set of procedures and approvals designed to control cash payments.

Sarbanes-Oxley Act

An asset such as cash that can be readily used to settle near-term obligations.

Liquid assets

The organization that lists five ingredients of internal controls that adds to the quality of accounting information.

Cash

Internal document used to collect information to control cash payments and to ensure that a transaction is properly recorded.

Canceled checks

The set of policies and procedures managers use to monitor and control business activities.

Committee of Sponsoring Organizations

Currency, coins, and amounts on deposit in bank accounts.

Voucher

Principle that costs of internal controls must not exceed their benefits.

Voucher system

Checks the bank has paid and deducted from a customer's account.

Premises:

Cash equivalent

Cost-benefit principle

Internal control system

Sarbanes-Oxley Act

Liquid assets

Cash

Canceled checks

Committee of Sponsoring Organizations

Voucher

Voucher system

Responses:

Regulation requiring public companies to document and certify their system of internal controls.

Set of procedures and approvals designed to control cash payments.

An asset such as cash that can be readily used to settle near-term obligations.

The organization that lists five ingredients of internal controls that adds to the quality of accounting information.

Internal document used to collect information to control cash payments and to ensure that a transaction is properly recorded.

The set of policies and procedures managers use to monitor and control business activities.

Currency, coins, and amounts on deposit in bank accounts.

Principle that costs of internal controls must not exceed their benefits.

Checks the bank has paid and deducted from a customer's account.

Correct Answer:

Premises:

Responses:

Cash equivalent

Cost-benefit principle

Internal control system

Sarbanes-Oxley Act

Liquid assets

Cash

Canceled checks

Committee of Sponsoring Organizations

Voucher

Voucher system

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