Bookkeeping Certification — Practice Exam
Internal control and errors: practice questions
Our Bookkeeping bank has 14 questions on this topic. Here are 4 of them with answers; the full mock exam draws from every topic, like the real one.
Question 1
Why should the person who reconciles the bank account not also write checks?
- To reduce the risk of undetected fraud or errors
- To save paper
- Because it is faster
- Because banks require it before they will open a business checking account
Show the answer
A. To reduce the risk of undetected fraud or errors — This is segregation of duties.
Question 2
What is 'lapping'?
- Hiding stolen cash by applying one customer's payment to another's account
- Depreciating twice
- Recording sales twice
- Running two shifts
Show the answer
A. Hiding stolen cash by applying one customer's payment to another's account — Rotating duties and mandatory vacations help detect it.
Question 3
What is a 'slide' error?
- Reversing two digits
- Omitting an entry
- A misplaced decimal point, such as $1,250 recorded as $125
- Posting an amount to the wrong account in the general ledger
Show the answer
C. A misplaced decimal point, such as $1,250 recorded as $125 — Differences from slides are divisible by 9.
Question 4
What is an audit trail?
- A path in an office
- Documentation that lets each transaction be traced from source document to the financial statements
- A tax audit
- A list of auditors
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B. Documentation that lets each transaction be traced from source document to the financial statements — Good audit trails support accuracy and control.