Listing All Bank Transfers Made a Few Days Before and After

question 9

Multiple Choice

Listing all bank transfers made a few days before and after the balance sheet date and tracing each to the accounting records for proper recording is a useful approach to test for:

• A) kiting.
• B) unintentional errors in recording bank transfers.
• C) both A and B.
• D) kiting and lapping.

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Definitions:

Price-earnings Ratio

A metric used in finance to compare a firm's present stock price with its earnings for each share.

Dividend Payout Ratio

A financial ratio that shows the percentage of a company's earnings paid out to shareholders as dividends.

Gross Margin Percentage

A profitability metric that measures how much of each dollar of revenue is left after deducting the costs of goods sold.

Net Profit Margin Percentage

A financial ratio that indicates the percentage of revenue that exceeds the costs associated with making and selling products or providing services.