Question

question 4 (5 points)
the credit side is always the left side of the account.
true
false

question 5 (5 points)
internal control over a companys assets should not include the following
procedures:
responsibilities and duties of employees will be divided.
all cash receipts will be accumulated until significant enough for a major deposit.
all cash payments will be made by check (except petty cash).
all of these answers are correct.

question 6 (5 points)
a maximum earnings limit is set for all fica taxes.
true
false

question 7 (5 points)
fica taxes are levied only on employees.
true
false

Explanation:

• Question 4: In accounting, the credit side is the right side of the account, while the debit side is the left side.
• Question 5: Internal control over assets should include dividing responsibilities (segregation of duties), making cash payments by check (except petty cash) for better traceability. Accumulating cash receipts until a major deposit is not a good internal - control practice as it increases the risk of theft or misappropriation.
• Question 6: There is a maximum earnings limit for Social Security (a part of FICA), but not for Medicare (another part of FICA). So, it is false to say a maximum earnings limit is set for all FICA taxes.
• Question 7: FICA taxes are levied on both employees and employers. Employers are required to match the FICA contributions of their employees.

Answer:

• Question 4: B. False
• Question 5: All cash receipts will be accumulated until significant enough for a major deposit.
• Question 6: B. False
• Question 7: B. False