Question 1

Outline the key steps taken in a payroll system that deals with hourly workers who are paid once each week.

Accepted Answer

Work centers monitor employee time and provide employee time cards each week to the payroll department.
The personnel department prepares a personnel action form to the payroll department.This document identifies valid employees and reflects changes in their payroll status.
The payroll department calculates the payroll,prepares paychecks for the employees,updates the employee records,and prepares a payroll register.The paychecks are sent to the paymaster who distributes the checks to the employee or they may be deposited directly into the employees' accounts.The payroll register is sent to Accounts Payable.
Accounts payable reviews the payroll register and authorizes cash disbursements to issue a single check for the entire payroll,which is deposited into the payroll impressed account at the banks.
The general ledger department receives a journal voucher from cash disbursements and a disbursement voucher from AP.

Question 2

Payroll uses time card data to do all of the following except

Accepted Answer

A)  prepare the payroll register 
B)  update employee payroll records 
C)  prepare the labor distribution summary 
D)  prepare paychecks 
A)  prepare the payroll register 
B)  update employee payroll records 
C)  prepare the labor distribution summary 
D)  prepare paychecks C

Question 3

The depreciation schedule shows when assets are fully depreciated.

Accepted Answer

A) True 
 B)False  True

Question 4

Discuss the fundamental risk and control issues associated with fixed assets that are different from raw materials and finished goods.

Accepted Answer

AUTHORIZATION CONTROLS.Because fixed ass

Question 5

Authorization to dispose of fixed assets should be issued by the user of the asset.

Accepted Answer

A) True 
 B)False

Question 6

Most payroll systems for mid-size firms use real-time data processing.

Accepted Answer

A) True 
 B)False

Question 7

Describe an internal control that would prevent the payment of insurance premiums on an automobile that is no longer owned by the company.

Accepted Answer

Perform an annual physical inv

Question 8

Work-in-process records are updated by payroll personnel.

Accepted Answer

A) True 
 B)False

Question 9

Accounting conventions and IRS rules sometime specify the depreciation parameters to be used.

Accepted Answer

A) True 
 B)False

Question 10

Time cards capture the total time an individual worker spends on each production job.

Accepted Answer

A) True 
 B)False

Question 11

An important reconciliation in the payroll system is

Accepted Answer

A)  general ledger compares the labor distribution summary from cost accounting to the disbursement voucher from accounts payable 
B)  personnel compares the number of employees authorized to receive a paycheck to the number of paychecks prepared 
C)  production compares the number of hours reported on job tickets to the number of hours reported on time cards 
D)  payroll compares the labor distribution summary to the hours reported on time cards 
A)  general ledger compares the labor distribution summary from cost accounting to the disbursement voucher from accounts payable 
B)  personnel compares the number of employees authorized to receive a paycheck to the number of paychecks prepared 
C)  production compares the number of hours reported on job tickets to the number of hours reported on time cards 
D)  payroll compares the labor distribution summary to the hours reported on time cards

Question 12

Employee paychecks should be drawn against a special checking account.

Accepted Answer

A) True 
 B)False

Question 13

Why would an organization require the paymaster to deliver all unclaimed paychecks to the internal audit department?

Accepted Answer

A)  to detect a "phantom employee" for whom a check was produced 
B)  to prevent an absent employee's check from being lost 
C)  to avoid paying absent employees for payday 
D)  to prevent the paymaster from cashing unclaimed checks 
A)  to detect a "phantom employee" for whom a check was produced 
B)  to prevent an absent employee's check from being lost 
C)  to avoid paying absent employees for payday 
D)  to prevent the paymaster from cashing unclaimed checks

Question 14

The personnel department authorizes changes in employee pay rates.

Accepted Answer

A) True 
 B)False

Question 15

Objectives of the Fixed Asset System do not include

Accepted Answer

A)  authorizing the acquisition of fixed assets 
B)  recording depreciation expense 
C)  computing gain and/or loss on disposal of fixed assets 
D)  maintaining a record of the fair market value of all fixed assets 
A)  authorizing the acquisition of fixed assets 
B)  recording depreciation expense 
C)  computing gain and/or loss on disposal of fixed assets 
D)  maintaining a record of the fair market value of all fixed assets

Question 16

List two types of authorization required in the Fixed Asset System.

Accepted Answer

authorization to pur

Question 17

How are the following carried out in the Fixed Asset System: authorization,supervision,independent verification?

Accepted Answer

Independent authorization is required to

Question 18

The Fixed Asset System is similar to the expenditure cycle except

Accepted Answer

A)  fixed asset transactions are non-routine and require special authorization and controls 
B)  fixed assets are capitalized, not expensed 
C)  both a and b 
D)  none of the above 
A)  fixed asset transactions are non-routine and require special authorization and controls 
B)  fixed assets are capitalized, not expensed 
C)  both a and b 
D)  none of the above

Question 19

Cost accounting updates work-in-process accounts from

Accepted Answer

A)  time cards 
B)  the labor distribution summary 
C)  job tickets 
D)  personnel action forms 
A)  time cards 
B)  the labor distribution summary 
C)  job tickets 
D)  personnel action forms

Question 20

Why should employees clocking on and off the job be supervised?

Accepted Answer

A form of payroll fraud involv

Outline the key steps taken in a payroll system that deals with hourly workers who are paid once each week.

Payroll uses time card data to do all of the following except

The depreciation schedule shows when assets are fully depreciated.

Discuss the fundamental risk and control issues associated with fixed assets that are different from raw materials and finished goods.

Authorization to dispose of fixed assets should be issued by the user of the asset.

Most payroll systems for mid-size firms use real-time data processing.

Describe an internal control that would prevent the payment of insurance premiums on an automobile that is no longer owned by the company.

Work-in-process records are updated by payroll personnel.

Accounting conventions and IRS rules sometime specify the depreciation parameters to be used.

Time cards capture the total time an individual worker spends on each production job.

An important reconciliation in the payroll system is

Employee paychecks should be drawn against a special checking account.

Why would an organization require the paymaster to deliver all unclaimed paychecks to the internal audit department?

The personnel department authorizes changes in employee pay rates.

Objectives of the Fixed Asset System do not include

List two types of authorization required in the Fixed Asset System.

How are the following carried out in the Fixed Asset System: authorization,supervision,independent verification?

The Fixed Asset System is similar to the expenditure cycle except

Cost accounting updates work-in-process accounts from

Why should employees clocking on and off the job be supervised?

The Information System: An Accountant’s Perspective

Introduction to Transaction Processing

Ethics, Fraud, and Internal Control

The Revenue Cycle

The Expenditure Cycle Part I: Purchases and Cash Disbursements Procedures

The Conversion Cycle

General Ledger, Financial Reporting, and Management Reporting Systems

Database Management Systems

The REA Approach to Business Process Modeling

Enterprise Resource Planning Systems

Electronic Commerce Systems

Managing the Systems Development Life Cycle

Construct, Deliver, and Maintain Systems Projects

IT Controls : Sarbanes-Oxley and IT Governance

IT Controls : Security and Access

IT Controls : Systems Development Program Changes and Application Controls

Filters

Exam 6: The Expenditure Cycle Part II: Payroll Processing and Fixed Asset Procedures

Outline the key steps taken in a payroll system that deals with hourly workers who are paid once each week.

Payroll uses time card data to do all of the following except

The depreciation schedule shows when assets are fully depreciated.

Discuss the fundamental risk and control issues associated with fixed assets that are different from raw materials and finished goods.

Authorization to dispose of fixed assets should be issued by the user of the asset.

Most payroll systems for mid-size firms use real-time data processing.

Describe an internal control that would prevent the payment of insurance premiums on an automobile that is no longer owned by the company.

Work-in-process records are updated by payroll personnel.

Accounting conventions and IRS rules sometime specify the depreciation parameters to be used.

Time cards capture the total time an individual worker spends on each production job.

An important reconciliation in the payroll system is

Employee paychecks should be drawn against a special checking account.

Why would an organization require the paymaster to deliver all unclaimed paychecks to the internal audit department?

The personnel department authorizes changes in employee pay rates.

Objectives of the Fixed Asset System do not include

List two types of authorization required in the Fixed Asset System.

How are the following carried out in the Fixed Asset System: authorization,supervision,independent verification?

The Fixed Asset System is similar to the expenditure cycle except

Cost accounting updates work-in-process accounts from

Why should employees clocking on and off the job be supervised?

The Information System: An Accountant’s Perspective

Introduction to Transaction Processing

Ethics, Fraud, and Internal Control

The Revenue Cycle

The Expenditure Cycle Part I: Purchases and Cash Disbursements Procedures

The Conversion Cycle

General Ledger, Financial Reporting, and Management Reporting Systems

Database Management Systems

The REA Approach to Business Process Modeling

Enterprise Resource Planning Systems

Electronic Commerce Systems

Managing the Systems Development Life Cycle

Construct, Deliver, and Maintain Systems Projects

IT Controls : Sarbanes-Oxley and IT Governance

IT Controls : Security and Access

IT Controls : Systems Development Program Changes and Application Controls

Filters