Question 1

If a company uses a standard cost system, inventory records can be updated from the

Accepted Answer

A)  vendor invoice 
B)  purchase order 
C)  receiving report 
D)  purchase requisition 
A)  vendor invoice 
B)  purchase order 
C)  receiving report 
D)  purchase requisition

Question 2

The cash disbursement clerk performs all of the following tasks except

Accepted Answer

A)  reviews the supporting documents for completeness and accuracy 
B)  prepares checks 
C)  signs checks 
D)  marks the supporting documents paid 
A)  reviews the supporting documents for completeness and accuracy 
B)  prepares checks 
C)  signs checks 
D)  marks the supporting documents paid

Question 3

What is the principle objective of the cash disbursement system?

Accepted Answer

The principal objective of this system i

Question 4

In a computerized system that uses an economic order quantity (EOQ) model and the perpetual inventory method, who determines when to reorder inventory?

Accepted Answer

A)  the inventory control clerk 
B)  the purchasing department 
C)  the vendor 
D)  the computer system 
A)  the inventory control clerk 
B)  the purchasing department 
C)  the vendor 
D)  the computer system

Question 5

In a real-time processing system with a high number of transactions, the best and most practical control over cash disbursements is to have

Accepted Answer

A)  all checks manually signed by the treasurer 
B)  all checks signed by check-signing equipment 
C)  checks over a certain dollar amount manually signed by the treasurer 
D)  checks over a certain dollar amount manually signed by the cash disbursements clerk 
A)  all checks manually signed by the treasurer 
B)  all checks signed by check-signing equipment 
C)  checks over a certain dollar amount manually signed by the treasurer 
D)  checks over a certain dollar amount manually signed by the cash disbursements clerk

Question 6

In non-manufacturing firms, purchasing decisions are authorized by inventory control.

Accepted Answer

A) True 
 B)False

Question 7

In a voucher system, the sum of all unpaid vouchers in the voucher register equals the firm's total voucher payable balance.

Accepted Answer

A) True 
 B)False

Question 8

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 9

The Soap Manufacturing Company has three employees who work in the warehouse. All of the warehouse workers are authorized to order inventory when it falls below the reorder level. The workers complete a purchase order and mail it to the supplier of their choice. The inventory is delivered directly to the warehouse. The workers send a memo to accounts payable reporting the receipt of inventory.
Accounts payable compares the warehouse memo to the supplier's invoice. Accounts payable prepares a check which the treasurer signs.
Describe at least five needed internal control improvements.

Accepted Answer

The warehouse workers should prepare a p

Question 10

When goods are received, the receiving clerk sends copies of the receiving report to the inventory control clerk and the AP clerk.

Accepted Answer

A) True 
 B)False

Question 11

In a merchandising firm, authorization for the purchase of inventory is the responsibility of

Accepted Answer

A)  inventory control 
B)  purchasing 
C)  accounts payable 
D)  cash disbursements 
A)  inventory control 
B)  purchasing 
C)  accounts payable 
D)  cash disbursements

Question 12

Where is access control exercised in the purchasing/cash disbursement functions?

Accepted Answer

physical control of inventory

Question 13

Permitting warehouse staff to maintain the only inventory records violates separation of duties.

Accepted Answer

A) True 
 B)False

Question 14

All of the following departments have a copy of the purchase order except

Accepted Answer

A)  the purchasing department 
B)  the receiving department 
C)  accounts payable 
D)  general ledger 
A)  the purchasing department 
B)  the receiving department 
C)  accounts payable 
D)  general ledger

Question 15

The documents in a voucher packet include all of the following except

Accepted Answer

A)  a check 
B)  a purchase order 
C)  a receiving report 
D)  a supplier's invoice 
A)  a check 
B)  a purchase order 
C)  a receiving report 
D)  a supplier's invoice

Question 16

Firms that wish to improve control over cash disbursements use a voucher system.

Accepted Answer

A) True 
 B)False

Question 17

A three way match involves a purchase order, a purchase requisition, and an invoice.

Accepted Answer

A) True 
 B)False

Question 18

How does a voucher payable system work? What documents are reconciled? Who prepares the voucher? How is the A/P balance determined? How does the voucher payable system improve control over cash?

Accepted Answer

In place of a standard accounts payable

Question 19

Payroll checks are typically drawn on

Accepted Answer

A)  the regular checking account 
B)  a payroll imprest account 
C)  a wages payable account 
D)  petty cash 
A)  the regular checking account 
B)  a payroll imprest account 
C)  a wages payable account 
D)  petty cash

Question 20

Payroll processing can be automated easily because accounting for payroll is very simple.

Accepted Answer

A) True 
 B)False

If a company uses a standard cost system, inventory records can be updated from the

The cash disbursement clerk performs all of the following tasks except

What is the principle objective of the cash disbursement system?

In a computerized system that uses an economic order quantity (EOQ) model and the perpetual inventory method, who determines when to reorder inventory?

In a real-time processing system with a high number of transactions, the best and most practical control over cash disbursements is to have

In non-manufacturing firms, purchasing decisions are authorized by inventory control.

In a voucher system, the sum of all unpaid vouchers in the voucher register equals the firm's total voucher payable balance.

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

When goods are received, the receiving clerk sends copies of the receiving report to the inventory control clerk and the AP clerk.

In a merchandising firm, authorization for the purchase of inventory is the responsibility of

Where is access control exercised in the purchasing/cash disbursement functions?

Permitting warehouse staff to maintain the only inventory records violates separation of duties.

All of the following departments have a copy of the purchase order except

The documents in a voucher packet include all of the following except

Firms that wish to improve control over cash disbursements use a voucher system.

A three way match involves a purchase order, a purchase requisition, and an invoice.

How does a voucher payable system work? What documents are reconciled? Who prepares the voucher? How is the A/P balance determined? How does the voucher payable system improve control over cash?

Payroll checks are typically drawn on

Payroll processing can be automated easily because accounting for payroll is very simple.

Auditing and Internal Control

Auditing IT Governance Controls

Auditing Operating Systems and Networks

Auditing Database Systems

Systems Development and Program Change Activities

Transaction Processing and Financial Reporting Systems Overview

Computer Assisted Audit Tools and Techniques

Data Structures and Caatts for Data Extraction

Auditing the Revenue Cycle

Enterprise Resource Planning Systems

Business Ethics, Fraud, and Fraud Detection

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Exam 10: Auditing the Expenditure Cycle

If a company uses a standard cost system, inventory records can be updated from the

The cash disbursement clerk performs all of the following tasks except

What is the principle objective of the cash disbursement system?

In a computerized system that uses an economic order quantity (EOQ) model and the perpetual inventory method, who determines when to reorder inventory?

In a real-time processing system with a high number of transactions, the best and most practical control over cash disbursements is to have

In non-manufacturing firms, purchasing decisions are authorized by inventory control.

In a voucher system, the sum of all unpaid vouchers in the voucher register equals the firm's total voucher payable balance.

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

When goods are received, the receiving clerk sends copies of the receiving report to the inventory control clerk and the AP clerk.

In a merchandising firm, authorization for the purchase of inventory is the responsibility of

Where is access control exercised in the purchasing/cash disbursement functions?

Permitting warehouse staff to maintain the only inventory records violates separation of duties.

All of the following departments have a copy of the purchase order except

The documents in a voucher packet include all of the following except

Firms that wish to improve control over cash disbursements use a voucher system.

A three way match involves a purchase order, a purchase requisition, and an invoice.

How does a voucher payable system work? What documents are reconciled? Who prepares the voucher? How is the A/P balance determined? How does the voucher payable system improve control over cash?

Payroll checks are typically drawn on

Payroll processing can be automated easily because accounting for payroll is very simple.

Auditing and Internal Control

Auditing IT Governance Controls

Auditing Operating Systems and Networks

Auditing Database Systems

Systems Development and Program Change Activities

Transaction Processing and Financial Reporting Systems Overview

Computer Assisted Audit Tools and Techniques

Data Structures and Caatts for Data Extraction

Auditing the Revenue Cycle

Enterprise Resource Planning Systems

Business Ethics, Fraud, and Fraud Detection

Filters