Question 1

Asset disposal

Accepted Answer

A)   occurs as soon as an asset is fully depreciated
B)   requires no special authorization
C)   automatically initiates the purchase of a replacement asset
D)   must follow formal authorization proceduresE) B) and C)
F) None of the above

Question 2

In the payroll subsystem,which function should distribute paychecks?

Accepted Answer

A)   personnel
B)   timekeeping
C)   paymaster
D)   payrollE) A) and D)
F) None of the above

Question 3

Employee paychecks should be drawn against a special checking account.

Accepted Answer

A) True 
 B)False

Question 4

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 cashE) C) and D)
F) B) and C)

Question 5

The personnel action form provides authorization control by

Accepted Answer

A)   preventing paychecks for terminated employees
B)   verifying pay rates for employees
C)   informing payroll of new hires
D)   all of the aboveE) A) and B)
F) B) and C)

Question 6

Describe an internal control that would prevent an employee from stealing a computer and then reporting it as scrapped.

Accepted Answer

Supervisors must authorize the...

Question 7

In a manufacturing firm,employees use time cards and job tickets.Which of the following statements is not correct?

Accepted Answer

A)   Job tickets are prepared by employees for each job worked on,so an employee may have more that one job ticket on a given day.
B)   An individual employee will have only one time card.
C)   The time reported on job tickets should reconcile with the time reported on time cards.
D)   Paychecks should be prepared from the job tickets.E) B) and D)
F) All of the above

Question 8

Describe an internal control that would prevent the charging of depreciation expense to the maintenance department for a sweeper that is now located in and used by the engineering department.

Accepted Answer

Prepare reports about the transfer of fi...

Question 9

Describe how the Fixed Asset System differs from the expenditure cycle.

Accepted Answer

The Fixed Asset System processes nonrout...

Question 10

Why does the payroll process lend itself to batch processing?

Accepted Answer

Payroll lends itself to batch processing...

Question 11

The Fixed Asset Systems does all of the following except

Accepted Answer

A)   records acquisition of assets
B)   records improvements to assets
C)   estimates the fair market value of assets in service
D)   records the disposal of assetsE) All of the above
F) None of the above

Question 12

Which control is not a part of the Fixed Asset System?

Accepted Answer

A)   formal analysis of the purchase request
B)   review of the assumptions used in the capital budgeting model
C)   development of an economic order quantity model
D)   estimates of anticipated cost savingsE) None of the above
F) B) and C)

Question 13

Fixed Asset Systems must keep track of the physical location of each asset to promote accountability.

Accepted Answer

A) True 
 B)False

Question 14

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

Accepted Answer

A) True 
 B)False

Question 15

What negative consequences result when fixed asset records include assets that are no longer owned by the firm?

Accepted Answer

On the financial statements,assets will ...

Question 16

How do Fixed Asset Systems differ from the expenditure cycle?

Accepted Answer

The fixed asset system processes nonrout...

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

The payroll department performs all of the following except

Accepted Answer

A)   prepares paychecks
B)   transfers adequate funds to the payroll imprest account
C)   updates employee payroll records
D)   prepares the payroll registerE) A) and B)
F) A) and C)

Question 19

Work centers provide the personnel action form,which triggers the payroll process.

Accepted Answer

A) True 
 B)False

Question 20

The personnel department authorizes changes in employee pay rates.

Accepted Answer

A) True 
 B)False

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

Why does the payroll process lend itself to batch processing?

Correct AnswerverifiedPayroll lends itself to batch processing...View AnswerShow Answer

Payroll checks are typically drawn on

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The personnel action form provides authorization control by

Correct AnswerverifiedShow Answer

Fixed Asset Systems must keep track of the physical location of each asset to promote accountability.

Correct AnswerverifiedShow Answer

In a manufacturing firm,employees use time cards and job tickets.Which of the following statements is not correct?

Correct AnswerverifiedShow Answer

The personnel department authorizes changes in employee pay rates.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which control is not a part of the Fixed Asset System?

Correct AnswerverifiedShow Answer

Asset disposal

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Describe an internal control that would prevent an employee from stealing a computer and then reporting it as scrapped.

Correct AnswerverifiedSupervisors must authorize the...View AnswerShow Answer

The Fixed Asset Systems does all of the following except

Correct AnswerverifiedShow Answer

How do Fixed Asset Systems differ from the expenditure cycle?

Correct AnswerverifiedThe fixed asset system processes nonrout...View AnswerShow Answer

In the payroll subsystem,which function should distribute paychecks?

Correct AnswerverifiedShow Answer

The payroll department performs all of the following except

Correct AnswerverifiedShow Answer

What negative consequences result when fixed asset records include assets that are no longer owned by the firm?

Correct AnswerverifiedOn the financial statements,assets will ...View AnswerShow Answer

Describe how the Fixed Asset System differs from the expenditure cycle.

Correct AnswerverifiedThe Fixed Asset System processes nonrout...View AnswerShow Answer

Work centers provide the personnel action form,which triggers the payroll process.

Correct AnswerverifiedShow Answer

Describe an internal control that would prevent the charging of depreciation expense to the maintenance department for a sweeper that is now located in and used by the engineering department.

Correct AnswerverifiedPrepare reports about the transfer of fi...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

Employee paychecks should be drawn against a special checking account.

Correct AnswerverifiedShow Answer

Correct Answer
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Payroll lends itself to batch processing...
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Supervisors must authorize the...
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Correct Answer
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Correct Answer
verified
The fixed asset system processes nonrout...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
On the financial statements,assets will ...
View Answer

Correct Answer
verified
The Fixed Asset System processes nonrout...
View Answer

Correct Answer
verified

Correct Answer
verified
Prepare reports about the transfer of fi...
View Answer

Correct Answer
verified

Correct Answer
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