Chapter 15 Solution Manual Accounting Information Systems PDF

Accounting Information Systems, 13e (Romney/Steinbart)
Chapter 15 The Human Resources Management and Payroll Cycle
15.1 Describe the major business activities and related information processing operations
performed in the human resources management (HRM)/payroll cycle.
1) Which activity below is not performed by Human Resources management (HRM)?

A) compensation
B) training
C) discharge
D) recruitment and hiring
Answer: A
Objective: Learning Objective 1
Difficulty: Easy
AACSB: Analytic
2) Which department should have the sole ability to provide information to the AIS about hiring,
terminations, and pay rate changes?
A) payroll
B) timekeeping
C) production
D) HRM
Answer: D
Difficulty: Easy
AACSB: Analytic
3) Which of the following is generally not a major sourceDifficulty : of input to a payroll

system?
A) payroll rate changes
B) time and attendance data
C) checks to insurance and benefits providers
D) withholdings and deduction requests from employees
Answer: C
Difficulty: Easy
AACSB: Analytic
4) Who does the payroll system issue checks to?

A) employees and to banks participating in direct deposit
B) a company payroll bank account
C) government agencies
D) All of the above are correct.
Answer: D
Difficulty: Easy
AACSB: Analytic
1
Copyright © 2015 Pearson Education, Inc.
5) Experts estimate that, on average, the costs associated with replacing an employee are about
________ the employee's annual salary.
A) one-quarter of
B) one-half of
C) one and one-half times
D) twice
Answer: C
Difficulty: Moderate
AACSB: Analytic
6) For recording time spent on specific work projects, manufacturing companies usually use a
A) job time ticket.
B) time card.
C) time clock.
D) labor time card.
Answer: A
Difficulty: Easy
AACSB: Analytic
7) Which of the following statements is false regarding the use of incentives, commissions and
bonuses in the payroll system?
A) Using incentives, commissions, and bonuses requires linking the payroll system and the
information systems of sales and other cycles in order to collect the data used to calculate
bonuses.
B) Bonus/incentive schemes must be properly designed with realistic, attainable goals that can be
objectively measured.
C) Incentive schemes can result in undesirable behavior.
D) All of the above are true.
Answer: D
AACSB: Analytic
8) Identify the item below that is not a desired result of an employee bonus systems.
A) Employees may recommend unnecessary services to customers in order to exceed set sales
quotas and earn a bonus.
B) Employees may look for ways to improve service.
C) Employees may analyze their work environment and find ways to cut costs.
D) Employees may work harder and may be more motivated to exceed target goals to earn a
bonus.
Answer: A
Difficulty: Easy
AACSB: Analytic
2
9) ________ are used to transmit time and attendance data directly to the payroll processing
system.
A) Badge readers
B) Electronic time clocks
C) Magnetic cards
D) none of the above
Answer: B
Difficulty: Easy
AACSB: Analytic
10) Payroll deductions fall into the broad categories of ________ and ________.
A) payroll tax withholdings; voluntary deductions
B) unemployment; social security taxes
C) unemployment taxes; income taxes
D) voluntary deductions; income taxes
Answer: A
Difficulty: Easy
AACSB: Analytic
11) Which of the following is not classified as a voluntary deduction?

A) pension plan contributions
B) social security withholdings
C) insurance premiums
D) deductions for a charity organization
Answer: B
Difficulty: Easy
AACSB: Analytic
12) Which type of payroll report contains information such as the employees' gross pay, payroll
deductions, and net pay in a multicolumn format?
A) payroll register
B) deduction register
C) employee earnings statement
D) federal W-4 form
Answer: A
Difficulty: Easy
AACSB: Analytic
3
13) Which type of payroll report lists the voluntary deductions for each employee?
A) payroll register
C) earnings statement
D) federal W-4 form
Answer: B
Difficulty: Easy
AACSB: Analytic
14) Which type of payroll report includes the details of the current paycheck and deductions as
well as year-to-date totals?
A) payroll register
C) earnings statement
D) federal W-4 form
Answer: C
Difficulty: Easy
AACSB: Analytic
15) An effective way an organization can eliminate paper paychecks while maintaining adequate
accounting records is to
A) pay in cash only.
B) pay with money orders.
C) use direct deposit.
D) use Electronic Funds Transfer.
Answer: C
Difficulty: Easy
AACSB: Analytic
16) Companies that specialize in processing payroll are known as

A) paycheck distribution companies.
B) payroll service bureaus.
C) professional employer organizations.
D) semi-governmental organizations.
Answer: B
Difficulty: Easy
AACSB: Analytic
4
17) Which organization provides payroll processing as well as other HRM services, like
employee benefit design and administration?
A) title companies
B) payroll service bureau
C) professional employer organization
D) paycheck distribution companies
Answer: C
Difficulty: Easy
AACSB: Analytic
18) Which of the following is not a benefit of using a payroll service bureau or a professional
employer organization?
A) freeing up of computer resources
B) increased internal control
C) reduced costs
D) wider range of benefits
Answer: B
Difficulty: Easy
AACSB: Analytic
19) Many companies offer their employees a "cafeteria" approach to voluntary benefits in which
employees can pick and choose the benefits they want. This plan is normally called a(n)
A) elective plan.
B) menu options benefit plan.
C) flexible benefit plan.
D) buffet plan.
Answer: C
Difficulty: Easy
AACSB: Analytic
20) Pay rate information should be stored in

A) employees' personnel files.
B) employee subsidiary ledgers.
C) the payroll master file.
D) electronic time cards.
Answer: C
AACSB: Analytic
5
21) The payroll transaction file should contain
A) entries to add new hires.
B) time card data.
C) changes in tax rates.
Answer: B
AACSB: Analytic
22) The document that lists each employee's gross pay, payroll deductions, and net pay in a
multicolumn format is called
A) an employee earnings statement.
B) the payroll register.
C) a deduction register.
D) an employee time sheet summary.
Answer: B
Difficulty: Easy
AACSB: Analytic
23) As each payroll transaction is processed, the system should also

A) allocate labor costs to appropriate general ledger accounts
B) use cumulative totals generated from a payroll to create a summary journal entry to be posted
to the general ledger
C) both A and B above
D) The HRM system should not perform either activity A or B.
Answer: C
AACSB: Analytic
24) Direct deposit of employee paychecks is one way an organization can improve efficiency and
reduce payroll-processing costs. Which statement regarding direct deposit is false?
A) The cashier does not authorize the transfer of funds from the organization's checking account
to a payroll checking account.
B) The cashier does not have to sign employee paychecks.
C) Employees who are part of a direct deposit program receive a copy of their paycheck
indicating the amount deposited.
D) Employees who are part of a direct deposit program receive an earnings statement on payday
rather than a paper check.
Answer: A
AACSB: Analytic
6
25) The employer pays a portion of some payroll taxes and employee benefits. Both the
employee and employer pay which benefit or tax listed below?
A) social security taxes
B) federal income taxes
C) state income taxes
D) none of the above
Answer: A
Difficulty: Easy
AACSB: Analytic
26) Identify the following item that should contribute to the efficiency of a payroll system.
A) segregation of check distribution from payroll duties
B) prompt redeposit of unclaimed paychecks
C) a separate payroll bank account
D) direct deposit of checks
Answer: D
Difficulty: Easy
AACSB: Analytic
27) Which of the following documents would be likely to yield the greatest cost saving by
converting from paper to electronic?
A) payroll register
B) earnings statement
C) deduction register
D) time card
Answer: D
Difficulty: Easy
AACSB: Analytic
28) Describe the basic activities in an HRM/payroll cycle.

Answer: The HRM/payroll cycle is a recurring set of business activities and related data
processing operations associated with effectively managing the employee work force. Important
activities in the HRM/payroll cycle include the following tasks: Recruitment and hiring of new
employees. Training. Job assignment. Compensation (payroll). Performance evaluation.
Discharge.
Difficulty: Easy
AACSB: Analytic
7
29) Identify the two types of payroll deductions and give two examples of each type.
Answer: Payroll deductions include: Payroll tax withholdings such as federal, state, and local
income taxes, social security taxes, unemployment taxes; Voluntary deductions such as
contributions to a pension plan, premium for group life, etc.
Difficulty: Easy
AACSB: Analytic
30) Why are accurate cumulative earnings records important?

Answer: Accurate records of cumulative earnings are necessary because social security and
other deductions have maximum earnings amounts upon which taxes are paid; and the
appropriate amount of income and payroll taxes should be remitted to the government agencies.
At the end of each calendar year, businesses must prepare and mail summary earnings statements
to every employee with earnings that year.
AACSB: Analytic
31) Explain the functions of the payroll register, deduction register, and earnings statement.
Answer: The payroll register is a report that lists each employee's gross pay, payroll deductions,
and net pay for each pay period. The deduction register lists the voluntary deductions for each
employee. The earnings statement lists the amount of gross pay, deductions, and net pay for the
current period, as well as providing year-to-date totals.
Difficulty: Easy
AACSB: Analytic
32) What is the difference between a payroll service bureau and a professional employer
organization?
Answer: A payroll service bureau is a company that can be hired as an independent contractor to
maintain the payroll master file and perform the payroll processing activities for an organization.
A professional employer organization is a company that provides not only full payroll services
but also provides HRM services such as employee benefit design and administration.
Difficulty: Easy
AACSB: Analytic
8
33) Discuss the various types and sources of input into the HRM/payroll cycle.
Answer: An HRM/payroll system relies on input from various sources. Employees provide input
when they make changes in their discretionary deductions (contributions to charities or
retirement plans); various departments provide data about the actual hours employees work. The
HRM department provides information about employees who have been hired or terminated,
pay-rate changes, and promotions. Government agencies provide tax rates and various
instructions for meeting regulatory requirements. Insurance companies and other organizations
provide instructions for calculating and remitting various withholding amounts.
Difficulty: Difficult
AACSB: Analytic
34) A growing number of companies require some of their upper level executives to spend time
performing job duties of rank-and-file employees. When the CEO of Loews Hotels assumed the
role of bellman, he discovered
A) that the company's polyester uniform caused him to sweat a great deal.
B) evidence of fraud in several hotel locations.
C) instances where company employees fell asleep on the job.
D) situations where employees were not treating customers properly.
Answer: A
AACSB: Analytic
35) Executive immersion experiences are important because

A) CEOs often have no idea what rank-and-file employees do on a daily basis.
B) employees who have positive attitudes contribute to increasing company profits.
C) many employees feel upper management is out of touch.
D) it is important for organizations to take social responsibility seriously.
Answer: B
AACSB: Analytic
36) True or False: The HRM department should immediately delete records of employees who
quit to prevent other employees from assuming their identities.
Answer: FALSE
Difficulty: Easy
AACSB: Analytic
9
37) Involving accountants in executive compensation plans is often especially helpful
A) in keeping track of the executive compensation plan.
B) in identifying the appropriate metrics to use when linking compensation to performance.
C) in reducing the total amount of compensation paid to executives.
D) in suggesting the appropriate amount of compensation executives should be paid.
Answer: B
AACSB: Analytic
38) Accountants can help executive compensation plan boards

A) comply with legal and regulatory requirements.
B) by identifying the best ways to keep the details of compensation plans out of the hands of
external parties.
C) avoid paying excessive amounts of "perks" to executives.
D) distribute information regarding how well each executive is performing their job.
Answer: A
AACSB: Analytic
39) Form 941

A) is filed each quarter to reconcile monthly tax payments with total tax liability for the quarter.
B) is used in preparing labor-related reports for government agencies.
C) is used for employee information and annual payroll reports.
D) is used to document compliance with applicable regulations.
Answer: A
AACSB: Analytic
40) A workforce inventory report

A) is filed each quarter to reconcile monthly tax payments with total tax liability for the quarter.
B) is used in preparing labor-related reports for government agencies.
C) is used for employee information and annual payroll reports.
D) is used to document compliance with applicable regulations.
Answer: B
AACSB: Analytic
10
41) Professional employer organizations (PEOs) are especially attractive to small and mid-sized
businesses for all of the following reasons except
A) reduced costs.
B) wider range of benefits.
C) freeing up computer resources.
D) improved service quality.
Answer: D
AACSB: Analytic
15.2 Discuss the key decisions to be made in the HRM/payroll cycle and identify the
information needed to make those decisions.
1) The sales department administrative assistant has been assigning phone order sales to her
brother-in-law, a company sales person. Company policy is to pay commissions only on orders
directly received by sales people, not on orders received over the phone. The resulting fraudulent
commission payments might best have been prevented by requiring that
A) sales commission statements be supported by sales order forms signed by the customer and
approved by the sales manager.
B) sales order forms be prenumbered and accounted for by the sales department manager.
C) sales orders and commission statements be approved by the accounting department.
D) disbursement vouchers for commission payments be reviewed by the internal audit
department and compared to sales commission statements and sales orders.
Answer: A
AACSB: Analytic
2) Because many HRM / payroll master databases typically contain only descriptive information
(such as which employees possess which skills), many firms have deployed ________ to more
effectively leverage employees knowledge and skills.
A) relational databases
B) knowledge management systems
C) Resources, Events, and Agents (REA) databases
D) cardinality systems
Answer: B
AACSB: Analytic
11
3) Identify the firm below where employees' knowledge is likely to be more valuable than the
value of a company's tangible assets.
A) international airline
B) law firm
C) automobile manufacturer
D) railroad
Answer: B
AACSB: Analytic
4) True or False: Batch processing continues to be widely used to process payroll transactions.
Answer: TRUE
Difficulty: Easy
AACSB: Analytic
5) Knowledge management systems (KMS) permit organizations to

A) store employee solutions to specific problems in a shared database.
B) learn from individuals external to the organization.
C) perform background checks on potential employees.
D) gain competitive business intelligence on competitors.
Answer: A
AACSB: Analytic
15.3 Identify the major threats in the HRM/payroll cycle and evaluate the adequacy of various
internal control procedures for dealing with them.
1) Why is a separate payroll account used to clear payroll checks?

A) for internal control purposes, to help limit any exposure to loss by the company
B) to make bank reconciliation easier
C) Banks don't like to commingle payroll and expense checks.
Answer: A
AACSB: Analytic
12
2) The following control can reduce the distribution of fraudulent paychecks.
A) Have internal audit investigate unclaimed paychecks.
B) Allow department managers to investigate unclaimed paychecks.
C) Immediately mark "void" across all unclaimed paychecks.
D) Match up all paychecks with time cards.
Answer: A
AACSB: Analytic
3) When using electronic documents, ________ increase(s) the accuracy of data entry.
A) access controls
B) separation of duties
C) general controls
D) application controls
Answer: D
Difficulty: Easy
AACSB: Analytic
4) The most vital control in preventing unauthorized changes to the payroll master file is
A) hiring totally honest people to access and make changes to this file.
B) segregation of duties between the preparation of paychecks and their distribution.
C) segregation of duties between the authorization of changes and the physical handling of
paychecks.
D) having the controller closely review and then approve any changes to the master file.
Answer: C
AACSB: Analytic
5) Which of the following is not a potential effect of inaccurate data on employee time cards?
A) increased labor expenses
B) erroneous labor expense reports
C) damaged employee morale
D) inaccurate calculation of overhead costs
Answer: D
AACSB: Analytic
13
6) Which control would be most appropriate to address the problem of inaccurate payroll
processing?
A) encryption
B) direct deposit
C) cross-footing of the payroll register
D) an imprest payroll checking account
Answer: C
AACSB: Reflective Thinking
7) The purpose of a general ledger payroll clearing account is

A) to check the accuracy and completeness of payroll recording and its allocation to cost centers.
B) to make the bank reconciliation easier.
C) to make sure that all employees are paid correctly each week.
D) to prevent the cashier from having complete control of the payroll cycle.
Answer: A
AACSB: Analytic
8) A "zero balance check" refers to which of the following control procedures?

A) a type of batch total
B) cross-footing the payroll register
C) the payroll clearing account shows a zero balance once all entries are posted
D) trial balance showing that debits equal credits
Answer: C
AACSB: Analytic
9) All of the following are controls that should be implemented in a payroll process, except
A) supervisors distribute paychecks since they should know all employees in their department.
B) someone independent of the payroll process should reconcile the payroll bank account.
C) sequential numbering of paychecks and accounting for the numbers.
D) restrict access to blank payroll checks and documents.
Answer: A
AACSB: Analytic
14
10) What is the best control to reduce the risk of losing payroll data?
A) passwords
B) physical security controls
C) backup and disaster recovery procedures
D) encryption
Answer: C
Difficulty: Easy
AACSB: Analytic
11) The threat of violation of employment laws relates directly to which activity?
A) payroll processing
B) collecting employee time data
C) hiring and recruiting
D) all of the above
Answer: C
AACSB: Analytic
12) What is a potential threat to the specific activity of payroll processing?

A) hiring unqualified employees
B) poor system performance
C) violations of employment laws
D) unauthorized changes to the payroll master file
Answer: D
AACSB: Analytic
13) The results of an internal audit finds that there is a problem with inaccurate time data being
entered into the payroll system. What is an applicable control that can help prevent this event
from occurring in the future?
A) proper segregation of duties
B) automation of data collection
C) sound hiring procedures
D) review of appropriate performance metrics
Answer: B
Difficulty: Easy
AACSB: Analytic
15
14) Which of the following is a control that can be implemented to help prevent paychecks being
issued to a "phantom" or "ghost" employee?
A) The cashier should sign all payroll checks.
B) Sequentially prenumber all payroll checks.
C) Use an imprest account to clear payroll checks.
D) Paychecks should be physically distributed by someone who does not authorize time data or
record payroll.
Answer: D
AACSB: Analytic
15) The average annual management salary at Iyov Management is $80,000. If the average
turnover rate for employees is ten per year, what is the approximate average annual cost of
turnover?
A) $80,000
B) $400,000
C) $800,000
D) $1,200,000
Answer: D
AACSB: Analytic
16) Which of the following will limit a firm's potential loss exposure from paycheck forgery?
A) segregation of check distribution from payroll duties
B) prompt redeposit of unclaimed paychecks
C) a separate payroll bank account
D) direct deposit of checks
Answer: C
Difficulty: Easy
AACSB: Analytic
17) Which of the following is a control that addresses the threat of unauthorized changes to the
payroll master file?
A) field checks
B) batch totals
C) segregation of duties
D) sound hiring procedures
Answer: C
Difficulty: Easy
AACSB: Analytic
16
18) For the payroll register below, all the following data entry controls would be useful except
A) validity check on Fed. Tax

B) sequence check on Employee No.
C) limit check on Hours
D) field check on Pay Rate
Answer: A
Difficulty: Easy
AACSB: Analytic
19) For the payroll register below, all the following processing controls would be useful except
A) concurrent update control

B) cross-footing balance test
C) mathematical accuracy test
D) hash total on Employee No.
Answer: A
Difficulty: Easy
AACSB: Analytic
17
20) Describe benefits and threats of incentive and bonus programs.
Answer: Sales staffs are often paid either on a straight commission basis or a combination of a
salary plus commissions. This is done to keep sales at a certain level or to increase sales. The
HRM/payroll system will need input from the sales and other cycles to properly calculate
commissions and bonuses for such employees. It is important that an incentive and bonus system
sets realistic, attainable goals that are congruent with corporate objectives. It is also important
that managers monitor incentive and bonus goals and ensure that the attainment of such goals is
appropriate for the organization and does not lead to undesirable behavior, which can result from
poorly designed incentive schemes.
AACSB: Analytic
21) Explain benefits to companies and to employees of using electronic direct deposit for
payroll.
Answer: Direct deposit of paychecks provide a savings to employers because the costs of
purchasing, processing, and distributing paper checks is eliminated. Using direct deposit also
reduces postage and bank fees. The cashier's time can be better spent because paychecks do not
have to be signed. Employees save time as well as they do not have to make a physical trip to the
bank to cash their checks. Direct deposit is safer as it eliminates misplaced paychecks and
reduces the possibility of the theft of checks.
AACSB: Reflective Thinking
22) What factors should be considered in outsourcing payroll to a payroll service bureau?
Discuss the advantages and disadvantages of using a payroll service bureau to process a payroll.
Answer: The following questions should be considered: How much does the service cost? How
would the data be submitted—online or hand carried? What kind of reports and documents could
be obtained from the service bureau? How would the service interface with the existing general
ledger system? What resources are now being devoted to payroll and how could these resources
be re-deployed into other areas? Could security and control be improved by the outsourcing?
What would be the time length of a contract for outsourcing services? Could the service bureau
system be integrated so that an online query could be made by the organization? What kind of
track record does the service bureau have with other clients? Are there new technologies and
approaches that would become available to the company via the service bureau? Advantages: No
need to deal with complexity and changes in tax codes. No need to worry about what to do if
equipment crashes. Less chance of employees accessing the payroll files (confidentiality).
Possible efficiency and cost reductions. Wider range of benefits. Freed-up computer resources.
Disadvantages: Less control over the payroll files because they are stored off-site. Extra costs for
any special reports. Slower response to ad hoc queries.
AACSB: Analytic
18
23) Discuss the threat of unauthorized changes to the payroll master file and its consequences.
Answer: Many problems may result when there are unauthorized changes to the payroll master
file. Unauthorized changes may be made to employee pay rates, resulting in the company paying
too much in wages. "Ghost" or "phantom" employees may be added to the payroll master to
divert funds to dishonest employees through the issuance of paychecks to such "employees."
Likewise, terminated employees may still be paid, resulting in the fraudulent diversion of payroll
funds. Two controls that should be implemented and maintained to provide overall control of the
payroll master file: proper segregation of duties and controlling access to the file. Good internal
control dictates that only authorized HRM personnel be allowed to update the payroll master file
for any hiring, termination, pay raise, and promotion. HRM personnel, who have such access to
the payroll master file, should never be allowed to directly participate in actual payroll
processing or paycheck distribution. This way an adequate control is created to match actual
paychecks (or earnings statements when direct deposit is in place) with employees when a
manager, supervisor, or other third party hand out the checks (or earnings statements). Also, a
different individual should approve all changes to the payroll master file in writing other than the
individual who recommends or initiates the changes. User IDs and passwords should always be
used to control access to the payroll master file, and an access control matrix should be
established to define what actions each authorized employee is allowed to make and confirms the
files the employee may access.
AACSB: Analytic
24) What controls are available to address the threat of payroll errors?
Answer: Three types of controls can be used to circumvent payroll errors in an HRM/payroll
system. Batch totals are used to verify totals entered into the system both at the time of data entry
and at each stage in the processing. Hash totals are particularly useful in this regard, since hash
totals calculated at the time of original data entry and again at each stage in the process can be
compared. When the comparisons match throughout the process, three conclusions can be made:
1) all payroll records have been processed; 2) the data input was accurate; and 3) no bogus time
cards were entered at any point after initial input. Upon completion of a payroll, the payroll
register should be cross-footed to verify that the totals of the net pay column and other deduction
columns equal the total of the gross pay column. A third control is the use of a payroll clearing
account. This is a general ledger account that can be used as part of a two-step accuracy and
completeness process. First, the payroll control account will be debited for the amount of the
gross pay for the pay period; cash and other various withholding liability accounts are credited.
Second, the cost accounting process distributes labor costs to various expense categories and
credits the payroll control account for the total amount of the debits made to the other accounts.
The result is that the payroll control account will have a zero balance. This becomes an internal
check known as a zero balance check, indicating that the proper postings have been made to all
of the accounts associated with payroll for a given pay period.
AACSB: Analytic
19
25) Using financial incentives requires organizations to
A) pay employees less than they would have to if pay was a fixed salary.
B) better monitor employee attendance.
C) link the payroll system to other cycles to calculate incentive payments.
D) better monitor employee effort.
Answer: C
AACSB: Analytic
26) Source data automation is often effective in reducing

A) unintentional errors.
B) intentional errors.
C) accuracy.
D) theft.
Answer: C
AACSB: Analytic
27) A payroll clearing account is used to

A) check the accuracy of payroll costs.
B) speed up payroll transaction processing.
C) reduce the transaction costs associated with payroll transaction processing.
D) eliminate the need to manually record payroll transactions.
Answer: A
AACSB: Analytic
28) All of the following regarding payroll checks is correct except

A) access to payroll checks should be restricted.
B) payroll checks should be sequentially pre-numbered.
C) payroll checks should be drawn on the organization's regular bank account(s).
D) the cashier should sign payroll checks.
Answer: C
AACSB: Analytic
20
29) Falk Noam is the internal auditor for Matan Incorporated. Before investigating the HRM /
payroll cycle at Matan, Falk decided to read up on the proper segregation of duties regarding
payroll disbursement processes. For strongest segregation of duties, the ________ should
distribute paychecks.
A) accounts payable department
B) cashier
C) internal audit department
D) external auditor
Answer: B
AACSB: Analytic
payroll disbursement processes. For strongest segregation of duties, the ________ should record
payroll.
B) cashier
D) external auditor
Answer: A
AACSB: Analytic
payroll disbursement processes. For strongest segregation of duties, the ________ should
periodically observe the paycheck distribution process.
B) cashier
D) external auditor
Answer: C
AACSB: Analytic
21

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Accounting Information Systems, 13e (Romney/Steinbart)

Chapter 15 The Human Resources Management and Payroll Cycle

1) Which activity below is not performed by Human Resources management (HRM)?

3) Which of the following is generally not a major sourceDifficulty : of input to a payroll

4) Who does the payroll system issue checks to?

11) Which of the following is not classified as a voluntary deduction?

16) Companies that specialize in processing payroll are known as

20) Pay rate information should be stored in

23) As each payroll transaction is processed, the system should also

28) Describe the basic activities in an HRM/payroll cycle.

30) Why are accurate cumulative earnings records important?

35) Executive immersion experiences are important because

38) Accountants can help executive compensation plan boards

39) Form 941

40) A workforce inventory report

5) Knowledge management systems (KMS) permit organizations to

1) Why is a separate payroll account used to clear payroll checks?

7) The purpose of a general ledger payroll clearing account is

8) A "zero balance check" refers to which of the following control procedures?

12) What is a potential threat to the specific activity of payroll processing?

A) validity check on Fed. Tax

A) concurrent update control

26) Source data automation is often effective in reducing

27) A payroll clearing account is used to

28) All of the following regarding payroll checks is correct except

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