 Question 1

0 out of 2 points
Risk of unauthorized access to payroll records and confidential employee data include the possibility of

Selected Answer:  
overpayment of employee.
Answers: overpayment of employee.
 
corrupting or deleting payroll data.
non-recording or incorrectly recording wages payable.
paying nonexistent employee.
 Question 2
2 out of 2 points
As part of the independent verification controls to address fixed asset system risks, which of the following
information should be verified against the fixed assets records in the subsidiary ledger?

A) fair value of the fixed asset

B) condition of the fixed asset

C) location of the fixed asset

Selected Answer:  
A, B, and C are all correct.
Answers: Only A is correct.
Only B is correct.
Only A and B are correct.
 
A, B, and C are all correct.
 Question 3
2 out of 2 points
You are the internal auditor of Crusher Company. You are currently auditing the company's payroll process. To
verify the validity of the total salaries payable, the most appropriate document to look at is the

Selected Answer:  
payroll voucher.
Answers: job ticket.
time card.
employee pay check.
 
payroll voucher.
 Question 4
2 out of 2 points
An example of an Accounting Record control to address the risk of inaccurately
 recording transactions is
Selected Answer:  
preparing disbursement vouchers.
Answers:  
preparing disbursement vouchers.
AP clerk checking of payroll register accuracy.
implementing missing data and numeric-alphabetic data checks.
producing error messages.
 Question 5
2 out of 2 points
To check whether there is sufficient fund for the payroll of employees, which account should be looked into?

Selected Answer:  
Payroll imprest account
Answers: Petty cash account
 
Payroll imprest account
Investment account
General cash account
 Question 6
2 out of 2 points
The cost accountant is computing for the labor costs to be charged to the WIP accounts. Which document is
relevant for this purpose?

Selected Answer:  
Job ticket
Answers: Payroll voucher
Time card
 
Job ticket
Personnel action form
 Question 7
0 out of 2 points
Due to their larger size, fixed assets are generally more susceptible to theft as compared to inventory items.

Selected Answer:
True
Answers: True

False
 Question 8
2 out of 2 points
 Who should distribute pay checks to the employees to help verify existence of the employees?

Selected Answer:  
Paymaster
Answers: Payroll supervisor
Employeesâ supervisor
Payroll clerk
 
Paymaster
 Question 9
2 out of 2 points
The internal auditor wants to recheck the payroll computations (gross pay, taxes and other deductions, net pay)
for 10 employees for a specific payroll period. The payroll clerk should best refer to the

Selected Answer:  
payroll register.
Answers: labor distribution summary.
time card.
 
payroll register.
employee paycheck.
 Question 10
2 out of 2 points
A physical (manual) control to address the risk of misappropriating cash through payroll fraud is

Selected  
Answer: having an independent paymaster to distribute checks to help confirm the existence of
employees.
Answers: having limit tests to detect excessive hours reported per period.
 
having an independent paymaster to distribute checks to help confirm the existence of
employees.
having computerized tests to validate timecards against up-to-date employee files.
having biometric scanners, swipe cards, and PINs to determine that individuals clocking-in are
valid and existing employees.
 Question 11
0 out of 2 points
You are the cash disbursement clerk of Jackson Storm Inc. After preparing the check to fund the payroll imprest
account, you will be recording the transaction in the

Selected Answer:  
payroll register.
Answers: collection register.
 payroll register.
 
check register.
POS register.
 Question 12
2 out of 2 points
The payroll cycle is more similar to the revenue cycle than the expenditure cycle.

Selected Answer:
False
Answers: True

False
 Question 13
2 out of 2 points
Which of the following statements about the basic technology payroll system is most correct?

Selected  
Answer: Payroll voucher and payroll register trigger the preparation of the check to fund the payroll
imprest account by the Cash Disbursement Department.
Answers: Labor distribution summary, which is prepared by the Personnel Department, goes to the GL
Department and will be the trigger document for the updating of the GL file.
The payroll clerk computes the salaries expense based on the time cards and personnel action
forms (PAFs), updates employee records (total salaries, income taxes withheld), prepares and
signs all pay checks, and sends signed pay checks to the payroll supervisor for distribution to
employees.
Time cards (approved by the supervisor) which authorize part of the payroll process and contain
hours worked are sent to the General Ledger Department.
 
Payroll voucher and payroll register trigger the preparation of the check to fund the payroll
imprest account by the Cash Disbursement Department.
 Question 14
2 out of 2 points
Aside from the receiving report, which document/report is needed by the fixed asset clerk to perform the
acquisition procedures related to the Fixed Asset Department?

Selected Answer:  
Cash disbursement voucher
Answers: Fixed asset depreciation report
Depreciation schedule
 
Cash disbursement voucher
Asset status report
 Question 15
0 out of 2 points
 If you are the general ledger clerk, which documents do you need to reconcile first before posting the payroll
entries into the General Ledger?

Selected Answer:  
employee payroll records and payroll register
Answers: job tickets and employee paychecks
employee payroll records and payroll register
 
labor distribution summary and payroll voucher
time cards and personnel action forms
 Question 16
2 out of 2 points
In the physical fixed asset system, receiving the receiving report and cash disbursement voucher is part of the

Selected Answer:  
asset acquisition procedures.
Answers:  
asset acquisition procedures.
asset disposal procedures.
asset impairment procedures.
asset maintenance procedures.
 Question 17
2 out of 2 points
Personnel action form is prepared by the

Selected Answer:  
Human Resources Department
Answers: Production Department
 
Human Resources Department
General Ledger Department
Cost Accounting Department
 Question 18
2 out of 2 points
The document or accounting record used to activate new employees and change the pay rate of employees is the

Selected Answer:  
personnel action form.
Answers: employee payroll record.
 
personnel action form.
time card.
 labor distribution summary.
 Question 19
0 out of 2 points
You are the internal auditor of Simon Inc. You want to verify if the asset acquisitions of the company are
properly approved. To which department should you go to verify this?

Selected Answer:  
Fixed Asset Accounting Department
Answers: Receiving Department
Fixed Asset Accounting Department
General Ledger Department
 
User Department
 Question 20
2 out of 2 points
Which of the following is an IT control to address the risk of misappropriating cash through payroll fraud?

Selected Answer:  
Implementing automated tests to validate timecards against current employee files.
Answers:  
Implementing automated tests to validate timecards against current employee files.
Preventing improper access to accounting records.
Reconciling labor distribution summary and payroll disbursement voucher.
Outsourcing the payroll function
 Question 21
2 out of 2 points
Specific objectives of the fixed asset system include:

A) Process the purchase of fixed assets as needed and in accordance with formal management
authorization and procedures
B) Maintain correct depreciation records for depreciable assets in accordance with acceptable
depreciation methods
C) Appropriately record the retirement and disposal of fixed assets
Selected Answer:  
A, B and C are all correct.
Answers: Only A is correct.
Only B is correct.
Only C is correct.
 
A, B and C are all correct.
 Question 22
2 out of 2 points
In the DFD of the fixed asset system, the depreciation schedule data store is most closely related to the process of
 Selected Answer:  
asset maintenance.
Answers:  
asset maintenance.
asset acquisition.
asset disposal.
asset impairment.
 Question 23
2 out of 2 points
Why should the supervisor of the employees not be the one to distribute pay checks?

Statement 1: A form of payroll fraud may occur involving the supervisor submitting fraudulent time cards for
nonexistent employees.

Statement 2: The resulting paychecks, when given to the supervisor, are then cashed by him.

Selected Answer:  
Both statements are correct.
Answers: Only statement 1 is correct.
Only statement 2 is correct.
 
Both statements are correct.
Both statements are incorrect.
 Question 24
0 out of 2 points
A physical (manual) control to address the risk of inaccurately recording transactions is

Selected  
Answer: automated posting to accounts.
Answers: automated posting to accounts.
using biometric scanners, swipe cards, and PINs help ensure that individuals timing-in are
valid employees.
 
supervisor verifying the correctness of time cards and attendance.
implementing multilevel security techniques
 Question 25
2 out of 2 points
Which activity applies both to the acquisition of inventories and purchase of fixed assets?

Selected  
Answer: Use purchase requisitions and purchase orders
Answers: Done on a regular (frequent) basis
Require specific management approval and explicit authorization procedures
  
Use purchase requisitions and purchase orders
Apportion costs over the life of the asset and depreciate the asset in accordance with
accounting conventions
 Question 26
2 out of 2 points
Which department prepares the employee pay checks?

Selected Answer:  
Payroll Department
Answers: Production Department
Personnel Department
Cost Accounting Department
 
Payroll Department
 Question 27
2 out of 2 points
In the computer-based fixed asset system, which file is most probably unique only to the asset acquisition
procedures and not common to all the fixed asset procedures (acquisition, maintenance and disposal)?

Selected Answer:  
Receiving report file
Answers: General ledger file
Journal voucher file
Fixed asset file
 
Receiving report file
 Question 28
2 out of 2 points
To check whether depreciation for the fixed assets are properly computed, the most appropriate document to
refer to is the

Selected Answer:  
depreciation schedule.
Answers:  
depreciation schedule.
fixed asset subsidiary ledger.
asset status report.
fixed asset record structure.
 Question 29
2 out of 2 points
As part of the segregation of duties control to address the risk of misappropriating cash through payroll fraud, the
AP Department should be assigned the responsibility of reviewing payroll register and approving payment. These
 activities should not be performed by the Payroll Department because:

Statement 1: Payroll Department has asset custody (paychecks).

Statement 2: Payroll Department has record-keeping responsibility (employee payroll records).

Selected Answer:  
Both statements are correct.
Answers: Only statement 1 is correct.
Only statement 2 is correct.
 
Both statements are correct.
Both statements are incorrect.
 Question 30
2 out of 2 points
A time keeping device which verifies employees' identities by using fingerprint or hand-vein scan technology is
the

Selected Answer:  
biometric time clock.
Answers: proximity card.
 
biometric time clock.
mobile remote device.
magnetic swipe ID card.
 Question 31
2 out of 2 points
Risk of miscalculated depreciation which can result to material misstatement of operating expenses, reported
earnings and asset values may be best addressed by

Selected  
Answer: the internal auditor reviewing and verifying depreciation charges computed on fixed assets, for
accuracy.
Answers: the internal auditor reviewing the asset acquisition and approval procedures.
supervisors ensuring that fixed assets are being used in accordance with the organization's
policies and business practices.
having written request from the user or department for fixed asset acquisitions.
 
the internal auditor reviewing and verifying depreciation charges computed on fixed assets, for
accuracy.
 Question 32
2 out of 2 points
When an asset has reached the end of its useful life or when management decides to put it away, the asset must
be removed from the fixed asset subsidiary ledger. This activity is related to
 Selected Answer:  
asset disposal.
Answers: asset impairment.
asset acquisition.
asset maintenance.
 
asset disposal.
 Question 33
2 out of 2 points
Which activity is done as part of the asset maintenance procedures?

Selected  
Answer: Update accumulated depreciation and book-value fields in the subsidiary records
Answers: Sending the fixed asset status report containing the details of the deletion to the fixed asset
department for review
 
Update accumulated depreciation and book-value fields in the subsidiary records
Post an adjusting entry to the fixed asset control account in the GL
Create a record of the asset in the FAS ledger and the system automatically updates the GL
 Question 34
0 out of 2 points
If you are the payroll clerk, which documents do you need to receive in order to begin the payroll process?

Selected Answer:  
Payroll register and check register
Answers: Job tickets and labor distribution summary
 
Time cards and personnel action forms
Payroll register and check register
Employee pay checks and single check to fund the payroll imprest account
 Question 35
2 out of 2 points
Which procedure differs between acquisition of inventories and purchase of fixed assets?

Selected Answer:  
Disposal procedure
Answers: Cash disbursement procedure
Purchase procedure
 
Disposal procedure
Accounts payable procedure
 Question 36
 2 out of 2 points
Separating timekeeping and personnel functions is an example of

Selected Answer:  
segregation of duties.
Answers:  
segregation of duties.
access control.
transaction authorization.
supervision.
 Question 37
2 out of 2 points
Payroll processing is a special-case purchases system in which organization purchases

Selected Answer:  
Labor
Answers: Finished good
Raw material
 
Labor
Fixed asset
 Question 38
2 out of 2 points
Which document triggers the Accounts Payable Department to prepare the voucher for the payroll?

Selected Answer:  
Payroll register
Answers:  
Payroll register
Employee payroll record
Check register
Employee pay check
 Question 39
2 out of 2 points
The document/report which formally authorizes the fixed asset department to remove from the fixed asset ledger
an asset disposed of by the user department is

Selected Answer:  
disposal report.
Answers: packing slip.
purchase order.
 
 disposal report.
receiving report.
 Question 40
2 out of 2 points
In the DFD of the fixed asset system, which document triggers the asset acquisition process?

Selected Answer:  
Purchase requisition
Answers: Asset changes
Disposal request
 
Purchase requisition
Supplier's invoice
 Question 41
2 out of 2 points
In the basic technology payroll system, the Production Department

Selected  
Answer: accomplishes the time cards and job tickets.
Answers:  
accomplishes the time cards and job tickets.
reconciles summary information from cost accounting and accounts payable.
reconciles information in the personal action forms and time cards, calculates payroll and sends
paychecks to paymaster for distribution to employees.
receives information regarding hours spent on each job for posting to the WIP subsidiary ledger.
 Question 42
2 out of 2 points
Which system captures a wide range of personnel-related data such as employee benefits, employee skills, and
personnel actions (pay rates and deductions)?

Selected Answer:  
Human Resource Management System
Answers:  
Human Resource Management System
Point-of-Sale System
Database Management System
Customer Relations Management System
 Question 43
2 out of 2 points
In the diagram of the payroll procedures, which record is immediately updated after the prepare payroll process?

Selected Answer:  
 Employee payroll record
Answers: Voucher
Work in process subsidiary ledger
 
Employee payroll record
Check register
 Question 44
2 out of 2 points
Which of the following is the easiest way for the general ledger department to determine whether there are errors
in the calculation of either labor distribution charges or payroll?

Selected  
Answer: Check if debits and credits related the payroll entries are equal or not.
Answers: There is no easy way to check the accuracy of the payroll calculations but to repeat the whole
payroll process.
Recompute the payroll register (containing the gross pay, deductions, overtime pay, and net
pay) prepared by the payroll department.
Verify all payroll information received from the personnel and production departments.
 
Check if debits and credits related the payroll entries are equal or not.
 Question 45
2 out of 2 points
The payroll and production supervisors of Butter Bean Company were caught misappropriating cash through
payroll fraud. To prevent this from happening again, the most proper control to implement is

Selected Answer:  
having pay checks directly deposited to employees' bank (payroll) accounts.
Answers: having backup procedures to reduce risk of data loss.
having subsidiary and GL accounts.
having password protected payroll files.
 
having pay checks directly deposited to employees' bank (payroll) accounts.
 Question 46
2 out of 2 points
The president of Sky Corp. suspects that there are problems in the payroll process because some employees have
unauthorized access to payroll records and confidential employee data. The most appropriate control to address
this is

Selected  
Answer: having multilevel security techniques that control access to human resources, accounts payable,
cash disbursements, cost accounting and general ledger.
Answers: having the supervisor observe timekeeping and reconcile time cards with actual attendance.
having personnel action forms to help payroll keep employee records current.
 to implement limit test to detect excessive hours reported per period.
 
having multilevel security techniques that control access to human resources, accounts payable,
cash disbursements, cost accounting and general ledger.
 Question 47
2 out of 2 points
A supervision control to address fixed asset system risks involves

Selected  
Answer: the management overseeing the physical security of fixed assets.
Answers: the internal auditor reviewing the asset acquisition and approval procedures to determine the
reasonableness of factors used in such decisions.
verifying the location, condition, and fair value of fixed asset against the fixed asset records in
the subsidiary ledger.
testing the programming logic for automatic calculations (depreciation).
 
the management overseeing the physical security of fixed assets.
 Question 48
2 out of 2 points
You are a newly-hired external auditor of Suzie and Petro Auditing Firm. You are assigned to perform a fixed
asset count for Gazelle Co. Which of the following information in the fixed asset record structure will be most
relevant to you?

Selected Answer:  
item number, location, and description
Answers: asset type, asset life, and cost
residual value, deprecation method, and period/month
retirement date, accumulated depreciation and book value depreciation schedule.
 
item number, location, and description
 Question 49
2 out of 2 points
The first step in the asset maintenance procedures is

Selected Answer:  
computing the current period's depreciation.
Answers: updating the accumulated depreciation and book-value figures in the subsidiary records.
posting total depreciation to the related GL accounts.
 
computing the current period's depreciation.
recording the depreciation transaction by placing a record to the journal voucher file.
 Question 50
0 out of 2 points
 Which document or accounting record contains the total time worked each pay period for payroll calculation?

Selected Answer:  
Labor distribution summary
Answers: Labor distribution summary
Personnel action form
 
Time card
Job ticket

 Question 1
2 out of 2 points
The document that triggers the recording of a liability in the process of inventory
purchase
Selected Answer:  
supplierâ s invoice
Answers: purchase requisition
 
supplierâ s invoice
receiving report
purchase order
 Question 2
0 out of 2 points
The financial value of a purchase is determined by reviewing the
Selected Answer:  
purchase requisition
Answers: packing slip
 purchase requisition
receiving report
 
supplierâ s invoice
 Question 3
2 out of 2 points
Due to time delays in receiving inventory and journalizing
Selected Answer:  
liabilities are usually understated
Answers: liabilities are usually overstated
liabilities are usually correctly stated
 
liabilities are usually understated
liabilities are not affected.
 Question 4
2 out of 2 points
Customers should be billed for back-orders when
Selected Answer:  
the back-ordered goods are shipped
Answers:  
the back-ordered goods are shipped
the customer purchase order is received
the original goods are shipped
customers are not billed for back-orders because a back order is a
lost sale
 Question 5
2 out of 2 points
In a merchandising firm, authorization for the purchase of inventory is the
responsibility of
Selected Answer:  
inventory control
Answers: purchasing
accounts payable
 
inventory control
cash disbursements
 Question 6
2 out of 2 points
 What department should accept goods returned by customers?
Selected Answer:  
receiving
Answers:  
receiving
accounting
finance
guard
 Question 7
2 out of 2 points
An example of access control
Selected Answer:  
locked showcases to display jewelry and costly electronic
equipment
Answers: anyone can enter the warehouse
invoices inside a common drawer
mailroom is accessible to all office personnel
 
locked showcases to display jewelry and costly electronic
equipment
 Question 8
2 out of 2 points
Which of the following functions should be segregated?
Selected  
Answer: opening the mail and making the journal entry to record cash receipts
Answers: Authorizing credit and determining reorder quantities
Maintaining the subsidiary ledgers and handling customers queries
 
opening the mail and making the journal entry to record cash receipts
providing information on inventory levels and reconciling the bank
statement
 Question 9
2 out of 2 points
Type of control which is considered a compensating control
Selected Answer:  
supervision
Answers: Access control
  
supervision
segregation of duties
accounting records
 Question 10
2 out of 2 points
The shipping notice
Selected Answer:  
informs the billing department of the quantities shipped
Answers: is mailed to the customer
is a formal contract between the seller and the shipping
company
 
informs the billing department of the quantities shipped
is always prepared by the shipping clerk
 Question 11
2 out of 2 points
It is a control over risk of unauthorized inventory purchase
Selected Answer:  
automated purchase approval
Answers: request by the warehouse clerk
request and approved by production supervisor
scanner technology
 
automated purchase approval
 Question 12
2 out of 2 points
An advantage of real-time processing of sales is
Selected Answer:  
current inventory information is available
Answers:  
current inventory information is available
the cash cycle is lengthened
hardcopy documents provide a permanent record of the transaction
data entry errors are corrected at the end of each batch
 Question 13
2 out of 2 points
 The customer open order file is used to
Selected Answer:  
respond to customer
queries
Answers: fill the customer order
ship the customer order
 
respond to customer
queries
authorize customer credit
 Question 14
2 out of 2 points
The billing department is responsible for
Selected Answer:  
notifying accounts receivable of the sale
Answers: updating the inventory subsidiary ledgers
prepares the bill of lading
prepares the check
 
notifying accounts receivable of the sale
 Question 15
2 out of 2 points
The receiving department is responsible to
Selected Answer:  
safeguard goods until they are transferred to the warehouse
Answers: Order goods from vendors
 
safeguard goods until they are transferred to the warehouse
record items in the accounting control account
store the goods received in the warehouse for their control
 Question 16
2 out of 2 points
The file that revenue cycle utilizes
Selected Answer:  
credit memo file
Answers: cost data reference file
 
 credit memo file
order goods from vendors file
archive file
 Question 17
2 out of 2 points
To maintain a good credit rating and to optimize cash management, cash
disbursements should arrive at the vendorâ s place of business
Selected Answer:  
before the discount date
Answers: as soon as possible
on the due date
 
before the discount date
by the end of the month
 Question 18
2 out of 2 points
Authorization for payment of an accounts payable liability is the responsibility of
Selected Answer:  
accounts payable
Answers: Inventory control
 
accounts payable
purchasing
cash disbursements
 Question 19
2 out of 2 points
The receiving report is used to
Selected  
Answer: accompany physical inventories to the warehouse
Answers: advise the purchasing department of the dollar value of the goods
delivered
advise general ledger of the accounting entry to be made
advise the vendor that the goods arrived safely
 
accompany physical inventories to the warehouse
 Question 20
2 out of 2 points
 The purpose of the purchase requisition is to
Selected Answer:  
authorize the purchasing department to order goods
Answers: order goods from vendors
 
authorize the purchasing department to order goods
record receipt of goods from vendors
bill for goods delivered
 Question 21
2 out of 2 points
The data processing method that can shorten the cash cycle is
Selected Answer:  
real-time file processing
Answers: batch, sequential file processing
 
real-time file processing
batch, direct access file processing
EDI
 Question 22
2 out of 2 points
The greatest risk of INVENTORY (not cash) theft occurs
Selected Answer:  
both receiving and warehouse
Answers: in the receiving department
in the warehouse
in the mailroom
 
both receiving and warehouse
 Question 23
2 out of 2 points
The purchase order
Selected Answer:  
indicates item description, quantity and price
Answers: is the source document to make an entry into the accounting records
 
indicates item description, quantity and price
is prepared by the inventory control department
 is approved by the end-user department
 Question 24
2 out of 2 points
A good internal control in the revenue cycle system is
Selected Answer:  
credit is authorized
Answers: all sales are profitable
override on unfavorable credit checking
backlog in recording sales
 
credit is authorized
 Question 25
2 out of 2 points
The document with least importance in the determination of the financial value of a
purchase because it does not signify a final order
Selected Answer:  
purchase requisition
Answers: receiving report
purchase order
supplierâ s invoice
 
purchase requisition
 Question 26
2 out of 2 points
the reason that a blind copy of the purchase order is sent to receiving is to
Selected Answer:  
force a count of the items delivered
Answers: Inform receiving when a shipment is due
Inform receiving of the type, quantity, and price of items to be
delivered
Require that the goods delivered are inspected
 
force a count of the items delivered
 Question 27
2 out of 2 points
The word â integratedâ in the fully integrated modules on the commercial accounting
systems means
Selected  
 Answer: transfer of information among modules occurs automatically
Answers: Segregation of duties is not possible
 
transfer of information among modules occurs automatically
batch processing is not an option
separate entries are made in the general ledger accounts and the
subsidiary ledgers
 Question 28
2 out of 2 points
The revenue cycle consists of
Selected  
Answer: two subsystems-sales order processing and cash receipts
Answers: three subsystems-sales order processing, credit authentication, and
cash receipts
 
two subsystems-sales order processing and cash receipts
one subsystem-order entry
two subsystems-order entry and inventory control
 Question 29
2 out of 2 points
A weekly reconciliation of cash receipts will include comparing
Selected Answer:  
the cash prelist with bank deposit slips
Answers: bank deposit slips with remittance advices
journal vouchers from accounts receivable and general ledger
 
the cash prelist with bank deposit slips
the cash prelist with remittance advices
 Question 30
2 out of 2 points
The purpose of the sales invoice is to
Selected Answer:  
bill the customer
Answers: transfer goods from seller to shipper
record reduction of inventory
select items from inventory for shipment
 
 bill the customer
 Question 31
2 out of 2 points
The adjustment to accounting records to reflect the decrease in inventory due to a
sale occurs in the
Selected Answer:  
inventory control
department
Answers: billing department
 
inventory control
department
warehouse
shipping department
 Question 32
2 out of 2 points
A remittance advice is
Selected Answer:  
is a turnaround document
Answers: used to increase (debit) an account receivable by the cash received
 
is a turnaround document
is copy of the customer as proof of payment
tracking slip
 Question 33
2 out of 2 points
The purpose of the receiving report is to
Selected Answer:  
record receipt of goods from vendors
Answers: order goods from the vendors
bill for goods delivered
authorize the purchasing department to order goods
 
record receipt of goods from vendors
 Question 34
2 out of 2 points
The document that will close the open purchase requisition file is the
Selected Answer:  
 receiving report
Answers: purchase order
 
receiving report
vendor invoice
payment voucher
 Question 35
2 out of 2 points
The most effective internal control procedure to prevent or detect the creation of
fictitious credit memoranda for sales returns is to
Selected Answer:  
require management approval for all credit memoranda
Answers:  
require management approval for all credit memoranda
pre-numbered and sequence check all credit
memoranda
limit access to credit memoranda
supervise the accounts receivable department
 Question 36
2 out of 2 points
The receiving report
Selected Answer:  
accompanies the goods to the storeroom
Answers: is used to update the actual cost inventory ledger
is sent to general ledger
 
accompanies the goods to the storeroom
is returned to the vendor to acknowledge receipt of the goods
 Question 37
2 out of 2 points
Journal used in the revenue cycle
Selected Answer:  
general journal
Answers: purchase journal
 
general journal
cash disbursement journal
 payroll register
 Question 38
2 out of 2 points
In an integrated cash receipts system the mail room clerk
Selected Answer:  
reconciles checks and remittance advices
Answers: make bank deposit
post payment in the accounts receivable subsidiary ledger
 
reconciles checks and remittance advices
prepare bank reconciliation
 Question 39
2 out of 2 points
The printer ran out of preprinted sales invoice form and several sales invoices were
not printed. The best internal control to detect the error is
Selected  
Answer: a batch total of sales invoices to be compared to the actual number of
sales invoices prepared
Answers: sequentially numbered sales invoices
 
a batch total of sales invoices to be compared to the actual number of
sales invoices prepared
visual verification that all sales invoices were prepared
error cannot be detected
 Question 40
2 out of 2 points
When a copy of the receiving report arrives in the purchasing department, it is used
to
Selected Answer:  
recognize the purchase order as closed
Answers:  
recognize the purchase order as closed
adjust perpetual inventory records
record the physical transfer of inventory from receiving to the
warehouse
analyze the receiving departmentâ s process
 Question 41
2 out of 2 points
 Adjustment to accounts receivable for payments received from customers is based
upon
Selected Answer:  
the remittance advice that accompanies payments
Answers: the customerâ s check
a memo prepared in the mail room
the cash prelist
 
the remittance advice that accompanies payments
 Question 42
2 out of 2 points
The cash disbursement function is
Selected Answer:  
treasury function
Answers: part of accounts payable
an independent accounting function
 
treasury function
general accounting function
 Question 43
2 out of 2 points
The document that triggers the revenue cycle
Selected Answer:  
the customer purchase order
Answers: the sales order
the journal vouchers
 
the customer purchase order
the sales invoice
 Question 44
2 out of 2 points
Ideally the open voucher payable file is organized by
Selected Answer:  
payment due date
Answers: vendor
purchase order number
 
 payment due date
transaction date
 Question 45
2 out of 2 points
When a cash disbursement in payment of an accounts payable is recorded
Selected Answer:  
the liability account is decreased
Answers: the liability account is increased
 
the liability account is decreased
the income statement is changed
the cash account is not changed
 Question 46
2 out of 2 points
The reconciliation that occurs in the shipping department is intended to ensure that
Selected Answer:  
the goods shipped match the goods ordered
Answers:  
the goods shipped match the goods ordered
credit have been approved
the customer is billed for the exact quantity shipped
inventory records are reduced for the goods shipped
 Question 47
2 out of 2 points
It indicates a weak internal control structure
Selected  
Answer: the mailroom clerk authorizes credit memos
Answers:  
the mailroom clerk authorizes credit memos
the accounts receivable clerk prepares customer statements every
month
the record keeping clerk maintains both accounts receivable and
accounts payable SLs
the warehouse clerk obtains a signature before releasing goods for
shipment
 Question 48
2 out of 2 points
The credit department
 Selected Answer:  
authorizes the granting of credit to customers
Answers: approves credits to accounts receivable when payments are
received
prepares credit memos when goods are returned
 
authorizes the granting of credit to customers
updates the accounts receivable subsidiary ledger
 Question 49
2 out of 2 points
In a firm with proper segregation of duties, adequate supervision is most critical in
Selected Answer:  
receiving
Answers: Purchasing
 
receiving
accounts payable
general ledger
 Question 50
2 out of 2 points
Of the following duties, it is most important to separate
Selected Answer:  
warehouse from inventory control
Answers: warehouse from stores
accounts payable and accounts receivable
 
warehouse from inventory control
purchasing and accounts receivable