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A) Signed by An Officer After Necessary Supporting Evidence Has Been Examined

The document discusses internal controls for cash disbursements, payroll procedures, and fixed asset management. It provides true/false questions about appropriate internal control procedures. An effective internal control for cash disbursements is requiring checks to be signed by an officer and reviewed before mailing. The audit trail for payroll should include time cards, payroll register, and subsidiary ledger accounts but not disbursement vouchers. Fixed asset acquisitions should be formally authorized in writing while disposal authorization should not come from the asset user.

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Venice Marie Arroyo
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40 views2 pages

A) Signed by An Officer After Necessary Supporting Evidence Has Been Examined

The document discusses internal controls for cash disbursements, payroll procedures, and fixed asset management. It provides true/false questions about appropriate internal control procedures. An effective internal control for cash disbursements is requiring checks to be signed by an officer and reviewed before mailing. The audit trail for payroll should include time cards, payroll register, and subsidiary ledger accounts but not disbursement vouchers. Fixed asset acquisitions should be formally authorized in writing while disposal authorization should not come from the asset user.

Uploaded by

Venice Marie Arroyo
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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1.

An effective internal control measure that protects against the preparation of


erroneous or inaccurate disbursements would be to necessitate that all checks be:
a) signed by an officer after necessary supporting evidence has been examined
b) perforated or otherwise effectively cancelled when they are returned with the bank
statement
c) numbered sequentially and accounted for by internal auditors
d) reviewed by the treasurer before mailing

2. In the preparation of the cash disbursement, which of the following procedure is not
included?
a) The cash disbursements clerk receives the voucher packet and reviews the documents for
completeness and clerical accuracy.
b) The clerk prepares a check and records the check number, dollar amount, voucher
number, and other pertinent data in the check register.
c) The clerk prepares a receiving report and records the details stating the quantity and
condition of the inventories.
d) The clerk marks the documents in the voucher packets paid and returns them to the
accounts payable clerk.

3. Human Resource Management (HRM) systems need to provide real-time access to


personnel files for purposes of direct inquiries and recording changes in employee
status as they occur. True

4. After cost accounting allocates labor costs to the work-in-process accounts, the charges
are summarized in a labor collection summary and forwarded to the general ledger
function. False

5. The audit trail for payroll includes the following documents except:
a) Time cards
b) Payroll register
c) Subsidiary ledger accounts
d) Disbursement vouchers
6. Vernon, a CPA audits a client’s payroll procedures. He would consider the internal
control to be less than effective if the payroll department supervisor was allocated the
duty regarding the?
a) reviewing and approving time reports for subordinate employees
b) distribution of payroll checks to employees
c) hiring of subordinate employees
d) initiation of requests for salary adjustments for subordinate employees

7. Fixed asset acquisitions should be formal and explicitly authorized wherein each
transaction should be initiated by a written request from the user or department. True

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

9. The fixed asset system uses the depreciation schedules to record end-of-period
depreciation transactions automatically. Hence, its specific tasks include all of the
following except:
a) calculating the previous period’s depreciation
b) posting the total amount of depreciation to the affected general ledger accounts
(depreciation expense and accumulated depreciation)
c) recording the depreciation transaction by adding a record to the journal voucher file
d) updating the accumulated depreciation and book value fields in the subsidiary records

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