ACCOUNTING INFORMATION SYSTEMS
CONTROLS AND PROCESSES
TURNER / WEICKGENANNT
CHAPTER 10: Expenditures Processes and Controls – Payroll and Fixed Assets
TEST BANK - CHAPTER 10 - TRUE / FALSE
1. It is not necessary to get specific authorization for each individual routine transaction.
2. Routine transactions refer to common business transactions such as payroll and fixed asset
transactions.
3. Accounting for a fixed asset over the life of the asset would have features of non-routine
transactions only.
4. The payroll process starts when an employee is hired by the organization.
5. Members of management are not required to specifically approve an employee hired by the
company when the new employee has been screened by an employment office.
6. The hiring of employees is considered to be a routine process.
7. A hiring decision normally occurs as the result of an interview or interviews and is documented
on a signed letter and / or signed employment contract.
8. Amounts withheld from an employee paycheck will ultimately be paid to another vendor.
9. Most of the records found in an employee’s personnel file are accounting related.
10. A unique feature of the information contained in an individual personnel file is that it is
accessed infrequently but is changed relatively frequently.
11. It is common that personnel related expenses are one of the largest expenses reported on the
company’s income statement.
12. A challenging area of payroll computation is computing the amount of deductions related to
each employee’s pay.
13. Accounting software is available to assist with payroll but it is not very efficient because of all
the changes that occur to all payroll variables during the period.
14. Preparing payroll manually is extremely time consuming due to the process of extracting all
these inputs from the records and performing the mathematical computations.
15. Overtime hours are paid at a rate different from the regular hours, usually one and one-half
times the standard rate.
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Practice Multiple Choice Questions for Payroll, Sales and Collections, Acquisitions and Payment Processes
1. The internal auditor is reviewing shipping procedures of a manufacturing company. The auditor should be greatly concerned when a. merchandise is shipped without an approved customer's order. b.
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