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Chapter 6 The Expenditure Cycle Part II - MCQ

This document provides an overview of payroll processing and fixed asset procedures. It discusses topics such as time cards, payroll reconciliations, internal controls over payroll, departments responsible for pay rates and distributing paychecks. For fixed assets, it covers depreciation calculation and records, controls in the fixed asset system, objectives that do not include maintaining fair market value records, and characteristics that do not involve routine acquisition authorizations.

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441 views1 page

Chapter 6 The Expenditure Cycle Part II - MCQ

This document provides an overview of payroll processing and fixed asset procedures. It discusses topics such as time cards, payroll reconciliations, internal controls over payroll, departments responsible for pay rates and distributing paychecks. For fixed assets, it covers depreciation calculation and records, controls in the fixed asset system, objectives that do not include maintaining fair market value records, and characteristics that do not involve routine acquisition authorizations.

Uploaded by

Hads Luna
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Chapter 6 The Expenditure Cycle Part II: Payroll Processing and Fixed Asset Procedures

1. The document that captures the total amount of time 7. Depreciation


that individual workers spend on each production job a. is calculated by the department that uses the
is called a fixed asset.
a. time card. b. allocates the cost of the asset over its useful life.
b. job ticket. c. is recorded weekly.
c. personnel action form. d. results in book value approximating fair market
d. labor distribution form. value.

2. An important reconciliation in the payroll system is 8. Depreciation records include all of the following
when information about fixed assets EXCEPT the
a. the general ledger department compares the a. economic benefit of purchasing the asset.
labor distribution summary from cost accounting b. cost of the asset.
to the disbursement voucher from AP. c. depreciation method being used.
b. the personnel department compares the number d. location of the asset.
of employees authorized to receive a paycheck to
the number of paychecks prepared. 9. Which control is not a part of the fixed asset system?
c. the production department compares the number a. formal analysis of the purchase request
of hours reported on job tickets to the number of b. review of the assumptions used in the capital
hours reported on time cards. budgeting model
d. the payroll department compares the labor c. development of an economic order quantity
distribution summary to the hours reported on model
time cards. d. estimates of anticipated cost savings

3. Which internal control is not an important part of the 10. Objectives of the fixed asset system do NOT include
payroll system? a. authorizing the acquisition of fixed assets.
a. supervisors verify the accuracy of employee time b. recording depreciation expense.
cards c. computing gain and/or loss on the disposal of
b. paychecks are distributed by an independent fixed assets.
paymaster d. maintaining a record of the fair market value of all
c. the AP department verifies the accuracy of the fixed assets.
payroll register before transferring payroll funds
to the general checking account 11. Which of the following is NOT a characteristic of the
d. the general ledger department reconciles the fixed asset system?
labor distribution summary and the payroll a. acquisitions are routine transactions requiring
disbursement voucher general authorization
b. retirements are reported on an authorized
4. The department responsible for approving pay rate disposal report form
changes is c. acquisition cost is allocated over the expected life
a. payroll of the asset
b. treasurer d. transfer of fixed assets among departments is
c. personnel recorded in the fixed asset subsidiary ledger
d. cash disbursements

5. Which function should distribute paychecks?


a. personnel
b. timekeeping
c. paymaster
d. payroll

6. Which transaction is not processed in the fixed asset


system?
a. purchase of building
b. repair of equipment
c. purchase of raw materials
d. sale of company van

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