Financial Accounting
14th Edition
ISBN: 9781305088436
Author: Carl Warren, Jim Reeve, Jonathan Duchac
Publisher: Cengage Learning
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Question
Chapter 8, Problem 1PEB
To determine
Identify the internal control elements.
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Internal controls do each of the following except:
A. Evaluate performance of employees
B. Guarantee the accuracy if account records
C. Protect assets
D. Increase the likelihood that any errors will be caught
Identify each of the following as relating to (a) the control environment, (b) control procedures, or (c) monitoring:1. Hiring of external auditors to review the adequacy of controls2. Personnel policies3. Safeguarding inventory in a locked warehouse
Internal Control Elements
Identify each of the following as relating to the control environment, control procedures, or monitoring:
1.
Hiring of external auditors to review the adequacy of controls
2.
Personnel policies
3.
Safeguarding inventory in a locked warehouse
Chapter 8 Solutions
Financial Accounting
Ch. 8 - Prob. 1DQCh. 8 - Why should the employee who handles cash receipts...Ch. 8 - Prob. 3DQCh. 8 - Why should the responsibility for maintaining the...Ch. 8 - Assume that Brooke Miles, accounts payable clerk...Ch. 8 - Prob. 6DQCh. 8 - Prob. 7DQCh. 8 - Prob. 8DQCh. 8 - Prob. 9DQCh. 8 - Prob. 10DQ
Ch. 8 - Prob. 1PEACh. 8 - Prob. 1PEBCh. 8 - Prob. 2PEACh. 8 - Prob. 2PEBCh. 8 - Prob. 3PEACh. 8 - Prob. 3PEBCh. 8 - Prob. 4PEACh. 8 - Prob. 4PEBCh. 8 - Financial data for Otto Company follow: a....Ch. 8 - Prob. 5PEBCh. 8 - Prob. 1ECh. 8 - Prob. 2ECh. 8 - Prob. 3ECh. 8 - Pacific Bank provides loans to businesses in the...Ch. 8 - Prob. 5ECh. 8 - An employee of JHT Holdings, Inc., a trucking...Ch. 8 - Prob. 7ECh. 8 - Prob. 8ECh. 8 - Prob. 9ECh. 8 - Prob. 10ECh. 8 - Prob. 11ECh. 8 - Prob. 12ECh. 8 - Prob. 13ECh. 8 - Abbe Co. is a small merchandising company with a...Ch. 8 - Prob. 15ECh. 8 - Prob. 16ECh. 8 - Prob. 17ECh. 8 - Prob. 18ECh. 8 - Prob. 19ECh. 8 - Prob. 20ECh. 8 - Prob. 21ECh. 8 - Prob. 22ECh. 8 - Prob. 23ECh. 8 - Prob. 24ECh. 8 - Mattel, Inc., designs, manufactures, and markets...Ch. 8 - El Dorado Inc. has monthly cash expenses of...Ch. 8 - Prob. 27ECh. 8 - Amicus Therapeutics, Inc., is a biopharmaceutical...Ch. 8 - Prob. 1PACh. 8 - Cactus Restoration Company completed the following...Ch. 8 - Prob. 3PACh. 8 - Prob. 4PACh. 8 - Prob. 5PACh. 8 - Prob. 1PBCh. 8 - Cedar Springs Company completed the following...Ch. 8 - Prob. 3PBCh. 8 - Prob. 4PBCh. 8 - Prob. 5PBCh. 8 - During the preparation of the bank reconciliation...Ch. 8 - Prob. 2CPCh. 8 - Prob. 3CPCh. 8 - Prob. 4CPCh. 8 - Prob. 5CPCh. 8 - TearLab Corp. is a health care company that...
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Similar questions
- Testing a company's internal controls through inspection of documents to see if approval or other checking was performed is specifically referred as ________. a. Documents Trial b. No Trial c. Audit Test d. Test of Controlsarrow_forwardSelect the appropriate control activities for each of the following definitions. Definitions Control Activities a. The company should maintain security over assets and accounting records. Management should periodically determine whether the amounts of physical b. assets of the company match the accounting records. The company should provide employees with appropriate guidance to ensure C. they have the knowledge necessary to carry out their job duties. The actual performance of individuals or processes should be checked against d. their expected performance. Authorizing transactions, recording transactions, and maintaining control of the е. related assets should be separated among employees. To prevent improper use of the company's resources, only certain employees are allowed to carry out certain business activities.arrow_forwardKent manages the physical goods inventory in the warehouse and he also maintains the accounting records of the inventory held there. Which of the following internal control activities have been violated? A. Establishment of authorization B. Segregation of duties C. Documentation and record keeping procedures D. Checks on recorded amountsarrow_forward
- When planning the audit of internal controls for an issuer, the audit team shoulda. Identify significant accounts, locations, and assertions.b. Conduct a walkthrough of the internal control process.c. Make inquiries of employees regarding the existence of control activities.d. Reperform control activities performed by client employees to determine theireffectiveness.arrow_forwardFrom a risk perspective, the PRIMARY objective for classifying data is: a) To ensure the completeness of the company's data inventory b) Establish appropriate control measures, depending upon the asset classification level. c) To support user account administration procedures. d) To limit access to personally identifiable informationarrow_forward1. The primary objective of internal controls in the expenditure cycle is to: A. Ensure the accuracy and completeness of financial transactions B. Streamline the procurement process C. Minimize the cost of purchases D. Increase the speed of payment processing 2. An example of a preventive control in the expenditure cycle is: A.Requiring management approval for large purchases B. Regular inventory counts C. Using firewalls and intrusion detection systems D. Conducting vendor audits 3. Which of the following is an example of a processing control in the expenditure cycle? A. Document sequencing B. Reconciling the bank statement C. Physical controls over inventory D. Approval of vendor invoices 4. Purchase orders are used to initiate a payment in the disbursement cycle.True False 5. An automated approval workflow for payment processing eliminates the need for managerial oversight and authorization. True or Falsearrow_forward
- Internal Control Elements Identify each of the following as relating to the control environment, control procedures, or information and communication: 1. Organizational structure 2. Report of company's conformity with environmental laws and regulations 3. Proofs and security measuresarrow_forwardWhich of the following is a device designed to help the audit team obtain evidence about theaccounting and control activities of an audit client?a. A narrative memorandum describing the control system.b. An internal control questionnaire.c. A flowchart of the documents and procedures used by the company.d. All of the abovearrow_forward"In order to determine whether internal control operated effectively to minimize errors of failure to invoice a shipment, the auditor would select from a sample of transactions from the population represented by the" Customer order file. Bill of lading file. Subsidiary-ledger Sales invoice filearrow_forward
- An example of a preventive control in the expenditure cycle is: A. Requiring management approval for large purchases B. Regular inventory counts C. Using firewalls and intrusion detection systems D. Conducting vendor audits.arrow_forwardThe internal audit function is part of what element of the internal control system? a.Risk assessment b.Control activities c.Control environment d.Monitoringarrow_forwardTo test the operating effectiveness of a control, an audit team might use a combination ofeach of the following tests except fora. Inquiry of client personnel.b. Observation of company operations.c. Confirmation of balances.d. Inspection of documentationarrow_forward
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