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web.groovymark@gmail.com
- December 12, 2024
Question 01
What is the primary function of a personnel action form in payroll systems?
A) To track employee attendance
B) To identify employees authorized to receive a paycheck
C) To reconcile payroll discrepancies
D) To update accounts payable
Answer: B) To identify employees authorized to receive a paycheck
Explanation: Personnel action forms document changes in employee pay rates, deductions, and job classifications, authorizing paycheck issuance.
Question 02
What does a payroll imprest account ensure in payroll systems?
A) Accurate tracking of employee time
B) Allocation of funds for all payroll payments
C) A single deposit for the entire payroll amount
D) Automatic calculation of overtime pay
Answer: C) A single deposit for the entire payroll amount
Explanation: Payroll imprest accounts ensure that a single check for the total payroll amount is deposited into the account for disbursement to employees.
Question 03
What is the purpose of transaction authorization in internal control systems?
A) To prevent physical asset theft
B) To ensure transactions are approved before processing
C) To monitor system performance
D) To control access to sensitive data
Answer: B) To ensure transactions are approved before processing
Explanation: Transaction authorization ensures that only valid and authorized transactions are processed, reducing the risk of fraud or errors.
Question 04
What type of internal control includes segregation of duties?
A) IT control
B) Physical control
C) Transaction control
D) Personnel control
Answer: B) Physical control
Explanation: Physical controls involve segregation of duties to reduce the risk of fraud by ensuring that different individuals are responsible for different aspects of a transaction.
Question 05
Answer: C) Comparing the purchase order, receiving report, and supplier’s invoice
Explanation: A three-way match helps verify that the goods or services received match what was ordered and invoiced, ensuring payment accuracy.
Answer: C) A record of digital transactions and data flow
Explanation: Digital audit trails consist of electronic records of transactions that allow auditors to trace the flow of data through the system.
Question 06
What are the primary documents used in a three-way match for accounts payable?
A) Sales order, inventory receipt, cash receipt
B) Supplier’s invoice, receiving report, purchase order
C) Journal entry, sales order, bank statement
D) Tax form, ledger, customer receipt
Answer: B) Supplier’s invoice, receiving report, purchase order
Explanation: The three-way match compares these three documents to verify the legitimacy of the payment to vendors.
Question 07
Which internal control technique prevents one individual from having control over all aspects of a financial transaction?
A) Independent verification
B) Segregation of duties
C) Transaction processing
D) System auditing
Answer: B) Segregation of duties
Explanation: Segregation of duties ensures that no single individual can control the entire transaction process, reducing the risk of errors or fraud.
Question 08
What is the main function of a reference file in accounting systems?
A) To store current transaction data
B) To maintain historical transaction records
C) To serve as a standard for processing transactions
D) To record employee payroll details
Answer: C) To serve as a standard for processing transactions
Explanation: Reference files contain data, such as tax tables, used as a standard to process various transactions.
Question 09
Which of the following best describes a payroll register?
A) A record showing employee job classifications
B) A document showing gross pay, deductions, overtime, and net pay
C) A ledger used to track accounts payable
D) A report detailing employee performance
Answer: B) A document showing gross pay, deductions, overtime, and net pay
Explanation: Payroll registers summarize employee wages, hours worked, deductions, and net pay.
Question 10
What is the purpose of archive files in accounting systems?
A) To generate real-time financial reports
B) To record current transactions
C) To retain records of past transactions for future reference
D) To store tax records
Answer: C) To retain records of past transactions for future reference
Explanation: Archive files store historical transaction data that may be required for audits, legal purposes, or future analysis.
Question 11
What is the primary function of a data dictionary in a database?
A) To store transaction data
B) To provide a description of every data element in the database
C) To generate payroll records
D) To manage network traffic
Answer: B) To provide a description of every data element in the database
Explanation: A data dictionary lists and describes all data elements, helping maintain consistency and control over database information.
Question 12
What type of system helps track labor, overhead, and raw material costs during production?
A) Cost accounting system
B) Inventory management system
C) Payroll system
D) General ledger system
Answer: A) Cost accounting system
Explanation: Cost accounting systems monitor and record the flow of costs such as labor, overhead, and materials during production.
Question 13
What is the key focus of detective controls in an accounting system?
A) To identify and expose undesirable events that elude preventive controls
B) To authorize all transactions before processing
C) To ensure all records are updated sequentially
D) To provide access to sensitive data
Answer: A) To identify and expose undesirable events that elude preventive controls
Explanation: Detective controls are used to identify and report any issues or discrepancies that occur, even after preventive measures have failed.
Question 14
Which of the following is an example of a core ERP application?
A) Word processing
B) Sales and distribution
C) Social media management
D) Web design
Answer: B) Sales and distribution
Explanation: Core ERP applications support essential business functions, such as sales, distribution, and production planning.
Question 15
Which document is prepared to adjust financial records for unrecorded transactions?
A) Payroll register
B) Adjusting journal entry
C) Sales invoice
D) General ledger
Answer: B) Adjusting journal entry
Explanation: Adjusting journal entries are used to correct financial records for unrecorded transactions, such as accrued expenses or depreciation.
Question 16
What system is designed to support internal decision-making with special-purpose reports?
A) Transaction Processing System (TPS)
B) Management Reporting System (MRS)
C) General Ledger System (GLS)
D) Expenditure Cycle System
Answer: B) Management Reporting System (MRS)
Explanation: The MRS provides specialized financial reports and information used for internal decision-making by managers.
Question 17
What type of risk does the International Computer Security Association (ICSA) address with its certification program?
A) Internal fraud
B) Firewall security from external hackers
C) Payroll discrepancies
D) Unauthorized employee access
Answer: B) Firewall security from external hackers
Explanation: ICSA certification focuses on firewall security to prevent unauthorized access to sensitive data from external threats.
Question 18
What type of internal control helps mitigate risks associated with access to physical assets?
A) Access control
B) Physical control
C) Preventive control
D) IT control
Answer: B) Physical control
Explanation: Physical controls include safeguarding physical assets, such as inventory and equipment, from unauthorized access or theft.
Question 19
What does the Better Business Bureau (BBB) Online seal represent?
A) Compliance with electronic transaction standards
B) Ethical business practices and customer protection
C) Data encryption and security verification
D) Financial reporting accuracy
Answer: B) Ethical business practices and customer protection
Explanation: The BBB Online seal signifies that a business complies with ethical standards, including honesty and transparency, in its dealings with customers.
Question 20
What is the primary purpose of a data redundancy test?
A) To prevent duplicate data entries
B) To verify data integrity across multiple databases
C) To detect missing records in a batch
D) To calculate control totals
Answer: A) To prevent duplicate data entries
Explanation: Data redundancy tests check to ensure that each transaction or record is processed only once, avoiding duplication.
