____ 8.Failure to record the acquisition of goods and services directly affects the balance in accounts payable and may result in an overstatement of net income and owners' equity.

____ 9.The balance-related audit objective realizable value is not applicable when auditing accounts payable.

____ 10.A substantive test of transactions commonly used to test the completeness objective for acquisitions is "Trace from a file of receiving reports to the acquisitions journal."

____ 11.Auditors are normally more concerned about violations of the completeness objective for acquisitions than about violations of the existence objective for acquisitions.

____ 12.To test for overstatement cutoff amounts when auditing accounts payable, the auditor should trace receiving reports issued before year-end to related vendors' invoices to make sure they are not recorded as accounts payable.

____ 13.When verifying the correct balance in accounts payable, vendors' invoices are more useful than vendors' statements.

____ 14.The internal control "Adequate segregation of duties between accounts payable and custody of signed checks" relates most closely to the existence objective for cash disbursements.

____ 15. The audit procedure "Recompute hours worked from time cards" is normally performed when testing the completeness objective for payroll.

____ 16. When examining payroll transactions, an auditor is primarily concerned with the possibility of overpayments and unauthorized payments.

____ 17, An auditor vouched data for a sample of employees in a payroll register to approved clock card data to provide assurance that segregation of duties exist between the preparation and distribution of the payroll.

____ 18. Examining personnel records for accuracy and completeness is the best way for an auditor to determine that every name on a companys payroll is that of a bonafide employee presently on the job?

____ 19. Comparing selected items from the payroll register to employee time cards that have been approved by supervisory personnel tests is evidence of the occurrence assertion for payroll expense.

____ 20. Testing the inputs used in the valuation model is required of an auditor who is testing the fair value of options in share-based compensation:

____ 21. Effective internal control over unclaimed payroll checks that are kept by the Treasury Department would include Accounting Department procedures that require periodic accounting for the actual checks representing unclaimed wages.

____ 22. Payroll checks should be distributed by someone independent of the payroll and timekeeping functions.

____ 23. The deduction authorization form authorizes the rate of pay.

____ 24. When auditing the payroll and personnel cycle, tests of controls are rarely performed.

____ 25. For proper internal control, the person(s) responsible for signing the payroll checks should not have access to timekeeping or be otherwise involved in the preparation of payroll.

____ 26. The job time ticket indicates jobs on which the employee worked during the pay period.

____ 27. The use of an imprest payroll account prevents the loss from payment of unauthorized payroll to no more than the balance in the imprest account.

____ 28. For good internal control, the payroll function should be independent of the personnel department.

____ 29. Tests of controls and substantive tests of transactions are the auditor's most important means of verifying account balances in the payroll and personnel cycle.

____ 30. It is generally more difficult for the auditor to detect payment of fraudulent hours than payment of fictitious employees.