Answer the questions (MCQ can be multiple):

\f20. Homer can management reasonablyr ensure that business activities are 2 points performed in accordance with their objectives? D Oversee each errployee sufcieme to ensure that hershe is performing all hisi'her duties correctly D Spot check each employee to ensure that hefshe is performing hisr'her duties correctly Provide each employee with written descriptions of company procedures. Periodically D evaluate each employee's perfonnance w'rih regard to compliance with company procedures. D None of the above 21. A scheme where the perpetrator steals the cash or check that 2 points customer A mails in to pay its accounts receivable. then the perpetrator takes the funds from customer B to later cover that account. And so on with Customer (I. D Computer fraud Employee fraud Kiting DUI: Lapping 22. I|rr"l."hich of the following creates an environment where computer fraud 2 points is less lilrretyr to occur? D Hire employees I.Iirithout adequate security and criminal cheeks. Assume that corporate security policies are understood by all employees. Increase the penalties for committing fraud. DDl: None of the atroy 25. In order for an act to be legally considered fraud it must be all of the 2 points following except D A material fact. Justifiable reliance. A false statement. No intent to deceive. DDDl: An injury or loss suffered by the victim. 2+3. According to the opportunityr part of the fraud triangle. a person may do all of the following acts except: Comrert the theft or misrepresentation for personal gain. Control the fraud. Commit the fraud. Conceal the fraud. DDDl: 2?. Which of the following pressures are classified as Management Characteristics that can lead to financial statemerrl fraud? High management andfor employee tumoyer Declining industry New regulatory requirements that impair financial stability or profitability DDDl: Intense pressure to meet or exceed earnings expectations 2 points 2 points 28. All of the following are classification of computer fraud except: 2 points Input fraud. Reconciliation fraud. Computer instructions fraud. Processor fraud. Output fraud. 29. Which of the following actions are used to reduce fraud losses? 2 points Implement a fraud hotline. Conduct periodic external and internal audits. Maintain adequate insurance. Develop a strong system of internal controls. 30. Which of the following is considered a financial pressure that can lead 2 points to employee fraud? Gambling habit. Greed. Poor credit ratings. Job dissatisfaction.\f33. The purpose of segregating the duties of hiring personnel and 2 points distributing payroll checks is to separate the Authorization of transactions from the custody of related assets. Operational responsibility from the recordkeeping responsibility. Human resources function from the controllership function. Administrative controls from the internal accounting controls. 34. Which of the following internal control procedures most likely would 2 points be used to maintain accurate inventory records? Perpetual inventory records are periodically compared with the current cost of individual inventory items. A just-in-time inventory ordering system to keep inventory levels to a desired minimum. Requisitions, receiving reports, and purchase orders are independently matched before payment is approved. Periodic inventory counts are used to adjust the perpetual inventory records.35. Tracing shipping documents to pre-numbered sales invoices provides 2 points evidence that No duplicate shipments or billings occurred. Shipments to customers were properly invoiced. All goods ordered by customers were shipped. All pre-numbered sales invoices were accounted for 36. Which of the following are factors associated with the control 2 points environment? 1. Commitment to competence 2.Participation of those charged with governance 3.Ethical values and integrity 1, Il, and Ill I and Il only II and Ill only | and Ill only37. The authority to accept incoming goods in receiving should be based 2 points on a (an) Vendor's invoice. Materials requisition. Bill of lading. Approved purchase order. 38. Tracing copies of computer-prepared sales invoices to copies of the 2 points corresponding computer-prepared shipping documents provides evidence that Shipments to customers were properly billed. Entries in the accounts receivable subsidiary ledger were for sales actually shipped. Sales billed to customers were actually shipped. No duplicate shipments to customers were made.39. Which of the following components of internal control best describes 2 points the process of requiring a key card to enter the warehouse? Control environment. Monitoring. Risk assessment. Control activities. 40. How do the scope, procedures, and purpose of an examination of 2 points internal control compare to those for obtaining an understanding of internal control and assessing Risk of Material Misstatement as part of an audit? Similar scope, different procedures, and similar purpose. Different scope, similar procedures, and similar purpose. Different scope, different procedures, and different purpose. Different scope, similar procedures, and different purpose. 41. In a properly designed internal control structure, the same employee 2 points most likely would match vendors' invoices with receiving reports and also Post the detailed accounts payable records. Recompute the calculations on vendors' invoices. 0 Reconcile the accounts payable ledger. Cancel vendors' invoices after payment.31. Write a memo: You have a new client. l'vls. Amy Pembertoh. 'who is in 213 points the process of forming a new company and has asked your assistance in developing a system of internal control. She would like to start off on a very positive note and is veryr concerned about promoting ethical behavior within her company.She has been reading about (2050's integrated framework and is curious as to what she should do to make certain that she establishes the appropriate control environment. She would like you to describe the control environment componeth of internal control and the ve principles that relate to it REMINDER: Your response will be graded for both technical content and writing skills. Technical content will be evaluated for information that is helpful to the intended reader and clearlyr relevant to the issue. Writing skills will be evaluated for development. organization. and the appropriate expression of ideas in professional correspondence. Use a standard business memo or letter format with a clear beginning. middle. and end. Do not convey information in the form of a table. bullet point list. or other abbreviated presentation. Start by using following format: Memorandum To: his Amy pemberton Re: The control environment and its underlying prinicples 1ll'oILIr answer \f\f8. Dell is repairing computers 2 points Inbound Outbound Operation Marketing and sales Service 9. Management's decisions to optimize the profitability of the company is 2 points an important is an important function of AIS. yes No10. 1ir'll'hile an accounting information system supports each of the 2 points organization's primary activities in the value chain as well as many of the support activities, it can only be categorized into one of the activities. Into which activity is the accounting information system categorized? 'I1. List characteristics of information 1with brief description and example of 4 points each characteristic. * YUUF EHSWEF 12. A manual AIS begins with the capture of information from source 2 points documents. These source documents could vary from scraps of paper to notepads or even blackboards. However, transaction data are most easily;r and effectiver captured if the source documents are well designed. Which of the following is not an element of a welldesigned source document? I:| Use preprinted data to the maximum extent possible I:| Minimize the use of codes and checkcffs 13. Numerous journals are available for the recording of transactions. In 2 points which journal would one record the purchase of a new piece of equipment for use in production? 14. The posting process 2 points neyer generates more than one posting for each transaction occurs as needed is used to place postit notes on all items that need attention is used to meter the outgoing mail IIIIIICICICI summarizes the amounts recorded in the journals to the ledgers 15. One of the three basic functions of an AIS is to collect and store data 2 points about the organization's business activities and transactions efficiently and effectively. In a manual system the process of performing this function follows the order of: D source documents. journalizing. posting D posting. journalizing. source documents D journalizing. ledgerizing. posting D source documents. ledgerizing.joumalizing D source documents. ledgerizing. posting 1s. A chart of account is 2 points D is a list of all accounts in the organization with each account identied by a three or four-digit code is used to summarize each customer's current balance provides an audit trail is a list of all permanent accounts in the organization. Terrporary accounts, such as revenue and expense accounts, are not included in the chart of accounts. None of the above USED 1?. An accounting information system produces more than financial 2 points statements. In fact. it is relied upon to produce detailed operational information about the organization's performance. Where are the data collected from to generate this operational information? D Customers Vendors Revenue Cycle Expendihle Cycle Product Cycle DDDDE All of theabo'ure 13. Management lavr exception: 2 points D is a technique of handsoff management] unless current performance does not meet the expectations established in the budget I: is a technique 'lvherebj.r exceptional performance is guaranteed D requires a periodic comparison of each unit's activities with past performance |:| None of the above 19. The third function of the AIS is to provide adequate internal controls to 2 points accomplish three basic objectives. Identify the improper objective. D Ensure that business activities are performed efficientlyr and in accordance with management's objectives while also conforming to any.r applicable regulatorv policies Safeguard organizational assets including its data Ensure that the information that is produced bv the svstem is relevant IIICICI Ensure that the information that is produced bv the svstem is reliable