Exam 3

Process fragmentation in production happens when A there are different production processes for different products B there are efficient handoffs between departments, teams, and systems C there is not a unified workflow for critical production processes. D different manufacturing teams handle different parts of the production process.

C

The first step of the financial reporting process, which occurs during the reporting period, is to A create journal entries B review adjusting journal entries C identify accounting transactions D locate source documents

C

The practice of shipping more goods to a distribution customer than the customer is likely to use a fraudulently inflate sales is called A excessive sales B cutoff fraud C channel stuffing D revenue recognition

C

The primary objective of financial reporting process is to A produce financial information for external auditors B increase profitabilty C produce statements containing information that is useful to external users D produce information used to create balanced scorecards

C

The procedures followed by the firm for ensuring payment of its accounts receivables are called its A discounted policy B credit policy C collections policy D payables policy

C

This accounting subdiscipline applies only to conversion processes. A managerial accounting B financial accounting C cost accounting D data analytics

C

What accounting method allocates indirect costs based on volume? A cash B accrual C conventional D activity-based

C

What document is sent back to the company when a B2B customer makes a payment? A receipt B bill of return C remittance advice D invoice

C

What is a purchase requisition? A legal contract to purchase goods from a vendor B request for payment to a vendor C request for the purchase of goods D document that opens a purchase order electronically

C

What is a source document for a data capture when a customer makes a request to buy goods? A pick request B inquiry program C sales order D intent to buy

C

What is the electronic system that facilitates financial transactions? A XBRL B Metro 2 C ACH D FDIC

C

What is the main result of insufficient inventory and finished goods? A spoilage issues B inaccurate inventory records C loss of revenue and cash flow D decreased production

C

Prior to the payment of an invoice, the following documents are matched as a control activity: A remittance advice, invoice, receiving report B invoice, purchase requisition, receiving report C purchase order, receiving report, invoice D purchase requisition, receiving report, remittance advice

C

What is the objective of production planning and scheduling? A increase cost efficiency B decrease excessive costs C provide the right product at the right time D reduce the number of defective products manufactured

C

What should management consider for each control activity? A time to implement B number of people to perform the activity C risk and cost versus benefit D profitability

C

When a parent company owns one or more subsidiaries, it prepares A data visualization dashboards B an enhanced statement of cash flows C consolidated financial statements D a balanced scorecard

C

Which activity does HR not perform? A updating and maintaining employee main table data B recruiting and hiring employees C directly supervising and assigning daily tasks to employees D terminating employees

C

Which control activity would best mitigate the risk of violation of employment laws for hiring new employees? A review of payroll journal B credible background checks C extension of offer letters only by the HR department D hands-on approach to onboarding new employees

C

Which control should be in effect before an order is accepted from credit customer? A have the customer agree to the payment type B enter a shipping address C conduct a credit check and review of the customer's payment history D have the customer pick a product to purchase

C

Which ledger accounts are impacted when payment is made to a vendor? A accounts receivable/cash B inventory/vendor payment C accounts payable/cash D current assets/vendor payment

C

Which of the following is a series of sequential numbers that are reserved for accounts? A blockchain B chart of accounts C block coding D primary key

C

Which of the following keywords does not indicate inappropriate journal entires meant to balance accounts? A reconcile B plug C allowance for doubtful accounts D true up

C

Which quality control activity generates an accounting transaction? A releasing products B inspecting products C scrapping defective products D testing products

C

Which sample control activity is best to mitigate the risk of incorrect employee data resulting in incorrect payments to the employee? A. Reviewing the payroll journal B. Reviewing the payroll calendar C. Reconciling the data in payroll records and HR main table D. Controller signing payroll checks

C

A master production schedule is most likely to be useful in A Identifying erroneous journal entries. B Inventory shrinkage. C Pricing of goods for sale. D Reducing excess production of inventory.

D

Depreciation expenses on fixed assets used in production for a reporting period are classified as A current assets B indirect materials C direct materials D manufacturing overhead

D

For revenue recognition purposes, when does a sale officially incur? A when a customer commits to buying a product B when the business produces the product for sale C when the shipping department preps the product for delivery D when ownership of goods is passed to the customer

D

Identify HR's next activity after the department manager contacts HR to discuss plans for an involuntary termination. A. Conduct an exit interview. B. Have the employee sign required documents. C. Collect the employee's badge and equipment. D. Provide a severance agreement to the employee's manager.

D

James Victor's Snickers Joke House hires illegal workers. Which of the core activities of the HR department should have identified and prevented this violation of law? A complying with laws and regulations B training and development C salaries and benefits D recruiting and hiring of employees

D

Recalculation of embedded calculations in database tables provides an auditor with additional assurance about _______ in the database. A truth B timeliness C lack of bias D reliability

D

The advantages of a higher level of maturity for payroll processing do not include A. having a single source of HR and payroll data. B. improving data accuracy. C. reducing data redundancies. D. having disparate or separate systems for HR and payroll.

D

The output of XBRL that users access to view the financial information is a(n) A style sheet B taxonomy document C interactive financial statement D instance document

D

What business activity must occur when a request is received for the purchase of unnecessary supplies? A reject the purchase order B tell the vendor not to ship the supplies C prepare the purchase requisition D reject the purchase requisition

D

What is the primary economic purpose of a company? A help employees love their job B fulfill goals C create opportunities for employees D maximize profits

D

When a machine in the factory is tagged for future identification purposes, which record is updated? A accounts payable subsidiary ledger B machinery ledger account C cash ledger account D fixed asset subsidiary ledger

D

Which of the following data analytics tests identifies instances of payroll processed after an employee's termination date? A. Duplicate payroll B. Exit interviews C. Wage equality D. Ghost employees

D

Which of the following describes a company's credit criteria? A. The length of time a buyer is given to pay for his/her purchases. B. The percentage of discount allowed for early payment. C. The diligence to collect slow-paying accounts. C. The required financial strength of acceptable customers.

D

Which of the following internal control activities would prevent an employee from being paid an inappropriate hourly wage? A. Having the supervisor of the data entry clerk verify that each employee's hours worked are correctly entered into the system B. Using real-time posting of payroll so there can be no after-the-fact data manipulation of the payroll register C. Giving payroll data entry clerks the ability to change any suspicious hourly pay rates to a reasonable rate D. Limiting access to the employee main table to authorized employees in the HR department

D

Which of the following is an example of cost-effectiveness? A building a product for the lowest possible expense B reviewing costs of operations for cost saving opportunities C balancing corporate profits with corporate losses D comparing the cost of creating useful information to the value it could provide

D

Which of the following is an overall equipment effectiveness (OEE) measure? A time spent on a job ticket B time spent developing a product C overall production run time D percentage of productive manufacturing time

D

Which of the following is not one of the four traditional dimensions of a balanced scorecard? A customer relationships B learning and growth C internal processes D research and development

D

Which transactions would create an increase in accounts payable? A selecting vendors B entering contracts C ordering resources D receiving raw materials

D

What is an electronic procurement system that integrates into an enterprise resource planning system to automate the purchase of raw materials based on demand?

E-procurement system (ERP)

Hamish works in a factory that builds tractors in Des Moines, Iowa. He can't remember whether the B352 or the C917 sprocket is needed in building a X793 tractor. The document, form, or screen that would help him decide is: A Bill of materials. B Materials requisition. C Move ticket. D Picking ticket.

A

How does a numerically controlled purchase order help an organization? A it created an audit trail B it is used to run a credit check C it ensures products are in stock D it enters customers into the database

A

Payroll accounting begins by recording ___ in the form of journal entries A business transactions involving an exchange of economic resources B financial information C corporate minutes D business contracts

A

The sales order table contains the Customer_ID, which comes from the customer table. In the sales order table the Customer_ID field is the A foreign key B primary key C composite key D relationship

A

What account is used to track the consumption of a fixed asset during a reporting period? A depreciation B accounts receivable C equity D cash

A

What are the most common targets of financial statement fraud? A revenues and receivables B revenues and expenses C short-term debt and cash D liabilities and current assets

A

What is a main use of employee onboarding analytics? A identify trends in feedback about HR employees B identify ongoing corporate issues C prepare tax filings D update new hire policies

A

What is the term for a digital duplicate of a physical object? A digital twin B carbon copy C backup D failover

A

What must businesses do before starting the financial reporting process? A develop a chart of accounts B identify accounting transactions C determine cash on hand D run baseline financial reports

A

Where are payments first recorded in the AIS? A cash disbursements journal B general ledger C bank reconciliation D invoices

A

Which HR process involves establishing a new employee in the company's systems? A employee onboarding B employee retention C new hire training D task model

A

Which of the following activities should occur next after HR receives the offer acceptance from a candidate? A. Submit data to background check provider. B. Send start date to IT department. C. Process notice of offer withdrawal. D. Review information for completeness.

A

A(n)____ is a piece of data assigned a tag by XBRL. A sheet B element C instance D taxonomy

B

An important follow-up internal control when management reviews reports is A restricting access to authorized users B documenting that the review was performed C sharing the review with all the internal stakeholders D scheduling the next review 18 months later

B

Companies use maturity models for assessing A how they audit their processes B how they judge their current performance and create plans for improvement C how they administer benefits D the efficiency of their onboarding processes

B

Concerns about IoT include all of the following except A reduced privacy B cycle times C data storage D risk exposure

B

What is an electronic system that serves financial institutions and facilitates financial transactions in the Unites States?

automated clearing house network (ACH)

What are control activities specific to the financial reporting process?

internal controls over financial reporting (ICFRs)

What involves overseeing the processes of ordering, storing, and using a business's inventory?

inventory management

What is the process that coordinates the communication of inventory availability and needs across the purchasing, conversion, and sales processes?

inventory management

What is a list of all approved vendors a company does business with?

main vendor table

What is a balance between controlling the costs of resources, rate of production, and quality of finished goods?

manufacturing efficiency

What is a source document that shows the specific calendar time when every production operation is scheduled to occur, the resources and workers assigned, and the steps required to utilize all resources effectively?

master production schedule (MPS)

What is the document that authorizes the movement of raw materials from inventory into production?

materials requisition request

What authorizes and tracks movements of a single manufacturing job from one location in production to another?

move tickets

What is a key performance indicator that measures how well production resources are used by identifying the percentage of productive manufacturing time?

overall equipment effectiveness (OEE)

What is an internal document that includes the vendor, amount due, and payment terms?

payment voucher

What focuses on paying for resources?

payments processes

What is the short-term allocation of plant machinery and resources to the manufacturing of products?

production scheduling

What is a request to obtain goods from an authorized source, and sends it to the purchasing department?

purchase requisition

What are focused on acquiring the necessary resources for a business to operate?

purchasing process

What process involves testing products to ensure that they meet regulatory and corporate specifications?

quality management

What shows the invoices included in the payment to the vendor?

remittance advice

The most important document in the billing process is the

sales invoice

What captures routine transactions that repeat often?

special journal

What is a type of fraud in which employees intentionally separate a single purchase into two or more purchase orders to stay within a single purchase authorization limit?

split purchase orders

What involves overseeing the life cycle of a product from procuring raw materials through customer sales?

supply chain management

What oversees the life cycle of a product from procuring raw materials through customer sales?

supply chain management

Which of the following best explains a trial balance rollforward? A it uses calculations to ensure that all the journal entries in the general ledger are present B it uses calculations to create the ending trial balance C it recalculates the beginning trial balance to perform a completeness test D it reperforms the work of internal auditors to provide external auditors with sufficient assurance over the general ledger

A

Which of the following generic business strategies seeks to be the low-cost producer in its industry? A cost leadership B differentiation C cost focus D differentiation focus

A

Which of the following is an example of a balanced scorecard customer relationships metric? A delivery performance B cash flow C employee turnover D process alignment

A

Which of the following is an example of a typical report for a credit sales process? A non-invoiced shipments B cash payments journal C accounts payable aging report D analysis of sales patterns to detect potential bid rigging

A

Which of the following is an example of a typical report for a purchasing process for inventory? A all goods received over a specified time period B cash receipts journal C accounts receivable aging analysis D bidding pattern analysis to detect potential bid rigging

A

Which of the following is the underlying language that eXtendible business reporting language uses? A XML B Java C HTML D python

A

Which of these departments is responsible for updating the general ledger for acquisitions and payments? A general accounting B accounts payable C receiving D requesting department

A

Which part of the inventory purchasing process involves the receiving department? A receiving inventory B ordering inventory C determining inventory to order D paying for inventory

A

Why are journal entries posted at unusual times considered a high fraud risk? A fraud perpetrators may post journal entries outside traditional working ours to avoid detection B they indicate a spike in revenue C fraud perpetrators do not work at the company and can only access the system outside traditional working hours D it is illegal to post a journal entry on Saturday

A

Within the context of the qualitative characteristics of accounting information, which of the following is a fundamental qualitative characteristic? A relevance B timeliness C comparability D confirmatory value

A

Consolidated financial statements are based on the concept that A In the preparation of financial statements, legal form takes precedence over economic substance. B In the preparation of financial statements, economic substance takes precedence over legal form. C Financial information should be presented separately for each legal entity. D Separate financial statements are more meaningful than consolidated financial statements.

B

Fictitious customers are an important risk of the A General ledger cycle. B Revenue cycle. C Financing cycle. D Expenditure cycle.

B

Financial reporting provides external stakeholders A shares of the company B an accurate depiction of company's financial situation C a clear determination on whether they should or should not invest in the company D a breakdown of key performance indicators

B

Hamish works in a factory that builds tractors in Des Moines, Iowa. He wants to get a B352 sprocket that is needed in building a X793 tractor. The document, form, or screen that would authorize this action is: A Bill of materials. B Materials requisition. C Move ticket. D Picking ticket.

B

How do fixed assets differ from current assets? A they are held for resale B they are used for more than one year C they are non-depreciating D they include short-term holdings

B

Name a major challenge in digital manufacturing. A eliminating manufacturing issues B cyber risk C maintaining equipment D flexibility

B

The objectives of financial reporting are based on which of the following sources? A the need for conservatism B the needs of the external users of the information C reporting on management's consistency D reporting on management's stewardship

B

The outsourced model helps HR perform the following kinds of value-driven tasks: A. Performing HR software development B. Promoting innovation, creativity, and flexibility in the work model C. Helping with HR and payroll audits D. Processing payroll

B

What do we call a network of intelligent devices that collect and analyze data? A intranet B industrial internet of things C data analytics D data warehouse

B

What does a cash flow statement provide to an organization? A a detailed list of items purchased B the impact of increases and decreases to cash C the current value of all assets D net operating losses for the month

B

What is a main use of employee termination analytics? A identify fraud in payroll B determine why employees tend to leave the organization C identify training opportunities D compare compensation packages

B

What is eXtensible business reporting language (XBRL)? A a programming language for creating web pages B a markup language for business information C a database querying language D a subset of data visualization language

B

What is the most important purpose of a balanced scorecard? A develop strategy B measure performance C develop cause-and-effect linkages D set priorities

B

What key role does HR play during the employee termination process? A tracking hiring violations B minimizing potential damages C helping employees pack up their items D removing system access

B

What type of production costing is used to assign costs to a unique or custom job? A process costing B job-order costing C standardized costing D just-in-time costing

B

Which business activity generates an accounting transaction? A scheduling production B manufacturing the product C testing the product D planning production

B

Which common practice motivates customers to pay their bills sooner? A free products B discount rates C lower interest rates D enhanced customer service

B

Which of the following ERP features is most important for the collections process? A accounts payable B accounts receivable C financial reporting D customer management

B

Which of the following balanced scorecard perspectives examines a company's success in targeted market segments? A financial B customer relationships C internal processes D learning and growth

B

Which of the following business activities generates an accounting transaction? A taking a customer order without an up-front payment B accepting a return from a customer C negotiating a contract D finalizing a marketing program

B

Which of the following is a violation of segregation of duties in internal control? A. An employee adds vendors and makes changes to a vendor master file. B. An employee enters and approves purchase orders. C. An employee matches invoices to purchase orders and receiving reports, and applies coding of account distributions. D. An employee receives goods from vendors and signs off on the deliveries.

B

Which of these dashboards is not used by management to monitor KPIs for production processes? A machine downtime causes B top five customers C defective products by reason D throughput

B

Which of these reports does not relate to production? A bill of materials B accounts payable agin analysis C machine downtime D bill of operations

B

Hildegard works at Amazon in the warehouse. What does she most likely use to assemble the goods for customers orders for shipping? A sales order B invoice C picking request D bill of lading

C

Which sample control activity is the best option for mitigating the risk of employee records remaining active in the payroll system? A. Executing a noncompete agreement B. Clearing all employee receivables C. Conducting independent reviews of the status of employee records D. Closing corporate card accounts

C

Who is the most likely perpetrator of financial statement fraud? A accounts receivable employees B audit committee C management D employees who handle cash

C

Why should payroll employees be separate from HR employees? A. payroll personnel may work fewer hours B. HR can better compensate employees C. It ensures segregation of duties to prevent fraud D. HR can focus on legal issues

C

_____ is used to trace expenses throughout the organization by aggregating expenses from departments up to the CEO. A digital tracing B block coding C responsibility accounting D consolidated balance sheet

C

Who is responsible for ensuring that revenue recognition practices comply with generally accepted accounting principles?

CFO and controller

What is a long-term outline of what and when the products will be manufactured?

Production planning

What is an accounting journal that contains a record of a company's payments, in chronological order?

cash disbursements journal

What occurs when revenue and profits are intentionally inflated by recognizing revenue from unnecessary sales in the current quarter or year?

channel stuffing

What lists the checks received from customers?

bank remittance report

What are the costs of acquiring fixed assets?

capital expenditures

What is the most liquid asset on the balance sheet?

cash

What document identifies variances between the receiving report and the purchase order?

discrepancy report

What is the process of establishing new employees in the company's system and helping them quickly adapt to their positions?

employee onboarding

What is the electronic transfer of payments and payment-related information like invoices, in a standardized, machine-readable format?

financial electronic data interchange (FEDI)

What includes land, land improvements, buildings, equipment and machinery used in production, office equipment, computer equipment, furniture and fittings, warehouse shelving, and vehicles?

fixed assets

What is for transactions that do not repeat often during a reporting period and for adjusting and closing entries?

general journal