The Expenditure Cycle

Josh

100

Which of the following procedures is designed to prevent the purchasing agent from receiving kickbacks? A. Maintaining a list of approved suppliers and requiring all purchases to be made from suppliers B. Requiring purchasing agents to disclose any financial investments in potential suppliers C. Requiring approval of all purchase orders D. Prenumbering and periodically accounting for all purchase orders

C. Requiring approval of all purchase orders

200

Why is failing to catch errors in vendor invoices a problem? A.Underpayment for merchandise B.Reducing profitability C.Loss of assets D.Overpaying for merchandise

D. Overpay

300

Where should valuable company data be located? A.Off site B.Company site C.At least one backup on site and off site D.In a Flash drive

C. At least one backup on site and off site

400

Which document is used to record adjustments to accounts payable based on the return of unacceptable inventory to the supplier? A.Receiving report B.Credit Memo C.Debit Memo D.Purchase order

C. Debit Memo

Towfiq

100

For good internal control, who should sign checks? A. Cashier B. Accounts Payable C. Purchasing Agent D. Controller

A.Cashier

200

What is EDI? A.Electronic data interchange B.Electronic data interface C.Expenditure data interface D.Expenditure data interchange

A. Electronic Data Interchange

300

A log of all EDI transactions should be maintained and reviewed by: A.Board of Directors B.CEO C.An independent Party D.Your companies internal auditors

C. An independent party

400

What control procedures are required for EFTs? A.Passwords to monitor employees B.User IDs to monitor employees C.Transactions should be encrypted D.All of the Above

D. All of the Above

Kevin

100

Which of the following is not a control procedure for preventing stockouts and/or excess inventory? A.Inventory control systems B.Perpetual inventory needs C.Bar-code and RFID technology D.Ordering goods

D. Ordering goods

200

Which of the following is not a way to prevent check alterations and forgery? A.Use check protection machines that imprint amounts B.Print checks on colored paper C.Use inks that are difficult to alter D.Print checks on watermarked paper

B.Print checks on colored paper

300

The basic business activities performed in the expenditure cycle include the following? A. All of the below B. Ordering goods from suppliers C. Receiving goods from suppliers D. Approving vendor invoices for payment and paying for goods and services

A. All of the below

400

True or False: An Imprest fund does require vouchers for most disbursements

False

Manan

100

Which of the following threats does not involve the activity of ordered goods? A.Ordering Unnecessary items B.Purchasing goods at inflated prices C.Receiving unordered goods D.Purchasing goods of inferior quality

C. Receiving unordered goods

200

How many threats concern general control issues? A.1 B.2 C.3 D.4

B.2

300

What is ERS? A. Evaluated Receipts Settlement B. Enterprise Resource Service C. Enterprise Receipt Service D. Escort Rental Service

A. Evaluated Receipts Settlement

400

What are the alternate inventory control methods? A.Economic Order Quantity B.Enterprise Resource System C.All of the above D.None of the above

A. Economic Order Quantity

Bonus

100

What is a kickback? A.Expensive merchandise B.Gifts from suppliers to purchasing agents for the purpose of influencing their choice of suppliers C.Ordered goods D.Chilling on a couch

B. Gifts from suppliers to purchasing agents for the purpose of influencing their choice of suppliers

200

True or False: Storing unordered items in inventory can lead to excessive costs

True

300

Which of the following is not one of the Expenditure Cycle Information Needs? A. Determine when and how much additional inventory to order B. Select the appropriate suppliers from whom to order C. Verify the accuracy of vendor invoices D. Unauthorized disclosure of data

D. Unauthorized disclosure of data

400

What is not one of the threats talked about today? A.Making errors in counting goods received B.Misappropriating cash, checks, or EFTs C.Performing poorly D.Inventory Control

D.Inventory Control