Chapter 14 (ACCT-410)
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Chapter 14 (ACCT-410)

Course Number: ACCT 410, Spring 2010

College/University: MD University College

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14 Chapter Managing for Results TRUE/FALSE (CHAPTER 14) 1. Zero-based budgeting requires the periodic review of all programs, not just new ones. 2. It is difficult for accountants to have a role beyond auditing the financial statements of governments and not-for-profits. 3. Outputs is a term used to indicate the quantity or units of service provided by an activity. 4. One of the principal disadvantages of...

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Chapter 14 Managing for Results TRUE/FALSE (CHAPTER 14) 1. Zero-based budgeting requires the periodic review of all programs, not just new ones. 2. It is difficult for accountants to have a role beyond auditing the financial statements of governments and not-for-profits. 3. Outputs is a term used to indicate the quantity or units of service provided by an activity. 4. One of the principal disadvantages of zero-based budgeting is that it requires budgetary units to provide information that may never be used in the decision process. 5. Many of the benefits of program budgeting may be ascribed to the organizational selfexamination that it requires at the outset. 6. Most accounting organizations support the notion that performance measures should be included in generalpurpose annual financial reports. 7. The stated objective of the National Partnership for Reinventing Government is to reinvent government to work better, cost less, and to get Americans to care about it. 8. GASB SEA reporting proposals focus on measures of efforts, measures of accomplishments, and measures that relate efforts to accomplishments. 9. Rather than cash inflows, the potential benefits of many capital assets can be expressed as cash savings to governments and not-for-profits. 10. It is widely accepted that capital assets should be financed with resources on hand to achieve interperiod equity. ch14 Page 1 MULTIPLE CHOICE (CHAPTER 14) 1. In which of the following steps of the management cycle of governmental and not-for-profit entities are accountants least involved? a) Performing cost benefit analysis on proposed programs. b) Selecting among alternative programs. c) Preparing financial reports. d) Evaluating efficiency and effectiveness of programs. 2. Accountants are actively involved in collecting and analyzing data to be used by public policy makers. Which of the following other groups might also be involved in the data collection and analysis process? a) Statisticians. b) Economists. c) Program managers. d) All of the above. 3. Which of the following groups is least likely to be involved in evaluating the efficiency and effectiveness of government programs? a) Accountants. b) Legislators. c) Economists. d) Statisticians. 4. Which of the following is a true statement regarding the implementation phase of a government program? a) Internal accountants are not involved; only program managers are involved. b) Internal accountants are actively involved, preparing budgets, controlling costs, and preparing operating reports. c) Internal accountants have only a minor role, preparing reports for external parties. d) Internal accountants have final say in program choices. 5. Which of the following is NOT the role of policy makers in solving social problems? a) Selecting among options b) Developing alternatives. c) Appropriating resources required to implement programs d) Establishing expected goals. 6. All governments and notfor-profit entities should establish goals and objectives. Which of the following is a desirable characteristic of an operational objective? a) An operational objective should be open to interpretation. b) An operational objective should be measurable. c) An operational objective should be a statement of aspirations. d) An operational objective should be accomplishable by an unspecified future date. ch14 Page 2 7. An accounting program has determined that preparing students for careers in public accounting is the program's goal. Which of the following measurements is the best outcomes measurement for this accounting program? a) Number of accounting majors that graduate. b) Number of students that pass the CPA examination. c) Number of students in management positions in public accounting firms ten years after graduation. d) Number of students employed in public accounting within one year of graduation. 8. Which of the following groups are involved in auditing a program? a) Accountants. b) Statisticians. c) Economists. d) All of the above. Use the following information to answer Questions 9 and 10. A piece of federal legislation has as one of its objectives improving the health of older Americans. Title 20 of that legislation provides for granting federal funds to governmental or not-for-profit entities to provide nutritious hot meals to older Americans in congregate settings. Senior Citizens Center, a not-for-profit entity, receives funding under this legislation. The Center determines for one-month period, the following: Number of meals served Total number of individuals participating in the program Total meals costs incurred Average cost per meal 9. The numerical value that best represents outputs of this program is a) 400 b) $4.15 c) $860 d) None of the above. 10. The numerical value that best represents outcomes is a) 400 b) $4.15 c) $860 d) None of the above. 11. College professors are evaluated on teaching, research, and service. Which of the following would be a surrogate for the desired operational objective of "engaged in research that expands the horizons of knowledge." a) Value of research grants received. b) Number of publications in peer-reviewed journals. c) Both of the above. d) Neither of the above. 400 25 $860 $4.15 ch14 Page 3 12. At many colleges and universities, students are asked to evaluate the quality of instruction received and course content for all undergraduate courses. The evaluations are used for which of the following? a) As an outcome measure. b) As an output measure. c) As a surrogate for an outcome measure. d) As a surrogate for an output measure. 13. Because of the difficulty of measuring quality teaching, many colleges and universities rely heavily on student evaluations of the quality of instruction and accomplishment of course objectives. Which of the following is (are) a true statement(s)? a) This is a good practice, which may improve the quality of instruction. b) This is a good idea but may have unintended negative consequences by causing faculty to decrease the rigor of a course. c) Both are true. d) Neither is true. 14. Aid for Friends, a not-for-profit entity, provides temporary shelter for the homeless, provides temporary housing and other assistance for victims of spousal abuse, serves meals to the needy in a congregate setting, operates a second-hand clothing store, and operates a food bank to provide food for those temporarily in need. Which of the following is the best statement of operating objectives for Aid for Friends? a) Our objective is to provide food and shelter for the needy. b) Our objective is to provide assistance to those in need. c) Our objective is to provide temporary assistance to those in need. d) Our objective is to help the needy achieve financial independence. 15. Which of the following is NOT an example of a performance budget? a) Program budget. b) Object classification budget. c) Zero-based budget. d) Priority-based budget. 16. Which of the following is true about zero-based budgeting? a) It is a variant of program budgeting. b) It requires activities of the entity to be evaluated over a five-year period. c) It currently is used by most state and local governments. d) It is incremental in approach. ch14 Page 4 17. Help, Inc., a notfor-profit entity dedicated to providing assistance to the needy, has submitted to its governing body a budget that includes the following budgeted expenditures. Nutrition $250,000 Family housing assistance $300,000 Shelter House $200,000 Legal aid $100,000 Medical assistance $150,000 Which of the following best describes the budgeting practices of this entity? a) The entity uses program budgeting techniques. b) The entity uses object classification budgeting techniques. c) The entity uses zero-based budgeting techniques. d) The entity uses priority-based budgeting techniques. 18. Which of the following is true about budgets prepared by entities that use program budgeting techniques? a) The budget package will include information about the object classification expenditures necessary to accomplish a specific goal or objective. b) The budget package will generally include information about the costs of providing a variety of levels of service of the same program. c) The budget package will generally include information about the importance of the activity in accomplishing the entity's objectives, alternatives methods of accomplishing the objective, and the consequences of not performing the activity. d) All of the above can be true. 19. Which of the following is an advantage of program budgeting over traditional budgeting techniques? a) It promotes continuation of existing programs. b) It relates expenditures to objectives. c) It encourages consideration of alternative means of accomplishing the objective. d) Both b) and c). 20. Program budgeting, although highly popular and successful, has many disadvantages or drawbacks. Which of the following is an advantage or benefit of program budgeting? a) It may provide too much information. b) It may be applied perfunctorily after its initial implementation. c) It may not live up to its expectations. d) It may discourage funding at levels other than those that will result in actual increases in results. 21. Which of the following is a reason for governmental and not-for-profit entities to incorporate service efforts and accomplishments (SEA) measures into their management process? a) Measuring and reporting upon helps management determine short-term cash flow requirements. b) SEA measures allow management to make objective assessments about whether the goals of the government are worth achieving. c) SEA reporting fosters sound budgeting and administration. d) SEA fosters budgetary compliance and custodianship of resources. ch14 Page 5 22. Which of the following is not one of the three categories of SEA measures identified by GASB? a) Measures of efforts. b) Measures of financial stewardship. c) Measures of accomplishment. d) Measures that relate efforts to accomplishments. 23. Which of the following is an example of a cost-outcome measure? a) Cost per passenger-mile on public transit. b) Cost per hot meal served. c) Cost per legal case handled. d) Cost per client placed in gainful employment. 24. Which of the following is an example of an efficiency measure? a) Cost per client placed in an appropriate job. b) Cost per ton of garbage collected. c) Cost per gallon of water suitable for drinking. d) Cost per child reading at grade level. 25. With regard to audits of SEA, which of the following might be appropriate for an auditor to do? a) Assess the appropriateness of the organizations basic objectives. b) Verify that the government selected the correct indicators to gauge whether its objectives were achieved. c) Evaluate whether SEA data is fairly presented. d) Evaluate the usefulness of SEA data. Use the following information to answer Questions 26 through 29. The City Swimming Pool is considering several options for maintaining the grounds around the pool area over the next ten years. One option is to buy a tractor with equipment for cleaning the underbrush and cutting the grass. A second option is to contract out with a local Garden and Nursery Center that provides this kind of service. A third option is to hire many local youths to do most of the work by hand. The City already has several small lawnmowers and grass-cutting equipment. Option #1 Cost of tractor and equipment (useful life 10 years) $110,000 Salvage value of tractor in 10 years 10,000 Yearly cost of operator 3,000 Yearly maintenance and upkeep, supplies, etc. 1,500 Option #2 Yearly fees $ 18,000 Option #3 Yearly cost of part-time labor $ 16,000 Yearly cost of supplies, equipment repair, etc. 500 Present value factors @ 6% $1 due in ten years .55839 Annuity of $1 for 10 years 7.36009 ch14 Page 6 26. What is the present value of Option #1? a) $110,000. b) $137,536. c) $148,704. d) $216,721. 27. What is the present value of Option #2? a) $ 10,051. b) $ 18,000. c) $132,482. d) $142,533. 28. What is the present value of Option #3? a) $ 9,213. b) $117,761. c) $118,040. d) $121,441. 29. Which option should the City select based solely on cost? a) Option #1 b) Option #2 c) Option #3 d) Unable to determine. 30. Due to limited resources, Johnson City must select from among the following capital projects. Which project should the City select? a) Court-ordered improvements to the City Jail. b) Repairing the roof on City Hall. c) Replacing an inefficient data processing system with a more efficient system. d) Adding two new cars police to the fleet. 31. Which the of following best describes the role of benefit-cost analysis in the capital budgeting process by governmental and not-for-profit entities? a) It may be used to enhance the objectivity of decision-making. b) Because all costs and all benefits can be quantified, it removes subjectivity from the decision process. c) It eliminates the role of value judgments in the decision-making process. d) It ensures that decisions about capital asset acquisition will be consistent with organizational goals and objectives. ch14 Page 7 PROBLEMS (CHAPTER 14) 1. The City of Greensville is considering automating a process in their accounting department that has been labor-intensive. The equipment currently used in the department can be sold. The new equipment will have a projected useful life of 10 years. The old equipment has a remaining useful life of 10 years. The following data are available to be used in making the decision. Should the City invest in the new equipment? Support your answer with appropriate calculations. Current equipment Current equipment book value Annual depreciation charges Current estimated disposal value New equipment Cost Annual depreciation charge Expected disposal value Labor savings each year Present Value @ 6% $1 due in 10 years Annuity of $1 for 10 years $ 30,000 3,000 4,000 $120,000 10,000 20,000 $ 40,000 .55839 7.36009 2. For each of the following entities or departments, propose at least one measure of outputs and two of outcomes. a) State University Department of Accounting b) City Parks and Recreation Department c) Habitat for Humanity d) American Cancer Society e) University Foundation for support of athletics 3. The City Parks and Recreation Department has determined the following costs related to its very popular 12-week summer youth program. The number of participants in the program has grown significantly over the past few years to 100 participants last year and the Director is preparing for another 10% increase in participants next summer. How much should the Director request for next year? Calculate and defend at least three different budget requests. Direct variable costs for a group of 10 children (group worker and supplies) Number of participants last summer Fixed costs for the summer program Allocated fixed overhead, 25% is directly associated with the program, 75% would not be eliminated if the program were eliminated. Allocated based on number of groups $ 4,500 100 $25,000 $20,000 [Continues on next page.] ch14 Page 8 4. The Kayla Public Library District currently prepares its budget on an object classification basis. Last year s budgeted expenditures included these line items: Salaries Collection purchases Library maintenance Supplies Equipment maintenance Employee benefits Equipment purchases Dues and subscriptions Utilities Bookmobile maintenance The District has decided to use program-based budgeting in the future. Based on your knowledge of libraries, what are three programs that might be included in the District s budget? Establish a program objective for each of those three programs. What are possible measures of inputs, outputs, and outcomes for each program? ch14 Page 9 ESSAYS (CHAPTER 14) 1. One goal of State University is to prepare students to become valuable, contributing members of society. One goal of the Department of Accounting of State University is to prepare students for meaningful careers as professional accountants. What are goals and objectives? How do they differ and how are they similar? What are outputs and outcomes? What are the outputs and the outcomes directly associated with the goals adopted by the University and the Department? How would the University and the Department measure achievement of these goals? 2. GASB has encouraged governmental entities to publish service efforts and accomplishments data. What is the role of auditors in attesting to service efforts and accomplishment data? 3. Many governments use performance budgets in place of, or as a supplement to, the traditional object classification budget. What is a performance budget? What are the advantages and what are the disadvantages of performance budgets over traditional budgets? 4. The Patton Landfill Authority decides to use zero-based budgeting for the first time. Assume that you are asked to prepare the budget decision package for a proposal to establish a 24hour drop off location for large refuse (such as for old appliances, furniture and so forth). Patton County, in which the Authority is located, has recently experienced a surge in the level of illegal dumping. What are four elements that should be included in your budget decision package for the proposed program? ch14 Page 10 ANSWERS TO TRUE/FALSE (CHAPTER 14) 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. T F T T T F F T T F ch14 Page 11 ANSWERS TO MULTIPLE CHOICE (CHAPTER 14) 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. 31. B D B B C B C D A D C C B C B A A D D D C B D B C B C D C A A ch14 Page 12 ANSWERS TO PROBLEMS (CHAPTER 14) Problem 1 Buy new equipment ($120,000) = 1.00000 x $120,000 11,168 = .55839 x $ 20,000 4,000 = 1.00000 x $ 4,000 294,404 = 7.36009 x $ 40,000 $189,572 Purchase price of new equipment Disposal value of new equipment in ten years. Disposal value of old equipment. Cost savings over the ten years. Because the net present value is positive, this is a project that should be undertaken. Problem 2 [Students will have a variety of answers. Remember that outputs measure quantity of service provided while outcomes measure accomplishments.] a) Output: Number of graduates Outcomes: Number of students passing the CPA Exam Number of graduates satisfied in their accounting employment after ten years b) Output: Number of children participating in the summer youth program. Outcomes: Reduction in juvenile crime rates Number of adults satisfied with the youth recreation programs. c) Output: Number of houses built. Outcomes: Reduction in number of families living in substandard housing. Reduction in number of families seeking public assistance for housing. d) Output: Number of brochures mailed. Outcomes: Reduction in the number of deaths related to cancer. Increase in the number of people seeking medical exams for cancer. e) Output: Amount spent in support of athletic programs. Outcomes: Increase in the graduation rate among athletes. Increase in the number of games won. ch14 Page 13 Problem 3 [Students may have a variety of answers but at least one should be a projection based on average cost.] Average Cost Projection $25,000 Fixed costs $45,000 Direct Costs for 10 groups ($4,500 x 10) $20,000 Allocated fixed costs $90,000 / 100 children = $900 average cost per child $900 x 110 children = $99,000 Variable Cost Projection $49,500 ($4,500 x 11 groups) $25,000 Fixed costs $22,000 Allocated fixed costs ($20,000 x 1.10) $96,500 $49,500 ($4,500 x 11 groups) $25,000 Fixed costs $20,500 [$15,000 + ($5,000 x 1.10)] $95,000 Problem 4 [Note: Students will provide a variety of answers to this question.] Possible program categories might include: Bookmobile Teen reading Senior (large-print) reading Children s reading Library district/school district combined programs Community outreach Administrative support. ch14 Page 14 ANSWERS TO ESSAYS (CHAPTER 14) 1. One problem with goals such as these is that accomplishment is difficult to measure. How does one measure "valuable, contributing member of society"? How does one measure "meaningful career as a professional accountant"? Generally, an entity should write its mission statement and then set forth goals and objectives. Goals are generalized statements of aspirations. Operational objectives are specific soughtafter results. Objectives are derived from the organization's mission and its goals, and should be the basis for allocating resources, managing day-to-day activities, and distributing rewards and reprimands. Operational objectives should be doable, measurable, and accomplishable. Outputs indicate the quantity or units of service provided by an activity or entity. Outcomes represent the results of an activity. Outcomes are generally more difficult to measure than outputs. In the absence of measures indicative of true outcomes, organizations often resort to surrogates. The University will probably not be able to measure the desired outcome "valuable, contributing member of society." Outcomes would be very subjective. What makes one a contributing member of society? Is a man or a woman a contributing member of society because he or she becomes a parent, or is his or her contribution measured rather on the contribution made by the children they raise? Are people contributing members of society because they are gainfully employed, because they vote, or because they become leaders in their profession? These are value-driven questions. Perhaps the University will find surrogates, outputs, to measure what appears to be unmeasurable. Output measures might be graduation rates (probably not a good output measure for this goal), employment rates (maybe a slightly better measure). The Department will probably find it somewhat easier to measure outcomes. Surveys of graduates ten years after graduation might well identify the success the students have had in the accounting careers. One would expect that in ten years, graduates who have meaningful careers would be at a supervisory level within their organization. Percentage of graduates in supervisory positions would be an output measure probably. The individual graduate can only define what constitutes a meaningful career. What is meaningful to one graduate may not be meaningful to another. ch14 Page 15 2. The role of auditors in attesting to reports on service efforts and accomplishments (SEA) can be similar to that in expressing an opinion on traditional financial statements. If the SEA data can be measured and reported upon, auditors can verify the measurements. Auditors can be involved not only in verifying the data, but also in evaluating the quality of the internal control system used to collect the SEA data. Auditors are trained in evaluative techniques that transcend the underlying data. We tend to think of auditors as auditors of financial statements, but they can audit almost anything if there are objective standards against which to measure. As SEA data becomes more available, citizens will want the same level of credibility attached to the SEA data as is currently attached to financial statements that have been attested to by a professional. 3. Performance budgets explicitly relate expenditures to operational objectives. Program budgets, the most common type of performance budgets, allocate funds by programs rather than by objects. Programs are composed of activities that are directed toward a common goal. Zero-based budgeting (priority-based budgeting) is a type of program budget. The advantages of program budgeting include the following: a) Relates expenditures to objectives. b) Encourages explicit consideration both of alternative means of achieving the same objective and of whether the objective even needs to be achieved. c) Promotes analysis of the behavior of costs and discourages funding at levels other than those that will result in actual increases in results. d) Invites periodic review of all programs and activities to assure that they are consistent with the entity's current objectives. The main disadvantages of program budgeting include the following: a) May provoke conflict over organizational objectives. b) Encourages governing boards to establish and make known their funding priorities. c) Links dollar expenditures with anticipated outcomes. d) May be prepared conscientiously in the first year and perfunctorily thereafter. e) May be imposed from above and resented by the entity. f) May require adjustments to the computer system to capture the data. g) May present managers with an overwhelming amount of data. h) May not live up to its expectations. i) Decisionmakers may ignore rankings made by program officials. 4. [Note: Students will provide a variety of answers to this question. However, the key elements of any zero-base budget decision package should include:] a) b) c) d) A statement of the activity s objectives; The consequences of not performing the activity; Alternative means of accomplishing the same objective; Expected inputs, outputs and outcomes at various levels of funding. ch14 Page 16

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MD University College - ACCT - 410
15 Chapter Auditing Governments and Not-For-Profit Organizations TRUE/FALSE (CHAPTER 15) 1. A cognizant agency can be either an employee of a federal agency or of an independent accounting firm. 2. The Single Audit Act of 1984 was passed to eliminate the
MD University College - ACCT - 422
ACCT 422 Auditing Theory and Practice Midterm Examination Answers Due Date: On or before Sunday, March 21, 2010 @ 11:59 p.m. EST Instructions: This exam consists of 5 parts. Your answers to the exam questions should be submitted on a separate answer sheet
MD University College - ACCT - 422
ACCT 422 Auditing Theory and Practice Midterm ExaminationDue Date: On or before Sunday, March 21, 2010 @ 11:59 p.m. ESTInstructions: This exam consists of 5 parts. Your answers to the exam questions should be submitted on a separate answer sheet. Your a
MD University College - ACCT - 411
Name: Tommy Y. Choi Accounting 411 Mid-Term Spring 2010 Do not use colors to indicate your answer because colors dont print. Either bold or underline your answer. 1) The relationship between legal and ethical is: a. Legal requires more than ethical b. Eth
MD University College - ACCT - 422
Chapter 1 Practice Problems 1-14 a. 1-15 a. 1-16 a. (3) (2) b. b. (2) (3) c. c. (2) (4) d. d. (3) (3)The relationship among audit services, attestation services and assurance services is reflected in Figure 1-3 on page 13 of the text. Audit services are
MD University College - ACCT - 422
Chapter 2 Practice Problems 2-16 a. 2-17 a. 2-19 a. b. c. d. e. f. g. h. i. j. 2-20 a. (1) (2) b. b. (2) (1) c. c. (3) (2) d. d. (3) (3)Engagement performance Human resources Engagement performance Engagement performance Relevant ethical requirements Mon
MD University College - ACCT - 422
Solutions to Chapter 3 Practice Problems 3-23 a. 3-24 a. 3-25 a. 3-28(a) CONDITION 1. Scope of the audit has been restricted (b) MATERIALITY LEVEL Highly material (c) TYPE OF REPORT Disclaimer(2) (3) (2)b. b. b.(3) (4) (3)c. c. c.(3) (1) (3)COMMENT
MD University College - ACCT - 422
Solutions to Chapter 4 Practice Problems 4-8 The rules concerning stock ownership by partners and professional staff: A partner in the office of the partner responsible for an audit engagement cannot own stock in that audit client. A partner can own stock
MD University College - ACCT - 422
Chapter 7 Practice Problems 7-27 a. 7-28 a. 7-29 a. (2) (3) 1. 2. 3. 4. 5. 6. * * b. b. (1) (3) c. c. 7. 8. 9. 10. 11. 12. (4) (4) d. d. (4) (4) 13. 14. 15. 16. 17. 18. Internal External Internal External External ExternalExternal Internal External Exter
MD University College - ACCT - 422
Chapter 8 Practice Problems 8-25 a. 8-26 a. 8-27 a. 8-28 Audit Activities 1. Send an engagement letter to the client. 2. Tour the clients plant and offices. 3. Compare key ratios for the company to industry competitors. 4. Review managements controls and
MD University College - ACCT - 422
Solutions to Chapter 9 Practice Problems 9-22 a. 9-23 a. 9-24 a. (4) (1) (2) b. b. b. (4) (1) (3) c c. c. (1) (1) (1)9-29 Acceptable audit risk is a measure of how willing the auditor is to accept that the financial statements may be materially misstated
MD University College - ACCT - 422
Solutions to Chapter 10 Practice Problems 10-30 10-31 10-32 10-34 a. a. a. 1. (3) (3) (3) a. b. c. 2. a. b. c. b. b. b. (3) (2) (4) c. c. c. (4) (4) (4) d. d. d. (4) (2) (2)Adequate documents and records and independent checks on performance. Transaction
MD University College - ACCT - 422
Solutions to Chapter 11 Practice Problems 11-20 11-21 11-22 11-23 INFORMATION 1. Management has a strong interest in employing inappropriate means to minimize reported earnings for tax-motivated reasons. Assets and revenues are based on significant estima
MD University College - ACCT - 422
Solutions to Chapter 12 Practice Problems 12-17 12-18 12-20PERSON 1 a. b. c. Systems analyst Programmer Systems analyst Programmer Systems analyst Programmer Data control* PERSON 2 Computer a. a.(1) (1)b. b.(1) (3)c. c.(3) (2)d. d.(3) (3)PERSON
MD University College - ACCT - 422
Solutions to Chapter 13 Practice Problems 13-22 13-23 13-24a. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. TD of B TD of B AP T of C ST of T AP TD of B T of C TD of B T of C T of C b. Recalculation Documentation Analytical procedures Documentation Documentation An
MD University College - ACCT - 422
Solutions to Chapter 14 Practice Problems14-21 14-22 14-23 14-25a. a. a. 1.(4) (4) (4) a. b. c. a. b. c. a. b. c.b. b. b.(4) (3) (4)c. c. c.(3) (1) (2) d. (1)Test of control Existing sales transactions are recorded. (Completeness) Documentation Te
MD University College - ACCT - 422
Solutions to Chapter 16 Practice Problems 16-20 16-21 16-22 16-30 a. a. a. a. (4) (4) (2) b. b. b. (4) (2) (1) c. c. (2) (2)Yes, it is acceptable for the controller to review the list of accounts the auditor intends to confirm. The confirmations will be
MD University College - ACCT - 422
Solution to Chapter 18 Practice Problems 18-18 18-19 18-21a. TYPE OF TEST Both (test of authorization is a test of control) b. PURPOSE OF PROCEDURE To determine that the amount recorded in thea. a.(2) (3)b. b.(2) (3)c. c.(2) (1)QUESTION 1acquisi
MD University College - ACCT - 422
Solutions to Chapter 19 Practice Problems 19-17 19-18 19-19 19-20 19-23a. TYPE OF EVIDENCE USED Analytical procedure Confirmation b. TYPE OF PROCEDURE Analytical procedure Test of details of balances c. & d. OBJECTIVE(S) Not applicable Existence Complete
MD University College - ACCT - 422
Solutions to Chapter 20 Practice Problems 20-17 20-18 20-20TYPE OF TEST1. Substantive test of transactions 2. Test of control 3. Substantive test of transactions 4. Substantive test of transactions 5. Substantive test of transactions 6. Test of control
MD University College - ACCT - 422
Solutions to Chapter 22 Practice Problems 22-20 22-21 22-28a. PURPOSE OF CONTROL 1. To insure that records are properly maintained. 2. To insure that records are properly maintained. 3. To insure that the general ledger reflects the balance of supporting
MD University College - ACCT - 422
Chapter 1: The Demand for Audit and Other Assurance Services Chapter 1 introduces the concept of assurance services which are independent professional services that improve the quality of information for decision makers. Most assurance services can be pro
MD University College - ACCT - 422
Chapter 2: The CPA Profession You should be familiar with the types of CPA firms, the types of activities performed by CPA firms, and the structure and hierarchy of CPA firms, as discussed on pages 26 30 of the text. The American Institute of Certified Pu
MD University College - ACCT - 422
Chapter 3: Audit Reports Chapter 3 covers the types of reports/opinions an auditor can render during the audit of a companys financial statements. As discussed in Chapter 2, the requirement to render a report, and the general contents of the report, are s
MD University College - ACCT - 422
Chapter 4: Professional Ethics This chapter deals with professional ethics, independence, and the other requirements under the AICPA Code of Professional Conduct. The first part of Chapter 4 (pages 78 83) discusses, in general terms, the concept of ethics
MD University College - ACCT - 422
Chapter 5 Legal Liability This chapter deals with the legal environment in which CPAs practice, focusing on liability under both common law and statutory law. Both civil and criminal liability is discussed. A good place to start is to familiarize yourself
MD University College - ACCT - 422
Chapter 6 Audit Responsibilities and Objectives Chapters 6 13 present an overview of the audit process. Chapter 6 covers the 5 steps in developing audit objectives: (1) Understanding objectives of an audit of financial statements and the responsibilities
MD University College - ACCT - 422
Chapter 7 Audit Evidence The 3rd field work standard of GAAS requires the auditor to obtain sufficient and competent evidence through various methods. Some of the methods by which the auditor can obtain evidence are explicitly set forth in the standard (i
MD University College - ACCT - 422
Chapter 8 Audit Planning and Analytical Procedures The 1st field work standard of GAAS imposes on an auditor an obligation of adequately planning the audit. Chapter 8 discusses the steps involved in the audit planning process as well as the usefulness of
MD University College - ACCT - 422
Chapter 9 Materiality and Risk This chapter discusses the concepts of materiality and risk in the audit process. Materiality The importance of the concept of materiality is demonstrated by looking at the scope paragraph of the audit report, which provides
MD University College - ACCT - 422
Chapter 10 Section 404 Audits of Internal Control and Control Risk Chapter 10 deals with internal control and control risk and the auditors assessment of both. Internal control is defined as the policies and procedures designed by company management to pr
MD University College - ACCT - 422
Chapter 11 Fraud Auditing We were introduced to the concept of fraud in Chapter 6 in the context of the auditors responsibility with respect to detecting fraud. This chapter expands upon that introduction by discussing in some detail the responsibilities
MD University College - ACCT - 422
Chapter 12 Impact of Information Technology on the Audit Process This chapter discusses the integration of information technology into the accounting system, the enhancements and new risks associated with such integration, and the internal controls design
MD University College - ACCT - 422
Chapter 13 Overall Audit Plan and Audit Program Chapter 13 addresses the five types of tests that may be used by the auditor in developing his/her overall audit plan. In developing his/her audit plan, the auditor must consider both the benefits/shortfalls
MD University College - ACCT - 422
Chapters 14 and 16 Audit of the Sales and Collection Cycle: Tests of Controls and Substantive Tests of Transactions and Substantive Tests of Details of Balances (Accounts Receivable) Chapters 14 17 cover the application of the audit process to the Sales a
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Chapters 18 - 19 Audit of the Acquisition and Payment Cycle Last week, we covered the Sales and Collection cycle. This week we cover the Acquisition and Payment cycle. Chapters 18 19 cover this cycle in much the same way that the Sales and Collection cycl
MD University College - ACCT - 422
Chapter 20 Audit of the Payroll Cycle and Personnel Cycle The Payroll and Personnel cycle involves the employment of personnel to perform services, the payment of those employees, the withholding of taxes and other deductions, and the payment of withheld
American InterContinental University Dunwoody - MCS - 111
Management Control Systems SystemsWhat is Control ? WhatControlling is the measurement and Controlling correction of performance of activities in order to ensure that the planned objectives are accomplished. are Control, centres on the prevention and Co
Montana Tech - BTH - 1802
Introduction To Biotechnology Genetic Engineering The definition of Genetic engineering refers broadly to the process of directed manipulation of the genome of an organism, usually a specific gene as defined by Helen, K. and Adrianne, M. (2005). The main
University of Toronto - CHEM - 1101
AMATH/BIOL 382 Problem Set 1 Solutions1. One can begin by observing that equation two factors as 0 = 2ass (2 bss ). The case ass = 0 can be ruled out, since this cannot satisfy the rst equation. Thus bss = 2. Substituting into the rst equation gives 0 =
University of Toronto - CHEM - 1101
AMATH/BIOL 382 Problem Set 1 Due January 22, 20101. Notes, chapter 1: Exercise 1.1.11. 2. Consider the chemical reaction network indicated in Figure 1 with rate constants as shown.k1 k3E FA Bk2C DFigure 1: Closed Network a) Write a set of six diere
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AMATH/BIOL 382 Problem Set 2 Solutions1. a) The full reaction mechanism is described by ds(t) dt de(t) dt dc(t) dt dp(t) dt = k1 s(t)e(t) + k1 c(t) = k1 s(t)e(t) + (k1 + k2 )c(t) k2 e(t)p(t) = k1 s(t)e(t) (k1 + k2 )c(t) + k2 e(t)p(t) = k2 c(t) k2 e(t)p(t
University of Toronto - CHEM - 1101
AMATH/BIOL 382 Problem Set 2 Due February 3, 20101. Recall the derivation of the Michaelis-Menten description of an enzyme catalysed reaction (refer to Figure 1). If the back reaction C P + E is not assumed negligibly slow, theS+Ek1 k 1Ck2 k 2E+P.
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AMATH/BIOL 382 Problem Set 3 Solutions1. (i) Running the le # Assignment 3 Problem 2i s1=Vmax1-Vmax2*S1/(Km2+s1) s2=Vmax2*S1/(Km2+s1)-Vmax3*s2/(Km3+s2) # parameters par Vmax1=1,Vmax2=2,Vmax3=4,Km2=4,Km3=3 done yields steady state (s1 , s2 ) = (4, 1). (ii
University of Toronto - CHEM - 1101
AMATH/BIOL 382 Assignment 3 Due February 12, 20101. Consider the metabolic chain indicated below. Take the reaction kinetics asv1S1v2S2v3v1 = Vmax1 Vmax2 s1 v2 = Km2 + s1 Vmax3 s2 v3 = Km3 + s2 You will investigate the sensitivity of the steady sta
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AMATH/BIOL 382 Computational Modelling of Cellular SystemsBrian Ingalls Applied Mathematics University of Waterloo bingalls@uwaterloo.ca December 28, 2009Contents1 Biochemical Reaction Networks 1.1 Chemical Reaction Networks . . . . . . . . . . . . . .
University of Toronto - CHEM - 1101
1/6 CHEM350: Lecture 1-3, Jan 4, 6, and 8 2010 Review of gas behaviour (covered in previous courses) Reading in textbook: Chapters 1 (brief review) and 7 (properties of real gases) Ideal gas equation of state (relates the state variables of a gas):PV = n
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1/1 CHEM350: Lecture 4, Jan 11 2010 Gibbs free energy for nonideal gases (section 7.5 in textbook) We know from thermodynamics that the total differential for the molar Gibbs free energy G (T , P ) has the formdG = SdT + VdPfrom which we obtain the rela
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1/1 CHEM350: Lecture 5, Jan 13 2010 Gibbs free energy for nonideal gases (section 7.5 in textbook) (continued) Notice that G o (T ) in the previous expression is the ideal gas pressure at 1 bar. This means that the standard state of the nonideal gas is 1
University of Toronto - CHEM - 1101
CHEM 350 Lecture 6, January 15, 2010 Relation between B2 (T ) and intermolecular interactions. We shall consider only the simplest case: that of a gas of lledshell [or 1 S state] atoms, such as He, Ne, Ar. If V (R) is the potential energy (energy of inter
University of Toronto - CHEM - 1101
CHEM 350 Lecture 7, 8, and 9, January 18, 20, and 22, 2010 Introduction to Statistical Mechanics. There are two general approaches to the description of physical systems: i) Macroscopic: large units of matter; units mol, mmol, etc. mechanical variables: V
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CHEM 350 Lecture 10, January 25, 2010 Fluctuations (continued)The number of atoms on a given side varies from frame to frame though not by much these are local uctuations which occur even though our system is in equilibrium For a small number of particle
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CHEM 350 Lectures 11 and 12, January 27 and 29, 2010 Ensemble Averages. variable v : having M possible values v1 , v2 , , vM : corresponding probabilities p1 , p2 , , pM N systems in ensemble with variable v having value vr in Nr = N pr of them with so m
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CHEM 350 Lectures 13, 14, and 15 February 1, 3, and 5 2010 Statistical Description of a System of Particles. Microscopic arrangements of particles: called conguration, complexion, state (QM) for an isolated system, each quantum state is associated with an
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CHEM 350 Lectures 16, 17, and 18 February 7, 10, and 12 20101MOLECULAR PARTITION FUNCTIONS. Independent Subsystems. 2In all cases we shall be concerned with subsystems that are statistically independent, and in the following, we shall ignore any intera
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CHEM 350 Lecture 19, February 22 2010 Rotations. First let us review briey the quantum mechanical description of simple rotational motion for a rigid rotor: 22 J (, ) = Erot (, ) , 2 2Re2 Upon setting Re = I (the moment of inertia of the rotor), we obtai
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CHEM 350 Lectures 25-35, March 8, 10, 12, 15, 17, 19, 22, 24, 26, 29, 31 2010 Grahams law example: A: known molar mass B: unknown molar mass At xed T , and P , for a given hole size: mB rate of escape of A MB = = rate of escape of B mA MATime dependence
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Connection between molar volume and pressure expressions for the van der Waals equation of state The van der Waals equation is P= RT 1 a RT b a 2 1 + + 2 V 1 b/V V V V V RT a1 1 + (b ) + RT V Vwhere we have expanded in a power series and nd that a = (b )
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Chemistry 350 Assignment 3: Solutions November 1st 2005 Question 115.4Consider the following table of diatomic molecules and associated rotational constants: Molecule H35Cl 12 16 CO 39 KI CsI B (cm1) 10.59 1.93 0.061 0.024 !" (cm1) 2886 2170 200 120a)
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Chemistry 350 Assignment 4: Solutions November 21st 2005 Question 1Q18.1Why is the stoichiometry of a reaction generally not sufficient to determine reaction order? The order of a rate equation for a chemical reaction indicates the concentration depende
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Chemistry 350 Assignment 5: Solutions December 5th 2005 Question 1Q19.2For a reaction mechanism to be considered correct, what property must it demonstrate? In order to be valid, a proposed reaction mechanism must agree with the experimentally determine