Practice Problems Ch. 20 (ACCT-422)

Practice Problems Ch. 20 (ACCT-422) - amount is recorded...

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Solutions to Chapter 20 Practice Problems 20-17 a. (2) b. (1) c. (3) 20-18 a. (4) b. (4) c. (4) 20-20 TYPE OF TEST TRANSACTION-RELATED AUDIT OBJECTIVE(S) 1. Substantive test of transactions To determine if monthly payroll costs have been correctly allocated (accuracy). 2. Test of control To determine if recorded payroll transactions are for work actually performed by existing employees (occurrence). 3. Substantive test of transactions To determine if employees are paid for the hours they have worked (accuracy). 4. Substantive test of transactions To determine if the appropriate person is paid and amount and time are correct (accuracy and timing). 5. Substantive test of transactions To determine if the correct job is charged for labor and if the
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Unformatted text preview: amount is recorded correctly for each job (classification and accuracy). 6. Test of control To determine if all payroll checks are recorded (completeness). 7. Substantive test of transactions To determine whether terminated employees were subsequently paid for work not performed (occurrence). To determine whether an obligation may exist for unpaid severance pay (completeness). 20-23 A flowchart of steps for each type of test is given below (requirements a, b, and c): TESTS OF CONTROLS OR SUBSTANTIVE TESTS OF TRANSACTIONS TESTS OF DETAILS OF BALANCES 6 5 3 8 2 9 7 4 1...
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This note was uploaded on 04/11/2010 for the course ACCT 422 taught by Professor Blake during the Spring '10 term at MD University College.

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