Here are some just a few questions from an auditing course that I just finshed up that I do not have correct answers for. My answers are in bold, can anyone help out to see if I am correct, if not which one is and why. Thanks!


For most entities, stock and dividend transactions are approved by
A. the purchasing department
B. the accounts receivable department
C. the internal auditor
D. the board of directors

Which of the following is a property, plant, and equipment transaction?
A. Paying an insurance premium on a warehouse one year in advance
B. Renting a storage building
C. Leasing of capital assets
D. None of the above

Which of the following are not considered to be a long term asset?
A. Prepaid insurance
B. Goodwill
C. Patent
D. Franchises

Prior to the physical count of inventory, the auditor should
A. Ensure that no production is scheduled
B. Ensure that there is no movement of goods during the inventory count
C. be familiar with the inventory locations and major items in inventory
D. Obtain cutoff information

To determine if the payroll expense is over or understated, the auditor may
A. test the reasonableness of accrual balances
B. compare payroll costs as a percentage of sales with prior years’ and industry
data
C. personally hand out the paychecks to employees on payday
D. compare current year balances in payroll related accrual accounts with prior
years’ balances after adjusting for changes in conditions

Control procedures that prevent payments to fictitious employees meet which of the
following objectives?
A. Validity
B. Timeliness
C. Completeness
D. All of the above

In the purchasing process, which of the following can represent a serious risk to the internal control system?
A. rapid growth
B. a new information system
C. new technology
D. all of the above

Invoice processing is generally done by the
A. Purchasing department
B. Controller
C. Treasurer
D. Accounts payable department

Audit objectives for substantive tests of accounts receivable include:
A. Determining if all accounts receivable are included
B. Determining if all accounts receivable are properly classified in the financial
statements
C. Both A & C
D. None of the above

The following transaction is not typically processed by the revenue process:
A. The sale of good or rendering of a service for cash
B. The request for goods or services from an authorized individual
C. The sale of goods or rendering of a service for credit
D. The return of goods by the customer for credit or cash