To Test the Transaction Assertion of Occurrence in the Area

question 86

Multiple Choice

To test the transaction assertion of occurrence in the area of payroll, the auditor most likely would

• A)select a sample of personnel files and trace the pay rate to union contracts or other rate rights and obligations.
• B)select a sample of personnel files and trace the pay rate to payroll department files used in payroll preparation.
• C)select a sample of payroll register entries and recalculate gross pay, deductions, and net pay.
• D)select a sample of payroll register entries and vouch hours worked to clock time cards.

Distinguish between the accounting and legal entity concepts of corporations.

Understand the role of retained earnings in financial reporting and the process of closing entries.

Identify the differences in chartering of businesses under state and federal laws.

Understand the implications of double taxation on corporations.

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Definitions:

Post-Separation

The period or condition following the end of a relationship or partnership.

Language Code

A set of rules or symbols used for communication through writing, speaking, or other means.

Nonverbal Cues

Body language and other physical behaviors that communicate feelings and intentions without words.

Physical Contact

Bodily touch or interaction between people, which can communicate various messages or serve different social functions.