The Multiple Choice Questions Blog

Alex Manufacturing Ltd has several staff on maternity leave claiming statutory maternity pay.

Which ONE of the following controls would NOT ensure that the correct payments are made to employees?

Select ONE answer:

1. The payroll should be checked back to individual employee personnel records
2. Payroll totals should be compared to adjusted budgets each month
3. BACS transfer lists should be authorised by the head of personnel
4. Total tax deductions should be reconciled with the tax returns

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – This is the right answer as it does not relate directly to the employees’ payments but to their tax deductions.

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Alex Manufacturing Ltd. uses many temporary employees.

Which ONE of the following controls would BEST ensure that employees are only paid for work they have performed?

Select ONE answer:

1. Temporary staff records should be maintained for each member of temporary staff
2. Temporary staff pay should be authorised by the human resources manager
3. Temporary staff should complete work schedules, authorised by their supervisor
4. Temporary staff should be paid by direct transfers to their bank accounts

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct – It is the temporary staff’s work schedules that document the hours worked. As such they require control to ensure that it is only the hours authorised that are subsequently paid.
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

A deficiency has been identified in the following area of the company’s purchase system.

For the deficiency below, select the risk which is MOST LIKELY to arise.

-The payment listing produced by the accounting system is ONLY READ by the payments clerk.

Select ONE answer:

1. Goods and services might not be obtained on the most advantageous terms
2. Invoices are paid at the wrong time
3. Invoices may not be recorded, resulting in non-payment
4. The company may not take advantage of the full period of credit extended

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Not correct
2. Correct – The risk of invoices not being recorded would arise at the goods received/invoicing stage, before the production of a payment listing.
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

A deficiency has been identified in the following area of the company’s purchase system.

For the deficiency below, select the risk which is MOST LIKELY to arise.

-Records of goods received are NOT kept.

Select ONE answer:

1. Goods may be misappropriated for private use
2. Goods and services might not be obtained on the most advantageous terms
3. Invoices may not be recorded resulting in non-payment
4. The company may not take advantage of the full period of credit extended

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – The risk of goods and services not being obtained on the most advantageous terms would be more likely to arise at the ordering stage.
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

A deficiency has been identified in the following area of the company’s purchase system.

For the deficiency below, select the risk which is MOST LIKELY to arise.

• A complete lack of segregation of duties in relation to the ordering process

Select ONE answer:

1. Goods and services might not be obtained on the most advantageous terms
2. Invoices may not be recorded, resulting in non-payment
3. The company may not take advantage of the whole period of credit extended
4. Unauthorised purchases may be made for personal use

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – The risk of not taking full advantage of a period of credit would be a consequence of problems with goods received or payments.

This work is licensed under a Creative Commons Attribution 4.0 International License.