Determine whether each cash payment procedure is an internal control strength or weakness. 1. A voucher system is used for all payments of liabilities. 2. The owner of a small business has authority to write and sign checks. 3. When the owner is out of town, the recordkeeper is in charge of signing checks. 4. To save time, all departments are allowed to incur liabilities. 5. Payments over $100 are made by check. 6. Requesting and receiving merchandise are handled by the same department.
Determine whether each cash payment procedure is an internal control strength or weakness. 1. A voucher system is used for all payments of liabilities. 2. The owner of a small business has authority to write and sign checks. 3. When the owner is out of town, the recordkeeper is in charge of signing checks. 4. To save time, all departments are allowed to incur liabilities. 5. Payments over $100 are made by check. 6. Requesting and receiving merchandise are handled by the same department.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Determine whether each cash payment procedure is an internal control strength or weakness.
1. A voucher system is used for all payments of liabilities.
2. The owner of a small business has authority to write and sign checks.
3. When the owner is out of town, the recordkeeper is in charge of signing checks.
4. To save time, all departments are allowed to incur liabilities.
5. Payments over $100 are made by check.
6. Requesting and receiving merchandise are handled by the same department.
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