uestion 1 The smallest branch of Bare Beauty Cosmetics in Kingston employs Mary Cooper as a branch manager and Janet Hendricks as a sales assistant. The branch uses a bank account in Kingston to pay expenses. This account is kept in the name of ‘Bare Beauty Cosmetics.’ To pay expenses, cheques must be signed by Mary Cooper or by the treasurer of Bare Beauty Cosmetics, John Wilkins. Cooper receives the cancelled cheques and bank statements. She reconciles the branch account herself and files cancelled cheques and bank statements in her records. Whenever she gets the time, reports of cash disbursements are prepared and sent to the head office in Montego Bay. A. Outline FOUR (4) deficiencies in the internal controls at Bare Beauty Cosmetics. B. For each deficiency, state the type of misstatement that is likely to result, and how the deficiency can be overcome. C. Explain the FIVE (5) types of control activities, and for EACH control
uestion 1 The smallest branch of Bare Beauty Cosmetics in Kingston employs Mary Cooper as a branch manager and Janet Hendricks as a sales assistant. The branch uses a bank account in Kingston to pay expenses. This account is kept in the name of ‘Bare Beauty Cosmetics.’ To pay expenses, cheques must be signed by Mary Cooper or by the treasurer of Bare Beauty Cosmetics, John Wilkins. Cooper receives the cancelled cheques and bank statements. She reconciles the branch account herself and files cancelled cheques and bank statements in her records. Whenever she gets the time, reports of cash disbursements are prepared and sent to the head office in Montego Bay. A. Outline FOUR (4) deficiencies in the internal controls at Bare Beauty Cosmetics. B. For each deficiency, state the type of misstatement that is likely to result, and how the deficiency can be overcome. C. Explain the FIVE (5) types of control activities, and for EACH control
Century 21 Accounting Multicolumn Journal
11th Edition
ISBN:9781337679503
Author:Gilbertson
Publisher:Gilbertson
Chapter5: Cash Control Systems
Section5.2: Bank Reconciliation
Problem 1OYO
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Question 1
The smallest branch of Bare Beauty Cosmetics in Kingston employs Mary Cooper as a branch
manager and Janet Hendricks as a sales assistant. The branch uses a bank account in Kingston to
pay expenses. This account is kept in the name of ‘Bare Beauty Cosmetics.’ To pay expenses,
cheques must be signed by Mary Cooper or by the treasurer of Bare Beauty Cosmetics, John
Wilkins. Cooper receives the cancelled cheques and bank statements. She reconciles the branch
account herself and files cancelled cheques and bank statements in her records. Whenever she
gets the time, reports of cash disbursements are prepared and sent to the head office in Montego
Bay.
A. Outline FOUR (4) deficiencies in the internal controls at Bare Beauty Cosmetics.
B. For each deficiency, state the type of misstatement that is likely to result, and how the
deficiency can be overcome.
C. Explain the FIVE (5) types of control activities, and for EACH control activity, provide
ONE (1) specific illustration of a control for cash and bank transactions that Bare Beauty
Cosmetics could employ.
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