Financial And Managerial Accounting
15th Edition
ISBN: 9781337902663
Author: WARREN, Carl S.
Publisher: Cengage Learning,
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Chapter 7, Problem 5TIF
To determine
Suggest appropriate control procedures to prevent theft of cash.
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The following is an excerpt from a conversation between two sales clerks, Jean Moen and Sara Cheney. Jean and Sara are
employed by Turpin Meadows Electronics, a locally owned and operated electronics retail store
Jean: Did you hear the news?
Sara: What news?
Jean: Neal and Linda were both arrested this morning.
Sara: What? Arrested? You're putting me on!
Jean: No, really! The police arrested them first thing this morning. Put them in handcuffs, read them their rights-the
whole works. It was unreal!
Sara: What did they do?
Jean: Well, apparently they were filling out merchandise refund forms for fictitious customers and then taking the cash.
Sara: I guess I never thought of that. How did they catch them?
Jean: The store manager noticed that returns were twice that of last year and seemed to be increasing. When he
confronted Neal, he became flustered and admitted to taking the cash, apparently more than $9,000 in just three
months. They're going over the last six months' transactions to…
The following is an excerpt from a conversation between two sales clerk, Tracy Rawlin and Jeff Weimer. Both Tracy and Jeff employed by Magum electronics, a locally owned operated electronics retail store .
Tracy: did you hear the news?
Jeff: what news?
Tracy: Bridget and Ken were both arrested his morning.
Jeff: what arrested? You are putting me on!
Tracy:No, really ! The police arrested then first thing this morning. Put them in handcuffs , read them their right the whole works. It was unreal!
Jeff: what did they do?
Tracy : well apparently they were filling out merchandise refund form from fictitious customers and then taking the cash .
Jeff: I guess I never thought of that .How did they catch them?
Tracy: The store manager noticed that returns were twice that of last year and seemed to be increasing. When he confronted Bridget , she became flustered and admitted to taking the cash , apparently over $ 15000 in just three months. They are going over the last six months…
Madam Lorraine’s daughter Maame Efua has just completed Senior High School and due to the Covid 19 pandemic that led to the closure of universities, she has been helping with record keeping at her mother’s convenient mini Mart. Maame Efua took responsibility of recording her mother’s purchases of goods from suppliers (both on credit and cash basis) and also issues receipts to customers when they buy goods. The policy of the shop is cash sales only.
Prior to Maame Efua assisting her mom, Mr. Fred, an accountant used to visit the shop two days after the end of the month to check Madam Lorraine’s purchase invoices, bank deposits, cash at hand, etc in order to prepare the financial records for the month for a small fee. He also assists with records to be sent to the tax authorities and make the necessary payments.
Having now been conversant with the amount of sales per day and the month, and also recording all the purchases, Efua believes she is able to determine how much profit her mother…
Chapter 7 Solutions
Financial And Managerial Accounting
Ch. 7 - Prob. 1DQCh. 7 - Why should the employee who handles cash receipts...Ch. 7 - Prob. 3DQCh. 7 - Why should the responsibility for maintaining the...Ch. 7 - Prob. 5DQCh. 7 - Prob. 6DQCh. 7 - Prob. 7DQCh. 7 - Prob. 8DQCh. 7 - Prob. 9DQCh. 7 - Prob. 10DQ
Ch. 7 - Prob. 1BECh. 7 - Prob. 2BECh. 7 - Prob. 3BECh. 7 - Prob. 4BECh. 7 - Prob. 5BECh. 7 - Sarbanes-Oxley internal control report Using...Ch. 7 - Prob. 2ECh. 7 - Prob. 3ECh. 7 - Prob. 4ECh. 7 - Prob. 5ECh. 7 - Prob. 6ECh. 7 - Prob. 7ECh. 7 - Prob. 8ECh. 7 - Prob. 9ECh. 7 - Prob. 10ECh. 7 - Prob. 11ECh. 7 - Entry for cash sales; cash short The actual cash...Ch. 7 - Entry for cash sales; cash over The actual cash...Ch. 7 - Prob. 14ECh. 7 - Prob. 15ECh. 7 - Prob. 16ECh. 7 - Prob. 17ECh. 7 - Prob. 18ECh. 7 - Prob. 19ECh. 7 - Prob. 20ECh. 7 - Prob. 21ECh. 7 - Prob. 22ECh. 7 - Prob. 23ECh. 7 - Prob. 24ECh. 7 - Prob. 1PACh. 7 - Prob. 2PACh. 7 - Prob. 3PACh. 7 - Prob. 4PACh. 7 - Prob. 5PACh. 7 - Prob. 1PBCh. 7 - Prob. 2PBCh. 7 - Prob. 3PBCh. 7 - Prob. 4PBCh. 7 - Prob. 5PBCh. 7 - Analyze and compare Amazon.com to Netflix...Ch. 7 - Analyze and compare J. C. Penney and Macys J. C....Ch. 7 - Prob. 3MADCh. 7 - Prob. 4MADCh. 7 - Analyze and compare Nike, lululemon, and Under...Ch. 7 - Ethics in Action Tehra Dactyl is an accountant for...Ch. 7 - Bank error During the preparation of the bank...Ch. 7 - Prob. 4TIFCh. 7 - Prob. 5TIF
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