Unit 9 accounting

Identify which department has stewardship (having the job of supervising or taking care of) over the following journals, ledgers, and files. (Please be reminded of the Honor Pledge written in your answer sheet.) 1. Customer open order file   2. Sales journal  3. Journal voucher file   4. Cash receipts journal  5. Inventory subsidiary ledger  6. Accounts receivable subsidiary ledger  7. Sales history file  8. Shipping report file  9.  Credit memo file10. Sales order file11.  Closed sales order file       PreviousNext

Paul Williams recently joined XYZ2 Limited as the head of accounting department. Williams spent the first few weeks to analyse the account information system. Based on this analysis, Williams is concerned about the purchase system of XYZ2 Limited. Here is the details of purchase system. The purchasing agent of XYZ2 Limited periodically checks inventory levels from a computer terminal, which is connected to a central accounting system. The agent searches the inventory file for items that need to be ordered. He then selects a supplier, prints a hard copy of the purchase order, and mails it to the vendor. The clerk files one copy of the PO in the department and sends a second copy to the AP Clerk. When the inventories arrive at the receiving department, a receiving clerk reconciles the items with the packing slip, inspects them for condition, and manually prepares a three-part receiving report. The clerk sends one copy to the purchasing department to close out the open PO, files one copy…

Paul Williams recently joined XYZ2 Limited as the head of the accounting department. Williams spent the first few weeks analysing the account information system. Based on this analysis, Williams is concerned about the purchase system of XYZ2 Limited. Here are the details of the purchase system.   The purchasing agent of XYZ2 Limited periodically checks inventory levels from a computer terminal connected to a central accounting system. The agent searches the inventory file for items that need to be ordered. He then selects a supplier, prints a hard copy of the purchase order, and mails it to the vendor. The clerk files one copy of the PO in the department and sends a second copy to the AP Clerk. When the inventories arrive at the receiving department, a receiving clerk reconciles the items with the packing slip, inspects them for condition, and manually prepares a three-part receiving report. The clerk sends one copy to the purchasing department to close out the open PO, files one copy…

Question #66:  Lamar LLC is in the process of updating its revenues and receivables systems with the implementation of new accounting software. James Loden, Inc. is an independent information technology consultant who is assisting Tamar with the project. James has developed the following checklist containing internal control points that the company should consider in this new implementation: Is the sales department separate from the credit office and the IT department? Are all collections from customers received in the form of checks? Is it appropriate to program the system for general authorization of certain sales, within given limits? Are product quantities monitored regularly? Required: In a two (2) page response, describe the control purpose for each point presented in the case.

You were hired to assist Oman based Company in designing an accounting system for Oman Co., Ltd. has developed a list of the journals, ledgers, reports and documents that he thinks Oman Co., Ltd. The company asks you to complete the following tasks: a) Specify what data you think should be collected on each of the following four documents: Sales invoice, purchase order, receiving report, employee time card. b) Design a report to manage inventory. e) Design a report to assist in managing credit sales and cash collections. d) What types of journals, ledgers and blank forms for various documents ( Sales invoices, purchase orders etc)

Consider the following short case as you respond to the question:SPC Corporation sells computer security software. They maintain their AIS using general ledger software; data files are backed up twice a day. Sales staff can access the customer database, inventory files and general ledger, as well as sales-related documents such as invoices and sales orders. Newly hired sales staff members at SPC receive the company procedures manual which explains the process used to complete the steps in the sales/collection process. To minimize costs, SPC designates up to five sales staff members each month who can do credit checks for all new customers in addition to processing sales. SPC bills its clients monthly and uses the balance forward method of accounting for receivables; all cash receipts from clients are processed using a lockbox procedure. The lockbox firm's fee is 3% of all collections. SPC's accounting department estimates bad debts at the end of each fiscal year; they are normally…

Performance Task #2. Case Study Instructions: Analyze the given situations and prepare what is asked for you to compute. Answers must be in a paragraph form. Place your output in your notebook. God bless! You are auditing the financial statements of Sakura Store, a retailer of sporting goods, appliances, and electronics. During the prior years' audits of Sakura Store, you noticed that management was less concerned about the timely recording of liabilities and expenses than assets and revenues. As a result, very little of Sakura Store's internal control resources were expended in assuring an accurate and timely recording of accounts payable. You also believed that Sakura Store's management may be motivated to delay recording its liabilities at year end, so you are currently approaching the search for unrecorded liabilities with caution. Questions: a. Wha are the substantive auditing procedures would you perform in searching for Sakura's unrecorded liabilities? 109 6. How would the…

You    are    a    member    of    a    project    team    for    the implementation of a new bank reconciliation accounting software for your company. Due to the size of your company, the daily transaction volumes are over 5,000.    The   project    team    has    narrowed    down    five    suppliers    for    the    software.    From    these you are required to make your input as to which would be the most suitable for your company.  we selected a software, BANKDOC1. At implementation, the information was correctly loaded to the system and the daily reconciliations were performed accurately. During week 2, your Bank communicated that there would be a change in their system as they    were    now    utilizing    a    new    platform.    As    such,    some    of    the    required    fields    for    BANKDOC1 would now be eliminated on the Bank side. Required: - Define the problem. - What are the core issues? - What actions would you take to solve the problem?

Lamar LLC is in the process of updating its revenues and receivables systems with the implementation of new accounting software. James Loden, Inc. is an independent information technology consultant who is assisting Tamar with the project. James has developed the following checklist containing internal control points that the company should consider in this new implementation: Is the sales department separate from the credit office and the IT department?

CASE:Outsourcing Accounting FunctionsYou have been employed for two years in the accounting department of a mid-sized multinational consumer products company. Your performance has been outstanding, and it is clear that management feels you have great potential with the firm. However, you are quite surprised when your manager calls you into her office to tell you that you have been chosen to lead an effort to identify an outsourcing partner for the payroll, accounts payable, and accounts receivable functions. She assures you that there will be an excellent assignment for you after the outsourcing is successfullycompleted and all is functioning well in one to two years. Questions: 1.What benefits might your organization gain from outsourcing basic accounting functions? 2. .Identify at least three major organizational challenges associated with transitioning these functions to an outsourcing firm.

Iris Plant owns and operates three floral shops in Magnolia, Texas. The accounting functions are performed manually. Each of the shops has a manager who oversees the cash receipts and purchasing functions for the shop. A clerk at the central shop pays all the bills and also prepares payroll checks and maintains the general journal. Iris is seriously considering switching to a computerized system. With so many information system packages on the market, Iris is overwhelmed. Advise Iris as to which business modules you think her organization could find beneficial. Discuss advantages, disadvantages, and internal control issues.

The following is an excerpt from a conversation between the store manager of Wholesome Grocery Stores, Kara Dahl, and Lynn Shutes, president of Wholesome Grocery Stores:Lynn: Kara, I’m concerned about this new scanning system.Kara: What’s the problem?Lynn: Well, how do we know the clerks are ringing up all the merchandise?Kara: That’s one of the strong points about the system. The scanner automatically rings up each item based on its bar code. We update the prices daily, so we’re sure the sale is rung up for the right price.Lynn: That’s not my concern. What keeps a clerk from pretending to scan items and then simply not charging his friends? If his friends were buying 10–15 items, it would be easy for the clerk to pass several items through putting his finger over the bar code or just pass the merchandise through the scanner with the wrong side showing. It would look normal for anyone observing. In the old days, we at least could hear the cash register ringing up each sale.Kara: I see…

A company is trying to set up proper internal controls for their accounts payable/inventory purchasing system. Currently the purchase order is generated by the same person who receives the inventory. Together the purchase order and the receiving ticket are sent to accounts payable for payment. What changes would you make to improve the internal control structure? Group of answer choices 1.The person in accounts payable should generate the purchase order. 2.The person in accounts payable should generate the receiving ticket once the invoice from the supplier is received. 3.No changes would be made since the person paying the bills is different from the person ordering the inventory. 4.The responsibilities of generating the purchase order and receiving the inventory should be separated among two different people.

Tuscaloosa National Bank has two service departments, the Human Resources (HR) Department and the Computing Department. The bank has two other departments that directly service customers, the Deposit Department and the Loan Department. The usage of the two service departments’ output for the year is as follows:                                                                             Provider of Service                                                                                       HR                   Computing User of Service HR ................................................................................    —                        15% Computing ...................................................................10%                        — Deposit ...........................................................................60%                     50% Loan .................................................................................30%                     35% The…

You are internal auditor inspecting process used by sales representatives of a company selling office supplies to small companies. Before a new customer’s line of credit established, the sales rep must complete an online form that contains questions for which they must gather information from the new customer.  The company asks that the sales reps gather this data (there is much more required, these are just the first few fields) as the first part of the data gathered:  Company name, address, corporate form (sole proprietor, LLC, LLP, or S Corp), line of credit amount requested, authorized purchaser name and address, shipping address.  For each of these fields, What error conditions need to be addressed? (What is an error condition?) For each, what do you recommend as a test/verification method? (You may find some that you believe don’t need a verification process)

Accounting professionals apply many technology tools to aid them in their everyday tasks and decision making. The General Ledger tool in Connect automates several of the procedural steps in the accounting cycle so the accounting professional can focus on the impacts of each transaction on the full set of financial statements. use this tool in helping students see the advantages of technology and, in particular, the power of the General Ledger tool in accounting practice, including financial analysis and “what-if” scenarios. How much are total expenses for Apple for the current year?

Accounting professionals apply many technology tools to aid them in their everyday tasks and decision making. The General Ledger tool in Connect automates several of the procedural steps in the accounting cycle so the accounting professional can focus on the impacts of each transaction on the full set of financial statements. use this tool in helping students see the advantages of technology and, in particular, the power of the General Ledger tool in accounting practice, including financial analysis and “what-if” scenarios. What is the total amount of assets invested in Apple in the current year?

Downtown! is a rapidly growing web-based retailer with about 100 management and technical support employees at its headquarters office in Florida. Mary Estrada, the firm’s IT manager, is planning a new information system that will give users better access to sales and marketing data and trends. She has a concern, however. She knows that users often request reports but use only a small portion of the data. In many offices she sees inboxes filled with printed reports gathering dust. Mary asked for your opinion: What if new system users could design most of their own reports without assistance from the IT staff, by using a powerful, user-friendly report writer program? Do you think they would request as many reports or the same types of reports? What are the pros and cons of giving users total control over output?

Following are five separate cases involving internal control issues. Required: 1. For each case, identify the principle(s) of internal control that is violated. a. Chi Han receives all incoming customer cash receipts for her employer and posts the customer payments to their respective accounts. b. Sutton Company has two employees handling acquisitions of inventory. One employee places purchase orders and pays vendors. The second employee receives the merchandise. c. Ben Shales prides himself on hiring quality workers who require little supervision. As office manager, Ben gives his employees full discretion over their tasks and for years has seen no reason to perform independent reviews of their work. d. At Tico Company, Julia and Trevor alternate lunch hours. Julia is the petty cash custodian, but if someone needs petty cash when she is at lunch, Trevor fills in as custodian. e. Nori Nozumi posts all patient charges and payments at the Hopeville Medical Clinic. Each night Nori backs up…

Your Audit team is preparing to audit a new client in the electronic retail industry. The client imports items from manufacturers in several Asian countries and retails in a chain of shops located throughout the country.  You and your team members have access to the client's following information. ·         Prior period financial reports ·         Anticipated results for the current year ·         Industry Averages Required: Explain how you would use the information to understand your new client.

Please prepare excel flowchart. Kreton Corporation, your new audit client, processes its sales and cash receipts in the following manner: Page 327 (1) Sales. Salesclerks prepare sales invoices in triplicate. The original and second copy are presented to the cashier, and the third copy is retained by the sales clerk in the sales book. When the sale is for cash, the customer pays the sales clerk, who presents the money to the cashier with the invoice copies. A credit sale is approved by the cashier from an approved credit list. After receiving the cash or approving the invoice, the cashier validates the original copy of the sales invoice and gives it to the customer. At the end of each day, the cashier recaps the sales and cash received, files the recap by date, and forwards the cash and the second copy of all sales invoices to the accounts receivable clerk. The accounts receivable clerk balances the cash received with cash sales invoices and prepares a daily sales summary. Cash sales…

Understanding Sarbanes-Oxley and identifying internal control strengths and weaknesses The following situations suggest a strength or a weakness in internal control. Top managers delegate all internal control procedures to the accounting department. Accounting department staff (or the bookkeeper) orders merchandise and approves invoices for payment. Cash received over the counter is controlled by the sales clerk, who rings up the sale and places the cash in the register. The sales clerk matches the total recorded by the register to each day’s cash sales. The employee who signs checks need not examine the payment packet because he is confident the amounts are correct. Requirements Define internal control The system of internal control must be tested by external auditors. What law or rule requires this testing? . Identify each item in the list above as either a strength or a weakness in internal control, and give your reason for each answer.

ABC Limited operates its business as one of the leading clothing wholesalers in the region and sells its clothes to retailers. You recently joined this wholesaler for a short project where your primary responsibility is to analyse their transaction process system critically. For this purpose, you are provided with the description of various business activities of the following four departments (also see Figure 1.1 on the next page): (1) Sales Department, (2) Accounting Department, (3) Warehouse/Shipping, and (4) Mailroom.    The sales department of ABC Limited has a part-time sales clerk, Miss Emma, who works on the commissions. Miss Emma encourages its customers to forward the orders in any form, including mail, e-mail or fax (recall our discussion on the revenue cycle during the interactive tutorial for week 4). Miss Emma approves the credit sales and calculates commission and discounts. Then, she records the sales in the sales journal from the PC in the sales department. After…