Homework Help is Here – Start Your Trial Now!
Business
Accounting
7.4 The Gardner Company, a client of your firm, has come to you with the following prob- lem. It has three clerical employees who must perform the following functions: a. Maintain the general ledger b. Maintain the accounts payable ledger c. Maintain the accounts receivable ledger d. Prepare checks for signature e. Maintain the cash disbursements journal f. Issue credits on returns and allowances g. Reconcile the bank account h. Handle and deposit cash receipts Assuming equal abilities among the three employees, the company asks you to assign the eight functions to them to maximize internal control. Assume that these em- ployees will perform no accounting functions other than the ones listed.

7.4 The Gardner Company, a client of your firm, has come to you with the following prob- lem. It has three clerical employees who must perform the following functions: a. Maintain the general ledger b. Maintain the accounts payable ledger c. Maintain the accounts receivable ledger d. Prepare checks for signature e. Maintain the cash disbursements journal f. Issue credits on returns and allowances g. Reconcile the bank account h. Handle and deposit cash receipts Assuming equal abilities among the three employees, the company asks you to assign the eight functions to them to maximize internal control. Assume that these em- ployees will perform no accounting functions other than the ones listed.

Accounting Information Systems
Accounting Information Systems
10th Edition
ISBN:9781337619202
Author:Hall, James A.
Publisher:Hall, James A.
Chapter2: Introduction To Transaction Processing
Section: Chapter Questions
Problem 24P
See similar textbooks
icon
Related questions
Question
7.4 The Gardner Company, a client of your firm, has come to you with the following prob- lem. It has three clerical employees who must perform the following functions: a. Maintain the general ledger b. Maintain the accounts payable ledger c. Maintain the accounts receivable ledger d. Prepare checks for signature e. Maintain the cash disbursements journal f. Issue credits on returns and allowances g. Reconcile the bank account h. Handle and deposit cash receipts Assuming equal abilities among the three employees, the company asks you to assign the eight functions to them to maximize internal control. Assume that these em- ployees will perform no accounting functions other than the ones listed. CHAPTER 7 CONTROL AND ACCOUNTING INFORMATION SYSTEMS 227 REQUIRED a. List four possible unsatisfactory pairings of the functions. b. State how you would distribute the functions among the three employees. Assume that with the exception of the nominal jobs of the bank reconciliation and the issu- ance of credits on returns and allowances, all functions require an equal amount of time. (CPA Examination, adapted) During digoouored th
Transcribed Image Text:7.4 The Gardner Company, a client of your firm, has come to you with the following prob- lem. It has three clerical employees who must perform the following functions: a. Maintain the general ledger b. Maintain the accounts payable ledger c. Maintain the accounts receivable ledger d. Prepare checks for signature e. Maintain the cash disbursements journal f. Issue credits on returns and allowances g. Reconcile the bank account h. Handle and deposit cash receipts Assuming equal abilities among the three employees, the company asks you to assign the eight functions to them to maximize internal control. Assume that these em- ployees will perform no accounting functions other than the ones listed. CHAPTER 7 CONTROL AND ACCOUNTING INFORMATION SYSTEMS 227 REQUIRED a. List four possible unsatisfactory pairings of the functions. b. State how you would distribute the functions among the three employees. Assume that with the exception of the nominal jobs of the bank reconciliation and the issu- ance of credits on returns and allowances, all functions require an equal amount of time. (CPA Examination, adapted) During digoouored th
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

SEE SOLUTIONCheck out a sample Q&A here
Blurred answer
Knowledge Booster
Bank reconciliation statement
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Century 21 Accounting Multicolumn Journal
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:
9781337679503
Author:
Gilbertson
Publisher:
Cengage
College Accounting, Chapters 1-27
College Accounting, Chapters 1-27
Accounting
ISBN:
9781337794756
Author:
HEINTZ, James A.
Publisher:
Cengage Learning,
Auditing: A Risk Based-Approach (MindTap Course L…
Auditing: A Risk Based-Approach (MindTap Course L…
Accounting
ISBN:
9781337619455
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
Cengage Learning
Century 21 Accounting General Journal
Century 21 Accounting General Journal
Accounting
ISBN:
9781337680059
Author:
Gilbertson
Publisher:
Cengage
College Accounting (Book Only): A Career Approach
College Accounting (Book Only): A Career Approach
Accounting
ISBN:
9781337280570
Author:
Scott, Cathy J.
Publisher:
South-Western College Pub
SEE MORE TEXTBOOKS