Background: Some of Crown Company’s cash receipts from customers are received by the company with the regular US mail. The company’s recordkeeper opens these letters and deposits the cash received each day. Required: Part 1a. Identify any internal control problem(s) with this arrangement. Explain your answer(s). Part 1b. What changes to Crown's internal control system do you recommend? Explain your answer(s).
Background: Some of Crown Company’s cash receipts from customers are received by the company with the regular US mail. The company’s recordkeeper opens these letters and deposits the cash received each day.
Required:
Part 1a. Identify any internal control problem(s) with this arrangement. Explain your answer(s).
Part 1b. What changes to Crown's internal
Question #2 – Internal Control Recommendations:
What internal control procedures would you recommend in each of the following two situations?
Required:
Part 2a. A concession company has one employee who sells towels, coolers, and
sunglasses at the beach. Each day, the employee is given enough towels, coolers, and sunglasses to last through the day and enough cash to make change. The money is kept in a box at the stand.
Part 2b. An antique store has one employee who is given cash and sent to garage sales each weekend. The employee pays cash for any merchandise acquired that the antique store resells.
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