Homework Help is Here – Start Your Trial Now!
Business
Accounting
On July 25, the cashier resigned, effective at the end of the month. Before leaving on July 31, the cashier prepared the following bank reconciliation: Cash balance per books, July 31 Add outstanding checks: $10,400 $225 No. 5148 ..... 5149 750 5151 800 1,675 $12,075 Less undeposited receipts Cash balance per bank, July 31 1,500 $10,575 Deduct unrecorded note with interest 2,400 $ 8,175 True cash, July 31..... Calculator Tape of Outstanding Checks: 0* 225+ 750+ 800+ 1,675* Subsequently, the owner of Parker Company discovered that the cashier had stolen an unknown amount of undeposited receipts, leaving only $1,500 to be deposited on July 31. The owner, a close family friend, has asked for your help in determining the amount that the former cashier stole. 1. Determine the amount the cashier stole from Parker Company. Show your computa- tions in good form. 2. How did the cashier attempt to conceal the theft? 3. a. Identify two major weaknesses in internal controls that allowed the cashier to steal the undeposited cash receipts. b. - Recommend improvements in internal controls so that similar types of thefts of undeposited cash receipts can be prevented.

On July 25, the cashier resigned, effective at the end of the month. Before leaving on July 31, the cashier prepared the following bank reconciliation: Cash balance per books, July 31 Add outstanding checks: $10,400 $225 No. 5148 ..... 5149 750 5151 800 1,675 $12,075 Less undeposited receipts Cash balance per bank, July 31 1,500 $10,575 Deduct unrecorded note with interest 2,400 $ 8,175 True cash, July 31..... Calculator Tape of Outstanding Checks: 0* 225+ 750+ 800+ 1,675* Subsequently, the owner of Parker Company discovered that the cashier had stolen an unknown amount of undeposited receipts, leaving only $1,500 to be deposited on July 31. The owner, a close family friend, has asked for your help in determining the amount that the former cashier stole. 1. Determine the amount the cashier stole from Parker Company. Show your computa- tions in good form. 2. How did the cashier attempt to conceal the theft? 3. a. Identify two major weaknesses in internal controls that allowed the cashier to steal the undeposited cash receipts. b. - Recommend improvements in internal controls so that similar types of thefts of undeposited cash receipts can be prevented.

Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter5: Internal Control And Cash
Section: Chapter Questions
Problem 5.5.1C
See similar textbooks
icon
Related questions
Question

The records of Parker Company indicate a July 31 cash balance of $10,400, which includes undeposited receipts for July 30 and 31. The cash balance on the bank statement as of July 31 is $10,575. This balance includes a note of $2,250 plus $150 interest collected by the bank but not recorded in the journal. Checks outstanding on July 31 were as follows:
No. 2670, $1,050; No. 3679, $675; No. 3690, $1,650; No. 5148, $225; No. 5149, $750; and No. 5151, $800.

On July 25, the cashier resigned, effective at the end of the month. Before leaving on July 31, the cashier prepared the following bank reconciliation: Cash balance per books, July 31 Add outstanding checks: $10,400 $225 No. 5148 ..... 5149 750 5151 800 1,675 $12,075 Less undeposited receipts Cash balance per bank, July 31 1,500 $10,575 Deduct unrecorded note with interest 2,400 $ 8,175 True cash, July 31..... Calculator Tape of Outstanding Checks: 0* 225+ 750+ 800+ 1,675* Subsequently, the owner of Parker Company discovered that the cashier had stolen an unknown amount of undeposited receipts, leaving only $1,500 to be deposited on July 31. The owner, a close family friend, has asked for your help in determining the amount that the former cashier stole. 1. Determine the amount the cashier stole from Parker Company. Show your computa- tions in good form. 2. How did the cashier attempt to conceal the theft? 3. a. Identify two major weaknesses in internal controls that allowed the cashier to steal the undeposited cash receipts. b. - Recommend improvements in internal controls so that similar types of thefts of undeposited cash receipts can be prevented.
Transcribed Image Text:On July 25, the cashier resigned, effective at the end of the month. Before leaving on July 31, the cashier prepared the following bank reconciliation: Cash balance per books, July 31 Add outstanding checks: $10,400 $225 No. 5148 ..... 5149 750 5151 800 1,675 $12,075 Less undeposited receipts Cash balance per bank, July 31 1,500 $10,575 Deduct unrecorded note with interest 2,400 $ 8,175 True cash, July 31..... Calculator Tape of Outstanding Checks: 0* 225+ 750+ 800+ 1,675* Subsequently, the owner of Parker Company discovered that the cashier had stolen an unknown amount of undeposited receipts, leaving only $1,500 to be deposited on July 31. The owner, a close family friend, has asked for your help in determining the amount that the former cashier stole. 1. Determine the amount the cashier stole from Parker Company. Show your computa- tions in good form. 2. How did the cashier attempt to conceal the theft? 3. a. Identify two major weaknesses in internal controls that allowed the cashier to steal the undeposited cash receipts. b. - Recommend improvements in internal controls so that similar types of thefts of undeposited cash receipts can be prevented.
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 6 steps with 1 images

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
Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
Financial Accounting: The Impact on Decision Make…
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
Principles of Accounting Volume 1
Principles of Accounting Volume 1
Accounting
ISBN:
9781947172685
Author:
OpenStax
Publisher:
OpenStax College
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
Century 21 Accounting Multicolumn Journal
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:
9781337679503
Author:
Gilbertson
Publisher:
Cengage
Financial And Managerial Accounting
Financial And Managerial Accounting
Accounting
ISBN:
9781337902663
Author:
WARREN, Carl S.
Publisher:
Cengage Learning,
SEE MORE TEXTBOOKS