PART II — INTERNAL CONTROL OVER CASH RECEIPTS AND DISBURSEMENTS Six internal control principles related to cash transactions are discussed in the textbook. These principles, with code letters, are: CodeInternal Control Principle AEstablishment of responsibility BSegregation of duties CDocumentation procedures DPhysical controls EIndependent internal verification FHuman resource controls Instructions: Match the above principles to the following applications related to cash receipts and cash disbursements by placing the code in the space provided. Each code letter can be used once, more than once, or not at all. ____ 1.The duties of receiving and recording cash should be assigned to different individuals. ____ 2.Daily cash counts should be made by cashier department supervisors. ____ 3.Employees should be required to take vacations. ____ 4.Cash register tapes should be used for over-the-counter receipts. ____ 5.Each check should be compared with approved invoices before being issued. ____ 6.The duties of approving an item for payment and paying the item should be performed by different individuals. ____ 7.All checks should be prenumbered. ____ 8.Only the treasurer should be authorized to sign checks. ____ 9.All personnel who handle cash should be bonded. ____ 10.Blank checks should be stored in a safe, and access should be restricted.
PART II — INTERNAL CONTROL OVER CASH RECEIPTS AND DISBURSEMENTS
Six internal control principles related to cash transactions are discussed in the textbook. These principles, with code letters, are:
CodeInternal Control Principle
AEstablishment of responsibility
BSegregation of duties
CDocumentation procedures
DPhysical controls
EIndependent internal verification
FHuman resource controls
Instructions: Match the above principles to the following applications related to cash receipts and cash disbursements by placing the code in the space provided. Each code letter can be used once, more than once, or not at all.
____ 1.The duties of receiving and recording cash should be assigned to different individuals.
____ 2.Daily cash counts should be made by cashier department supervisors.
____ 3.Employees should be required to take vacations.
____ 4.Cash register tapes should be used for over-the-counter receipts.
____ 5.Each check should be compared with approved invoices before being issued.
____ 6.The duties of approving an item for payment and paying the item should be performed by different individuals.
____ 7.All checks should be prenumbered.
____ 8.Only the treasurer should be authorized to sign checks.
____ 9.All personnel who handle cash should be bonded.
____ 10.Blank checks should be stored in a safe, and access should be restricted.
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