Question 4What internal control or procedure(s) would provide protection against the following threats?A production order was initiated for a product that was already overstocked in the company’s warehouse.A production employee stole items of work-in-process inventoryA production employee entered a materials requisition form into the system in order to steal $300 worth of parts from the raw materials storeroomA parts storeroom clerk issued parts in quantities 10% lower than those indicated on several materials requisitions and stole the excess quantities.A production manager stole several expensive machines and covered up the loss by submitting a form to the accounting department indicating that the missing machines were obsolete and should be written off as worthless.

The internal cost system indicates the internal operating activities and functions followed by the…

Answered: What internal control or procedure(s)…

Corporate Financial Accounting

15th Edition

ISBN:9781337398169

Author:Carl Warren, Jeff Jones

Publisher:Carl Warren, Jeff Jones

Chapter7: Internal Control And Cash

Section: Chapter Questions

Problem 7.15EX

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Question 4

What internal control or procedure(s) would provide protection against the following threats?

A production order was initiated for a product that was already overstocked in the company’s warehouse.
A production employee stole items of work-in-process inventory
A production employee entered a materials requisition form into the system in order to steal $300 worth of parts from the raw materials storeroom
A parts storeroom clerk issued parts in quantities 10% lower than those indicated on several materials requisitions and stole the excess quantities.
A production manager stole several expensive machines and covered up the loss by submitting a form to the accounting department indicating that the missing machines were obsolete and should be written off as worthless.

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