Assume that you are a cashier and your manager requires that you immediately enter each sale when it occurs. Recently, lunch hour traffic has increased and the assistant manager asks you to avoid delays by taking customers’ cash and making change without entering sales. The assistant manager says she will add up cash and enter sales after lunch. She says that, in this way, customers will be happy and the register record will always match the cash amount when the manager arrives at three o’clock.
The advantage to the process proposed by the assistant manager includes improved customers services, fewer delays, and less work for you. The disadvantage is that the assistant manager could steal cash by simply recording less sales than the cash received and then pocketing the excess cash. You decide to reject her suggestion without the manager’s approval and to confront her on the ethics of her suggestion.
Required
Propose and evaluate two other courses of action you might consider, and explain why.
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Loose Leaf for Financial Accounting: Information for Decisions
- Describe the who, what, where, and how of the following scenario: A customer gives his purchase to a sales clerk, who enters the sale in a cash register and puts the money in the register drawer. At the end of the day, the sales clerk gives the cash and the register tape to the cashier.arrow_forwardA retail store normally has three people working in the evening. All of the employees have access to the same cash register. For the last month, the cash count at the end of the evening has been recording losses. The losses range from $5 to $300. So the manager has decided to be the only one to count the cash at the end of the evening to keep the losses from happening. Discuss if the change made by the manager is a good one. Will the losses keep happening, or will this change prevent losses due to theft? What other recommendations and changes should be considered by this manager?arrow_forwardYou are the bookkeeper at a small merchandising firm. You are comparing the income statements from the last three years. You notice that the Purchases Returns and Allowances account (as a percentage of net sales) has been increasing at an alarming rate. If you were a manager, to whom would you speak in the organization to help you understand why so much merchandise is being returned? What types of questions would you ask?arrow_forward
- Assume that you are a cashier, and your manager requires that you immediatelyenter each sale when it occurs. Recently, lunch hour traffic has increased, and theassistant manager asks you to avoid delays by taking customers’ cash and makingchange without entering sales. The assistant manager says she will add up cash andenter sales after lunch. She says that, in this way, customers will be happy to, andthe register record will always match the cash amount when the manager arrives atthree o’clock.The advantages to the process proposed by the assistant manager include improvedcustomer service, fewer delays, and less work for you. The disadvantage is that the assistant manager could steal cash by simply recording less sales than the cashreceived and them pocketing the excess cash. You decide to reject her suggestionwithout the manager’s approval and to confront her on the ethics of her suggestion.Propose and evaluate two other courses of action you might consider and explainwhyarrow_forwardCase Study: Hassam runs a fruit stall at the local market and at the end of each day he banks the cash in the cash register. the cash register records each sale and can provide a total for each day but Hassam believes that often the staffs are too busy and do not always enter the sales in the cash register but simply put the cash in the till. the total from the cash register is produced each month for the budiness's accountant to prepare financial statements. Recently, Hassam employed a university student to work on weekends and he is concerned that after this the daily amount banked seems to have decreased even though Hassam feels that sales have not really changed. the student often talks about how he spends his evenings at the casino in the hope of winning enough to pay for his university studies so that he doesn't have to work every weekend. reqiured: please answer this question by listing to Hassam 5 controls he could put in place to minimize the risk of one of his employees…arrow_forwardAs the full-time bookkeeper, your job is to make any corrections to the general ledger accounts. Each correction must include the reason for the change and the effect on each account, whether it is an increase or decrease. For the third time this month, a co-worker has recorded a cash receipt twice and wants you to record a correcting entry that will reverse the mistakes. The correcting entry will record a credit to the Cash account and a debit to the Sales account. Your co-worker has offered to buy you dinner for fixing this mistake. Respond to the following in a minimum of 175 words: What should you investigate before making a decision about the correcting entry? What is happening to the Cash account? Would you accept a dinner offer from your co-worker for fixing the mistake?arrow_forward
- Someone answered the question below but its incomplete . I was checking my answers I am unsure about the solution , For example #1 recommended change would be enhance the personnel policies?Please advise. 7 The following control procedures are used in Parker Company for over-the-counter cash receipts. Each store manager is responsible for interviewing applicants for cashier jobs. They are hired if they seem honest and trustworthy. All over-the-counter receipts are registered by three clerks who share a cash register with a single cash drawer. At the end of each day, the total receipts are counted by the cashier on duty and reconciled to the cash register total. The company accountant makes the bank deposit and then records the day's receipts. To minimize the risk of robbery, cash in excess of $100 is stored in an unlocked briefcase in the stockroom until it is deposited in the bank. check_circle Expert Answer thumb_up thumb_down Step 1 Internal Control: It refers to…arrow_forwardYou oversee the $250 petty cash for your company. When an employee needs a special item that is not in inventory, you take money from petty cash to purchase that item. One day, you are short on cash for lunch. You decide to borrow $10 each day for the next 3 days until payday for a total of $30 from petty cash. After payday, you do not have enough to repay petty cash, so you decide to record a cash short/over expense of $30. If so, what steps should be taken to fix this problem? If not, why not?arrow_forwardSusan, a store supervisor, is responsible for creating a summary of the store’s transactions at the end of each day. She is also responsible for checking the register tape against the credit slips and cash in the register, and then depositing the money in the morning. Susan recently took on a new role as head bookkeeper, when the former one retired. Susan would occasionally change a transaction on the register and pocket the extra money. Now, she waits until the end of the year for the store manager to go on holiday break. She writes a check for herself in the amount of an invoice, then cancels the check originally written to pay for the invoice. She cashes the check for herself, and waits a few weeks before resubmitting the invoice. When the owner writes the second check, Susan records this in the cash disbursements journal, and then deposits the check. She then files it with all other paid invoices. Susan has been following this practice successfully for several years and feels…arrow_forward
- The following procedures are used by The Taco Shop.a. Customers pay cash for all food orders. Cash is placed in a cash register and a receipt is issuedupon request by the customer.b. At the end of each day, the cashier counts the cash, prepares a cash count sheet, and has themanager count the cash and review and sign the cash count sheet.c. At three times during the day, excess cash is removed from the cash registers and placed in avault until it is taken for night deposit at the local bank.d. Orders for drink cups, straws, condiments, and other supplies are written on prenumbered purchase order forms and are approved by the manager before being sent to an authorized supplier.e. When supplies are received, they are stacked just inside the back door to the kitchen, which isleft unlocked because part-time employees frequently arrive and leave at various times duringthe day.Required:1. Indicate whether each procedure represents a strength or weakness. Explain your reasons.2. For each…arrow_forwardA retail store normally has three people working in the evening. All of the employees have access to the same cash register. For the last month, the cash count at the end of the evening has been recording losses. The losses range from $5 to $300. So, the manager has decided to be the only one to count the cash at the end of the evening to keep the losses from happening. Discuss if the change made by the manager is a good one. Will the losses keep happening, or will this change prevent losses due to theft? What other recommendations and changes should be considered by this manager?arrow_forwardThe following procedures were recently implemented by SUP Yoga Co.: Each cashier is assigned a separate cash register drawer to which no other cashier has access. All sales are rung up on the cash register, and a receipt is given to the customer. All sales are recorded on a record locked inside the cash register. At the end of a shift, each cashier counts the cash in his or her cash register, unlocks the cash register record, and compares the amount of cash with the amount on the record to determine cash shortages and overages. Checks received through the mail are given daily to the accounts receivable clerk for recording collections on account and for depositing in the bank. Vouchers and all supporting documents are stamped PAID after being paid by the treasurer. Disbursements are made from the petty cash fund only after a petty cash receipt has been completed and signed by the payee. The bank reconciliation is prepared by the accountant. Instructions: Indicate whether each of the…arrow_forward
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