Accounting Information Systems 9th Edition
9th Edition
ISBN: 9781305756700
Author: Hall
Publisher: CENGAGE C
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Question
Chapter 4, Problem 3MCQ
To determine
Identify an incompatible task amongst the given options.
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Which of the following is incompatible task?a. The AR clerk prepares customer statements every month.b. The inventory control clerk updated the inventory subsidiary ledger.c. The AR clerk authorizes the write-off of bad debts.d. An accounting clerk updates both AR and APsubsidiary ledgers.e. All of the above are incompatible tasks.
Which situation indicates a weak internal control structure?a. the AR clerk authorizes the write off of bad debtsb. the record-keeping clerk maintains both AR and AP subsidiary ledgersc. the inventory control clerk authorizes inventory purchasesd. the AR clerk prepares customer statements every month
A client erroneously recorded a large purchase twice. Which of the following internal accounting control measures would be most likely to detect this error in a timely and efficient manner?
A. Sending written quarterly confirmations to all vendors,
B. Reconciling vendors' monthly statements with subsidiary payable ledger accounts.
C. Footing the purchases journal
D. Tracing totals from the purchases journal to the ledger accounts
Chapter 4 Solutions
Accounting Information Systems 9th Edition
Ch. 4 - Prob. 1RQCh. 4 - Prob. 2RQCh. 4 - What function does the receiving department serve...Ch. 4 - Prob. 4RQCh. 4 - Prob. 5RQCh. 4 - Prob. 6RQCh. 4 - Prob. 7RQCh. 4 - Prob. 8RQCh. 4 - Prob. 9RQCh. 4 - Distinguish between an edit run, a sort run, and...
Ch. 4 - Prob. 11RQCh. 4 - Prob. 12RQCh. 4 - Prob. 13RQCh. 4 - Prob. 14RQCh. 4 - Prob. 15RQCh. 4 - Prob. 16RQCh. 4 - In a manual system, after which event in the sales...Ch. 4 - Prob. 18RQCh. 4 - What document initiates the billing process?Ch. 4 - Prob. 20RQCh. 4 - Prob. 1DQCh. 4 - Prob. 2DQCh. 4 - Prob. 3DQCh. 4 - Prob. 4DQCh. 4 - Prob. 5DQCh. 4 - Prob. 6DQCh. 4 - Prob. 7DQCh. 4 - Prob. 8DQCh. 4 - What financial statement misrepresentations may...Ch. 4 - Prob. 10DQCh. 4 - Prob. 11DQCh. 4 - Prob. 12DQCh. 4 - Prob. 13DQCh. 4 - Prob. 14DQCh. 4 - Prob. 15DQCh. 4 - How is EDI more than technology? What unique...Ch. 4 - Prob. 17DQCh. 4 - Prob. 1MCQCh. 4 - Prob. 2MCQCh. 4 - Prob. 3MCQCh. 4 - Prob. 4MCQCh. 4 - Prob. 5MCQCh. 4 - Prob. 6MCQCh. 4 - Prob. 7MCQCh. 4 - Prob. 8MCQCh. 4 - Prob. 9MCQCh. 4 - Prob. 10MCQCh. 4 - Prob. 1PCh. 4 - Prob. 2PCh. 4 - Prob. 3PCh. 4 - Prob. 4PCh. 4 - Prob. 5PCh. 4 - Prob. 6PCh. 4 - Prob. 7PCh. 4 - Prob. 8PCh. 4 - INTERNAL CONTROL Iris Plant owns and operates...Ch. 4 - Prob. 10PCh. 4 - Prob. 11PCh. 4 - Prob. 12PCh. 4 - In 1989, Robert Smith opened a small fruit and...Ch. 4 - Prob. 2ICCCh. 4 - Prob. 3ICCCh. 4 - Prob. 4ICCCh. 4 - Prob. 5ICCCh. 4 - Prob. 6ICCCh. 4 - (Prepared by Will Richens and Michael Catchpole,...Ch. 4 - Prob. 8ICC
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- ich of the following controls is most likely to help ensure that all credit revenue transactions of an entity are recorded? Multiple Choice The billing department supervisor matches prenumbered shipping documents with entries in the sales journal. The billing department supervisor sends a copy of each approved sales order to the credit department for comparison to the custome authorized credit limit and current account balance. O The accounting department supervisor independently reconciles the accounts receivable subsidiary ledger to the accounts receivable account each month. A The accounting department supervisor controls the mailing of monthly statements to customers and investigates any customers. differences repoarrow_forwardWhen the store manager receives a requisition note, he issues three copies of purchase order. Two copies of these orders are sent to the vendor and one copy remains in the stores file. When the goods are received, the store manager matches the purchase order with the invoice and forwards them to accounts payable department for payment of dues. Which of the following statement best describes the internal control over the purchasing process? Inadequate control over accounts payable. Inadequate segregation of duties. Inadequate segregation of duties. Adequate internal control exists.arrow_forwardWhich of the following controls most likely would assure that all billed sales are correctly posted to the accounts receivable ledger? a. Each shipment on credit is supported by a prenumbered sales invoice. O b. Daily sales summaries are compared to daily postings to the accounts receivable ledger. O C. The accounts receivable ledger is reconciled daily to the control account in the general ledger. O d. Each sales invoice is supported by a prenumbered shipping document.arrow_forward
- The following are internal controls that theauditor has identified for various cycles.1. Sales invoices are matched with shipping documents and customer orders beforerecording in the sales journal.2. Receiving reports are prenumbered and accounted for on a daily basis.3. Sales invoices are independently verified before being sent to customers.4. Payments by check are received in the mail by the receptionist, who lists the checksand restrictively endorses them.5. Overtime hours for payroll are approved by the employee’s supervisor.6. Checks are signed by the company president, who compares the checks with theunderlying supporting documents.7. Unmatched shipping documents are accounted for on a daily basis.8. All payroll payments must have a valid employee identification number assigned bythe human resources department at the time of hiring.9. The accounts receivable master is reconciled to the general ledger on a monthly basis.a. For each internal control, identify the type(s) of…arrow_forwardThe following procedures are used by Complete Wholesale Incorporated.a. All sales are made on account, with each sale being indicated on a sequentially numberedsales invoice.b. Customer payments are received in the mail by the office receptionist, who sends the checksto a cashier for deposit and the remittance advices to the accounting department for recordingagainst the customer’s account balance.c. The office receptionist is assigned the job of handling all customer complaints.d. When a customer has a legitimate complaint about goods sold to the customer on account, thereceptionist will phone the accounting department to request that the customer’s account becredited for the sales allowance.e. The company’s inventory is stored in a locked warehouse that is monitored by surveillancecameras.f. Payments to the company’s suppliers are made only after the supplier’s invoice is received andcompared to the receiving report.Required:1. Indicate whether each procedure represents a strength or…arrow_forward1. SEGREGATION OF FUNCTIONS to the AR department, which adjusts the customer Which, if any, of the following situations represents improper segregation of functions? Explain your accounts to reflect the return. answer. a. The billing department prepares the customers' invoices and records the sale in the sales journal. b. Mail room clerk opens cash receipts envelopes from customers and also prepares the remittance list. c. Accounting clerk receives journal vouchers from various departments and also posts to the GL accounts. d. The sales department approves sales credit memos as the result of product returns and forwards thesearrow_forward
- The following are typical questions that might appear on an internal control questionnaire for accounts payable. 1. Are monthly statements from vendors reconciled with the accounts payable listing? 2. Are vendors’ invoices matched with receiving reports before they are approved for payment? Describe the purpose of each of the above internal control activities.arrow_forwardWhich, if any, of the following situations represent improper segregation of functions?a. The billing department prepares the customers’ invoices, and the accounts receivable department posts to the customers’ accounts.b. The sales department approves sales credit memos as the result of product returns, and subsequent adjustments to the customer accounts are performed by the accounts receivable department.c. The shipping department ships goods that have been retrieved from stock by warehouse personnel.d. The general accounting department posts to the general ledger accounts after receiving journal vouchers that are prepared by the billing department.arrow_forwardWhich statement about Revenue Cycle is correct? The customer and accounts payable department gets copies of the invoice.The sales order department prepares the invoice.The billing department uses the sales order and shipping documents to create the invoice.The accounts receivable department uses the sales order to update the accounts receivable subsidiary ledgerarrow_forward
- explain whether they are considered improper segregation of functions? a. The billig department prepares the customers, invoices and records the sale in the sales journal b. Mailroom clerk open cash receipts envelopes from customers and also prepares the remittance list. c. Accounting clerk recives journal vouchers from various departments and post togeneral ledger accounts d. The sales department approves sales credit memos as the result of production returns and forwards these to the Account Receivable department, which adjusts the customer accounts to reflect the return.arrow_forwardWhich, if any,of the followingsituations represent improper segregationof functions? Explain your answer. a. The billing deparment prepares the customers' invoices and records the sale in the sales journal. b. Mail room clerk opens cash receipts envelopes from customers and also prepares the remittance list. c. Accounting clerk receives journal vouchers from various departments and also posts to the GL accounts. d. The sales department approves sales credit memos as the result of product returns and forwards these to the AR department, which adjusts the customer accounts to reflect the return.arrow_forwardWhich of these arrangements of duties could most likely lead to an embezzlement or theft?a. The inventory warehouse manager has responsibility for making the physical inventory observation and reconciling discrepancies to the perpetual inventory records.b. The cashier prepared the bank deposit, endorsed the checks with a company stamp, and delivered the cash and checks to the bank for deposit (no other bookkeeping duties).c. The accounts receivable clerk received a list of payments received by the cashier so he could make entries in the customers’ accounts receivable subsidiary accounts.d. The financial vice president received checks made out to suppliers and the supporting invoices, signed the checks, and mailed the checks.arrow_forward
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