HORNGREN'S FINANCIAL & MANAGERIAL ACCO
16th Edition
ISBN: 9781323425084
Author: MILLER-NOBLES
Publisher: PEARSON C
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Question
Chapter 7, Problem 4QC
To determine
Separation of Duties
This is the internal control principle which reduces the possibilities of money embezzlement, by separating the responsibilities of employees. This ensures that the employees working in related jobs will not interfere with other employees’ responsibilities.
The following are the two applications of segregation of duties:
- 1. The related responsibilities should be shuffled and given to the employees who are not related. This application eliminates the possibility of fraud due to separation of responsibilities.
- 2. The custodian of asset should not be made responsible for accounting records or accounting department. This avoids the interference of custodians with the book-keeping responsibility, and keeps fraud at bay.
To determine: The importance of separation of duties
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Students have asked these similar questions
Separation of duties is important for internal control ofa.
a.cash receipts.
b. cash payments.
c. Neither of the above
d. Both a and b
Separation of duties is important for internal control of
cash receipts.
cash payments.
Neither of the above
Both a and b
Internal controls associated with the purchases and cash disbursements cycle include:
A
Separation of duties.
B
Adequate documentation.
C
Both separation of duties and adequate documentation.
D
Neither separation of duties nor adequate documentation.
Chapter 7 Solutions
HORNGREN'S FINANCIAL & MANAGERIAL ACCO
Ch. 7 - Prob. 1QCCh. 7 - Prob. 2QCCh. 7 - Prob. 3QCCh. 7 - Prob. 4QCCh. 7 - Prob. 5QCCh. 7 - Prob. 6QCCh. 7 - Prob. 7QCCh. 7 - Prob. 8QCCh. 7 - Prob. 9QCCh. 7 - Prob. 10QC
Ch. 7 - Prob. 1RQCh. 7 - Prob. 2RQCh. 7 - What are the five components of internal control?...Ch. 7 - Prob. 4RQCh. 7 - What is separation of duties?Ch. 7 - Prob. 6RQCh. 7 - Prob. 7RQCh. 7 - Prob. 8RQCh. 7 - How do businesses control cash receipts by mail?Ch. 7 - Prob. 10RQCh. 7 - Prob. 11RQCh. 7 - Prob. 12RQCh. 7 - Prob. 13RQCh. 7 - Prob. 14RQCh. 7 - Prob. 15RQCh. 7 - Prob. 16RQCh. 7 - Prob. 17RQCh. 7 - Defining internal control Internal controls are...Ch. 7 - Prob. 7.2SECh. 7 - Prob. 7.3SECh. 7 - Prob. 7.4SECh. 7 - Prob. 7.5SECh. 7 - Prob. 7.6SECh. 7 - Prob. 7.7SECh. 7 - Prob. 7.8SECh. 7 - Prob. 7.9SECh. 7 - Prob. 7.10SECh. 7 - Prob. 7.11ECh. 7 - Prob. 7.12ECh. 7 - Prob. 7.13ECh. 7 - Evaluating internal control over cash payments...Ch. 7 - Understanding internal control, components,...Ch. 7 - Prob. 7.16ECh. 7 - Prob. 7.17ECh. 7 - Prob. 7.18ECh. 7 - Prob. 7.19ECh. 7 - Prob. 7.21APCh. 7 - Prob. 7.22APCh. 7 - Prob. 7.23APCh. 7 - Prob. 7.24APCh. 7 - Prob. 7.25APCh. 7 - Prob. 7.26APCh. 7 - Prob. 7.27BPCh. 7 - Prob. 7.28BPCh. 7 - Prob. 7.29BPCh. 7 - Prob. 7.30BPCh. 7 - Prob. 7.31BPCh. 7 - Prob. 7.32BPCh. 7 - Prob. 7.33CPCh. 7 - Prob. 7.34PSCh. 7 - Prob. 7.2CTDCCh. 7 - Levon Helm was a kind of one-man mortgage broker....Ch. 7 - Prob. 7.1CTCA
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Similar questions
- Which statement is NOT correct for an expenditure system with proper internal controls?a. Cash disbursements maintain the check register.b. Accounts payable maintains the accounts payable subsidiary ledger.c. Accounts payable is responsible for paying invoices.d. Accounts payable is responsible for authorizing invoices.arrow_forwardThe internal control feature specific to petty cash is A. separation of duties B. assignment of responsibility C. proper authorization D. Imprest Systemarrow_forwardWhat are the steps in approach to internal control over cash receipts that utilizes separation of duties?arrow_forward
- As part of a strong internal control system, which of the following accounting duties needsto be separated from cash handling?a. Record keepingb. Filingc. Transaction approvald. Both a and c need to be separated from cash handling.arrow_forwardKeeping cash locked away is an example of which control activity? a. Authorization b. Performance reviews • c. Physical control d. Segregation of dutiesarrow_forwardA basic procedure of internal control over cash receipts is that the deposit of the cash and the recording of the receipts into the journal should be separated. a. True b. Falsearrow_forward
- Which of the following is true? a. The cash disbursement function is part of accounts payable. b. Cash disbursements is an independent accounting function. c. Cash disbursements is a treasury function. d. The cash disbursement function is part of the general ledger department.arrow_forwardIn what manner can cash receipts and cash disbursements be controlled?arrow_forwardWhich of the following statements are true regarding the control of cash receipts and cash payments? Custody over cash should be separate from the recordkeeping of cash.arrow_forward
- Which of the following is an effective internal control for cash payments? A.Payments should be authorised before they are made B.Payments to suppliers should be made as quickly as possible C.An experienced accountant should have total responsibility for all cash payment functions D.Supporting documentation should be destroyed immediately afterpayment to avoid incorrectly paying twicearrow_forwardWhich of the following is a good internal control for cash payments? A.Payments to suppliers should be made as quickly as possible B.An experienced accountant should have total responsibility for all cash payment functions. C.Payments should be authorised before they are made D.Supporting documentation should be destroyed immediately after payment to avoid incorrectly twice.arrow_forwardWhich of the following assets require the strongest of internal controls? A. inventory B. credit cards C. computer equipment D. casharrow_forward
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