Horngren's Financial & Managerial Accounting, The Financial Chapters, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (6th Edition)

6th Edition

ISBN: 9780134642864

Author: Tracie L. Miller-Nobles, Brenda L. Mattison, Ella Mae Matsumura

Publisher: PEARSON

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Textbook Question

Chapter 7, Problem 7.15E

Evaluating internal control over cash payments

Gary’s Great Cars purchases high -performance auto parts from a Nebraska vendor. Dave Simon, the accountant for Gary’s, verifies receipt of merchandise and then prepares, signs, and mails the check to the vendor.

Requirements

1. Identify the internal control weakness over cash payments.

2. What could the business do to correct the weakness?

Expert Solution & Answer

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Chapter 7, Problem 7.14E

Chapter 7, Problem 7.16E

Chapter 7 Solutions

Horngren's Financial & Managerial Accounting, The Financial Chapters, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (6th Edition)

Ch. 7 - Prob. 1QC Ch. 7 - Prob. 2QC Ch. 7 - Prob. 3QC Ch. 7 - Prob. 4QC Ch. 7 - Prob. 5QC Ch. 7 - Prob. 6QC Ch. 7 - Prob. 7QC Ch. 7 - Prob. 9QC Ch. 7 - Prob. 10QC Ch. 7 - Prob. 11QC

Ch. 7 - Prob. 1RQ Ch. 7 - Prob. 2RQ Ch. 7 - What are the five components of internal control?...Ch. 7 - Prob. 4RQ Ch. 7 - What is separation of duties?Ch. 7 - Prob. 6RQ Ch. 7 - Prob. 7RQ Ch. 7 - Prob. 8RQ Ch. 7 - How do businesses control cash receipts by mail?Ch. 7 - Prob. 10RQ Ch. 7 - Prob. 11RQ Ch. 7 - Prob. 12RQ Ch. 7 - Prob. 14RQ Ch. 7 - Prob. 15RQ Ch. 7 - Prob. 16RQ Ch. 7 - Prob. 17RQ Ch. 7 - Prob. 18RQ Ch. 7 - Defining internal control Internal controls are...Ch. 7 - Prob. 7.2SE Ch. 7 - Prob. 7.3SE Ch. 7 - Prob. 7.4SE Ch. 7 - Prob. 7.5SE Ch. 7 - Prob. 7.7SE Ch. 7 - Prob. 7.8SE Ch. 7 - Prob. 7.9SE Ch. 7 - Prob. 7.10SE Ch. 7 - Prob. 7.11SE Ch. 7 - Prob. 7.12E Ch. 7 - Prob. 7.13E Ch. 7 - Prob. 7.14E Ch. 7 - Evaluating internal control over cash payments...Ch. 7 - Understanding internal control, components,...Ch. 7 - Prob. 7.17E Ch. 7 - Prob. 7.18E Ch. 7 - Prob. 7.20E Ch. 7 - Prob. 7.21E Ch. 7 - Prob. 7.23AP Ch. 7 - Prob. 7.24AP Ch. 7 - Prob. 7.25AP Ch. 7 - Prob. 7.26AP Ch. 7 - Prob. 7.27AP Ch. 7 - Prob. 7.28AP Ch. 7 - Prob. 7.29BP Ch. 7 - Prob. 7.30BP Ch. 7 - Prob. 7.31BP Ch. 7 - Prob. 7.32BP Ch. 7 - Prob. 7.33BP Ch. 7 - Prob. 7.34BP Ch. 7 - Prob. 7.2DC Ch. 7 - Levon Helm was a kind of one-man mortgage broker....Ch. 7 - Prob. 7.1CA

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There are several elements to internal controls. Which of the following would not address the issue of having cash transactions reported in the accounting records? A. One employee would have access to the cash register. B. The cash drawer should be closed out, and cash and the sales register should be reconciled on a prenumbered form. C. Ask customers to report to a manager if they do not receive a sales receipt or invoice. D. The person behind the cash register should also be responsible for making price adjustments.
What is the advantage of using technology in the internal control system? A. Passwords can be used to allow access by employees. B. Any cash received does not need to be reconciled because the computer tracks all transactions. C. Transactions are easily changed. D. Employees cannot steal because all cash transactions are recorded by the computer/cash register.

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