Internal Controls   Faith Cassen has recently been hired as the manager of Gibraltar Coffee Shop. Gibraltar Coffee Shop is a national chain of franchised coffee shops.During her first month as store ma11age1; Faith encountered the following internal control situations:   a.Faith caught an employee putting a case of 1,000 singleserving tea bags in his car. Not wanting to create a scene, Faith smiled and said, "I don't think you're putting those tea bags on the right shelf. Don't they belong inside the coffee shop?"The employee returned the tea bags to the stockroom.   b.Gibraltar Coffee Shop has one cash register.Prior to Faith'sjoining the coffee shop, each employee working on a shiftwould take a customer order,accept payment,and then prepare the order. Faith made one employee on each shift responsible for taking orders and accepting the customer's Other employees prepare the orders.   c.Because only one employee uses the cash register,that employee is responsible for counting the cash at the end of the shift and verifying that the cash in the drawer matches the amount of cash sales recorded by the cash Faith expects each cashier to balance the drawer to the penny eve1ytime-no exceptions.   State whether you agree or disagree with Faith's method of handling each situation and explain your answer.

Financial Accounting: The Impact on Decision Makers
10th Edition
ISBN:9781305654174
Author:Gary A. Porter, Curtis L. Norton
Publisher:Gary A. Porter, Curtis L. Norton
Chapter6: Cash And Internal Control
Section: Chapter Questions
Problem 6.5MCP
icon
Related questions
Question

Internal Controls

 

Faith Cassen has recently been hired as the manager of Gibraltar Coffee Shop. Gibraltar Coffee Shop is a national chain of franchised coffee shops.During her first month as store ma11age1; Faith encountered the following internal control situations:

 

a.Faith caught an employee putting a case of 1,000 singleserving tea bags in his car. Not wanting to create a scene, Faith smiled and said, "I don't think you're putting those tea bags on the right shelf. Don't they belong inside the coffee shop?"The employee returned the tea bags to the stockroom.

 

b.Gibraltar Coffee Shop has one cash register.Prior to Faith'sjoining the coffee shop, each employee working on a shiftwould take a customer order,accept payment,and then prepare the order. Faith made one employee on each shift responsible for taking orders and accepting the customer's Other employees prepare the orders.

 

c.Because only one employee uses the cash register,that employee is responsible for counting the cash at the end of the shift and verifying that the cash in the drawer matches the amount of cash sales recorded by the cash Faith expects each cashier to balance the drawer to the penny eve1ytime-no exceptions.

 

State whether you agree or disagree with Faith's method of handling each situation and explain your answer.

Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Control Procedures
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
Financial Accounting: The Impact on Decision Make…
Financial Accounting: The Impact on Decision Make…
Accounting
ISBN:
9781305654174
Author:
Gary A. Porter, Curtis L. Norton
Publisher:
Cengage Learning
Survey of Accounting (Accounting I)
Survey of Accounting (Accounting I)
Accounting
ISBN:
9781305961883
Author:
Carl Warren
Publisher:
Cengage Learning
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Auditing: A Risk Based-Approach (MindTap Course L…
Auditing: A Risk Based-Approach (MindTap Course L…
Accounting
ISBN:
9781337619455
Author:
Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:
Cengage Learning
Managerial Accounting: The Cornerstone of Busines…
Managerial Accounting: The Cornerstone of Busines…
Accounting
ISBN:
9781337115773
Author:
Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
Publisher:
Cengage Learning