LooseLeaf for College Accounting: A Contemporary Approach
4th Edition
ISBN: 9781259995057
Author: M. David Haddock Jr. Professor, John Ellis Price, Michael Farina
Publisher: McGraw-Hill Education
expand_more
expand_more
format_list_bulleted
Question
Chapter 9, Problem 1CTP
1.
To determine
Determine the total amount of cash sales and cash shortage from August 1 to August 7.
2.
To determine
Prepare a
3.
To determine
Describe the required changes in the procedures in order to provide better management and control over the cash receipts.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solutionStudents have asked these similar questions
1. You are in line to check out at your favorite bagel store when the customer in front of you reaches for cream cheese in a container in a refrigerated area. You notice
she drops a $20 bill. She just paid for her food and left the store. You’re late for work already and your boss is a stickler for punctuality. What would you do
assuming you can catch up with the customer?
Your friend, Wendy Geiger, owns a small retail store that sells candies and nuts. Geiger acquires her goods from a few select vendors. She generally makes purchase orders by phone and on credit. Sales are primarily for cash. Geiger keeps her own manual accounting system using a general journal and a general ledger. At the end of each business day, she records one summary entry for cash sales. Geiger recently began offering items in creative gift packages. This has increased sales substantially, and she is now receiving orders from corporate and other clients who order large quantities and prefer to buy on credit. As a result of increased credit transactions in both purchases and sales, keeping the accounting records has become extremely time- consuming. Geiger wants to continue to maintain her own manual system and calls you for advice. Write a memo to her advising how she might modify her current manual accounting system to accommodate the expanded business activities. Geiger is…
Lena, Carrie, and Margaret work for a family physician. The doctor is knowledgeable about office management practices and has segregated the cash receipt duties as follows: Lena opens the mail and prepares a triplicate list of money received. Lena sends one copy of the list to Carrie, the cashier, who deposits the receipts daily in the bank. Margaret, the recordkeeper, receives a copy of the list and posts payments to the patients' accounts. About once a month, the office clerks have an expensive lunch they pay for as follows. First Carrie endorses a patient's check in the doctor's name and cashes it at the bank. Lena then destroys the remittance advice accompanying the check. Finally, Margaret posts payment to the customer's account as a miscellaneous credit. The three justify their actions by their relatively low pay and knowledge that the doctor will likely never miss the money. What went wrong with the doctor's internal controls?
Chapter 9 Solutions
LooseLeaf for College Accounting: A Contemporary Approach
Ch. 9 - Prob. 1.1SRQCh. 9 - What is a promissory note? In what situation would...Ch. 9 - How would the receipt of a 62 refund for supplies...Ch. 9 - Prob. 1.4SRECh. 9 - Prob. 1.5SRECh. 9 - Prob. 1.6SRACh. 9 - Prob. 2.1SRQCh. 9 - Prob. 2.2SRQCh. 9 - Prob. 2.3SRQCh. 9 - Prob. 2.4SRE
Ch. 9 - Prob. 2.5SRECh. 9 - Prob. 2.6SRACh. 9 - Prob. 3.1SRQCh. 9 - Prob. 3.2SRQCh. 9 - Prob. 3.3SRQCh. 9 - Prob. 3.4SRECh. 9 - Prob. 3.5SRECh. 9 - Prob. 3.6SRACh. 9 - Prob. 1CSRCh. 9 - Prob. 2CSRCh. 9 - Prob. 3CSRCh. 9 - Prob. 4CSRCh. 9 - Prob. 5CSRCh. 9 - Prob. 1DQCh. 9 - Prob. 2DQCh. 9 - Prob. 3DQCh. 9 - Prob. 4DQCh. 9 - Prob. 5DQCh. 9 - Prob. 6DQCh. 9 - Prob. 7DQCh. 9 - Prob. 8DQCh. 9 - Prob. 9DQCh. 9 - Prob. 10DQCh. 9 - Prob. 11DQCh. 9 - Prob. 12DQCh. 9 - Prob. 13DQCh. 9 - Prob. 14DQCh. 9 - Prob. 15DQCh. 9 - Prob. 16DQCh. 9 - Prob. 17DQCh. 9 - Prob. 18DQCh. 9 - Prob. 1ECh. 9 - Prob. 2ECh. 9 - Prob. 3ECh. 9 - Prob. 4ECh. 9 - Prob. 5ECh. 9 - Prob. 6ECh. 9 - Prob. 7ECh. 9 - Prob. 8ECh. 9 - Journalizing cash receipts, cash short or over,...Ch. 9 - Prob. 2PACh. 9 - Prob. 3PACh. 9 - Prob. 4PACh. 9 - Prob. 5PACh. 9 - Prob. 6PACh. 9 - Prob. 1PBCh. 9 - Prob. 2PBCh. 9 - Prob. 3PBCh. 9 - Prob. 4PBCh. 9 - Prob. 5PBCh. 9 - Prob. 6PBCh. 9 - Prob. 1CTPCh. 9 - Prob. 2CTPCh. 9 - Prob. 1MFCh. 9 - Prob. 2MFCh. 9 - Prob. 3MFCh. 9 - Prob. 4MFCh. 9 - Prob. 5MFCh. 9 - Prob. 6MFCh. 9 - Prob. 7MFCh. 9 - Prob. 8MFCh. 9 - Borrowing from Petty Cash Daniel Brown is in...Ch. 9 - Prob. 1FSA
Knowledge Booster
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
- Lena, Carrie, and Margaret work for a family physician. The doctor is knowledgeable about office management practices and has segregated the cash receipt duties as follows: Lena opens the mail and prepares a triplicate list of money received. Lena sends one copy of the list to Carrie, the cashier, who deposits the receipts daily in the bank. Margaret, the recordkeeper, receives a copy of the list and posts payments to the patients' accounts. About once a month, the office clerks have an expensive lunch they pay for as follows. First Carrie endorses a patient's check in the doctor's name and cashes it at the bank. Lena then destroys the remittance advice accompanying the check. Finally, Margaret posts payment to the customer's account as a miscellaneous credit. The three justify their actions by their relatively low pay and knowledge that the doctor will likely never miss the money. Would a bank reconciliation uncover this office fraud?arrow_forwardYou are working as a summer intern at a rapidly growing orgainc food distribution. Part of your responsibility is to assist in the accounts payable department. You notice that most of the bills are not paid with in discount period. The manager of the accounts payable sees the bills are organized by vendor, like the accounts payable ledger, and she is too busy to keep track of the discounts period. Besides, the owner has told her that The 1% and 2% discount available or not worth worrying about. 1. Explain to the owner why it is expensive not to take it advantage to cash discounts on credit purchases. suggest a way to file (organize) suppliers invoices so that they are paid with in the discount period.arrow_forwardLocker Rentals Corp. (LRC) operates locker rental services at several locations throughout thecity including the airport, bus depot, shopping malls, and athletics facilities. Unlike some of theold mechanical lockers that charge a fixed amount per use, LRC’s lockers operate electronicallyand are able to charge based on hours of use. The locker system transmits a daily message toLRC’s office indicating the number of hours that lockers have been used, which the office manager uses to determine when cash should be picked up at each location. LRC’s cash receipts system is described below.a. Two employees (“cash collection clerks”) are responsible for collecting cash from the lockers. Based on instructions from the office manager, one clerk collects cash from specificlocations on the west side of the city and the other collects from specific locations on theeast side.b. When each cash collection clerk returns with the cash, a supervisor counts the cash and prepares a cash count sheet.c. The…arrow_forward
- Wilson Petroleum is a local distributor of home heating oil. The firm also installs and services furnaces and heating systems in homes and small commercial buildings. The customer service department maintains sales and service records on current customers who number about 400. Detailed customer records are kept manually in file cabinets, and a small computer system holds all customer names and addresses for mailing and billing purposes. One full-time clerk maintains all the records and handles all billing and customer inquiries. Customers occasionally complain if delivery or service is late, but only one or two mild complaints are received each month. Delays are primarily a result of problems in the field rather than problems in assigning calls in the service department. A consultant has proposed a new computer system that will completely automate the customer service function. It will provide on-line billing and immediate access to all customer records. The cost of the…arrow_forwardThe City of Milford Parks and Recreation Department operates three community swimming pools. Each pool has a concession stand that sells candy. Each concession stand is staffed with two workers. To be eligible for volume discounts, the Parks and Recreation Department orders the candy for all three pools. Sandy Wells is responsible for ordering the concession stand goodies. Sandy uses a locked closet down the hall from her office at the Parks and Recreation headquarters to store the candy. She checks the closet periodically, and, when supplies seem low, she orders more. Whenever a concession stand needs to restock inventory, a worker goes to the Parks and Recreation headquarters to get the needed candy. Because Sandy knows all of the concession workers, she usually just hands the worker the key to the candy closet so the worker can get whatever is needed. Sandy has attached a chart to the closet door to keep track of candy withdrawals. On that chart, each worker records the number of…arrow_forwardRyan Egan and Jack Moody are both cash register clerks for Organic Markets. Lee Sorrell is the store manager for Organic Markets. The following is an excerpt of a conversation between Ryan and Jack: Ryan: Jack, how long have you been working for Organic Markets? Jack: Almost five years this November. You just started two weeks ago … right? Ryan: Yes. Do you mind if I ask you a question? Jack: No, go ahead. Ryan: What I want to know is, have they always had this rule that if your cash register is short at the end of the day, you have to make up the shortage out of your own pocket? Jack: Yes, as long as I’ve been working here. Ryan: Well, it’s the pits. Last week I had to pay in almost $40. Jack: It’s not that big a deal. I just make sure that I’m not short at the end of the day. Ryan: How do you do that? Jack: I just shortchange a few customers early in the day. There are a few jerks that deserve it anyway. Most of the time, their attention is elsewhere and they don’t think to check…arrow_forward
- (essay) Jiffy Trading runs 10 branches and pays for a variety of expenses. Anna, the Accounts Payable Clerk of Jiffy Trading writes the checks for each supplier and the Accounting Manager signs the checks. Anna decided she needs a raise and the Manager told her to wait for six months. Anna devised a plan to get a raise on her own. She created a new supplier account for her friend's business, Prime Auto Parts. Anna also created two purchase orders for Prime Auto Parts for P20,000 and P15,000 and wrote checks to pay theses invoices. She knows the Manager will sign all checks only looking at the checks over P30.000. She delivers the checks to her friend who will encash the checks and give the money to Anna. Is this a good way for Anna to obtain a raise? Eventually, what will be the effect of her actions? How can Jiffy prevent this type of incident?arrow_forwardAnita Zurbrugg was just hired as the assistant treasurer of Yorktown Stores. The company is a specialty chain store with nine retail stores concentrated in one metropolitan area. Among other things, the payment of all invoices is centralized in one of the departments Anita will manage. Her primary responsibility is to maintain the company’s high credit rating by paying all bills when due and to take advantage of all cash discounts. Chris Dadian, the former assistant treasurer who has been promoted to treasurer, is training Anita in her new duties. He instructs Anita that she is to continue the practice of preparing all checks “net of discount” and dating the checks the last day of the discount period. “But,” Chris continues, “we always hold the checks at least 4 days beyond the discount period before mailing them. That way, we get another 4 days of interest on our money. Most of our creditors need our business and don’t complain. And, if they scream about our missing the discount…arrow_forwardimmy Pace has recently been hired as the manager of Jittery Jon’s Coffee Shop. Jittery Jon’s Coffee Shop is a national chain of franchised coffee shops. During his first month as store manager, Jimmy encountered the following internal control situations:a.Jittery Jon’s Coffee Shop has one cash register. Prior to Jimmy’s joining the coffee shop, each employee working on a shift would take a customer order, accept payment, and then prepare the order. Jimmy made one employee on each shift responsible for taking orders and accepting the customer’s payment. Other employees prepare the orders.b.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 register. Jimmy expects each cashier to balance the drawer to the penny every time—no exceptions.c.Jimmy caught an employee putting a case of 1,000 single-serving tea bags in her car.…arrow_forward
- Mykayla Sanders was recently hired as the assistant treasurer of Merlin's Retail Outlet, a specialty chain store company that has nine retail stores concentrated in one metropolitan area. Among other things, the payment of all invoices is centralized in one of the departments Mykayla will manage. Her primary responsibility is to maintain the company's high credit rating by paying all bills when due and to take advantage of all cash discounts. Blake Hansen, the former assistant treasurer, who has been promoted to treasurer, is training Mykayla in her new duties. He instructs Mykayla that she is to continue the practice of preparing all checks "net of discount" and dating the checks the last day of the discount period. "But", Blake continues, "we always hold the checks at least 4 days beyond the discount period before mailing them. That way we get another 4 days of interest on our money. Most of our creditors need our business and don't complain. And, if they scream about our missing the…arrow_forwardAlice Trading runs 10 branches and pays for a variety of expenses. Zabrina, the Accounts Payable Clerk of Alice Trading writes the checks for each supplier and the Accounting Manager signs the checks. Zabrina decided she needs a raise and the Manager told her to wait for six months. Zabrina devised a plan to get a raise on her own. She created a new supplier account for her friend’s business, Prime Auto Parts. Zabrina also created two purchase orders for Prime Auto Parts for ₱20,000 and ₱15,000 and wrote checks to pay these invoices. She knows the Manager will sign all checks only looking at the checks over ₱30,000. She delivers the checks to her friend who will encash the checks and give the money to Zabrina. Is this a good way for Zabrina to obtain a raise? Eventually, what will be the effect of her actions? How can Jiffy prevent this type of incident?arrow_forwardWholesome and Happy Foods is a farm-to-family grocery store located in the Pacific Northwest. The company recently installed four self-checkout lanes that allow customers to scan their own groceries and pay for their purchases using an automated checkout kiosk. The kiosks are monitoredby a single attendant. In recent weeks, management has become concerned that some customers are not scanning all of the items when using the self-checkout lanes. Write a brief memo to your instructor suggesting features and capabilities for the kiosks that would serve as control procedures, ensuring that all items brought through the self-checkout lanes are properly scanned and purchased.arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Auditing: A Risk Based-Approach (MindTap Course L...AccountingISBN:9781337619455Author:Karla M Johnstone, Audrey A. Gramling, Larry E. RittenbergPublisher:Cengage Learning
Auditing: A Risk Based-Approach (MindTap Course L...
Accounting
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Cengage Learning
How Accounting Systems Work (Bookkeeping); Author: WolvesAndFinance;https://www.youtube.com/watch?v=aDtN9LEc2lM;License: Standard Youtube License