Accounting Team Project
Naomi Konen and Chue Lee
a) Joan’s first mistake is not using control of cash receipts. She is having only one person go through the whole accounting controls process. There should be other people involved in this process including Joan herself. Joan must also realize the limitations of human controls. One person going through the entire process is bound to make a human error. b) Joan initially failed by trying to joke about her employee stealing. Stealing is a serious matter and should be treated as such. Joan needs to use the elements of internal controls to safeguard her business against employee theft. Joan should have followed policy on employee theft. c) I disagree with Joan’s way of handling cash however feel that she is moving in the right direction. There are not enough checks and balances with Joan’s system. I feel that Joan should be involved in the process of controlling cash receipts.
a) When an item is returned to the store, the store clerk can make an exceeding amount of cash refund up to $50 each time so he can get at least a portion of it for any particular returning item because there’s no receipt to compare, showing how much the price is. b) The weakness of it is that it is refundable with cash for any returned item under $50, and a check will mailed to the customer for any item that is above $50. c) By issuing a store‘s credit in place of a cash for all merchandise returned without receipts may reduce the possibility of theft down just a little. However, it is not totally secure. It is only preventing the employees to not be able to use the store’s credit and steal cash, but the credits are still be available to his friends and family members as well. d) If the store wants to maintain the policy of issuing cash refunds without receipts, one better way to safeguard and to improve its internal control is to have a check mailed to the only customer whom had returned the store’s...
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