This is a continuation of comprehensive question.

1. Since the Robinson Company is short of cash, the deposit of receipts is also expedited. The receptionist turns over all mail receipts and related correspondence to the accounts receivable clerk who examines the checks and determines that the accompanying vouchers or correspondence contains enough detail to permit posting of the accounts. The accounts receivable clerk then endorses the checks and gives them to the cashier who prepares the daily deposit. No currency is received in the mail and no paint is sold over the counter at the factory.

2. The accounts receivable clerk uses the vouchers or correspondence that accompanied the checks to post the accounts receivable ledger cards. The bookkeeping machine prepares a cash receipts register as a carbon copy of the postings. Monthly the general ledger clerk summarizes the cash receipts register for posting to the general ledger accounts. The accounts receivable clerk also corresponds with customers about unauthorized deductions for discounts, freight or advertising allowance, returns, etc. and prepares the appropriate credit memos. Disputed items of large amount are turned over to the sales manager for settlement. Each month, the accounts receivable clerk prepares a trial balance of the open accounts receivable and compares the resultant total with the general ledger control account for accounts receivable.

Required:

a. Identify (1) errors and irregularities that could occur and (2) the necessary control procedures. Organize your answer around the primary functions for cash receipts transactions.

b. Which weaknesses, if any, do you consider material? Why?