Glorias Fabrics is a large fabric provider to the general public. The accounting office has three employees:
Question:
Gloria’s Fabrics is a large fabric provider to the general public. The accounting office has three employees: accounts receivable clerk, accounts payable clerk, and a bookkeeper who manages the accounting function in the company. The accounts receivable clerk creates the sales invoices and records the cash receipts. The accounts payable clerk creates and pays purchase orders. The bookkeeper manages the accounting function, supervises all accounting office employees, and reconciles the checking account. Review the separation of duties for each employee: the accounts receivable clerk, the accounts payable clerk, and the bookkeeper. Identify the accounts and describe the transactions that would be recorded by that assigned job. Evaluate the internal control and the potential for fraud at Gloria’s Fabrics. How would you restructure the job responsibilities of each employee in order to strengthen the internal control of the firm?
Step by Step Answer:
College Accounting A Contemporary Approach
ISBN: 9781260780352
5th Edition
Authors: David Haddock, John Price, Michael Farina