For the following situations explain what you would do in the situation and identify two internal control problems that exist in each situation:

Suppose you have a part-time sales position over the Christmas holiday break in a small clothing store that is part of a national chain. The stores one full-time employee, with whom you have become friendly, hired you.

Situation A:

You arrive at the store at 6 pm to take over the evening shift from the full-time employee who hired you. You notice that this person takes a coat from a rack, puts it on, and leaves by the back door. You are not sure if the coat is one that was for sale or if it belonged to the employee.

Situation B:

You are the only person in the store on a busy evening. At closing time, you total the cash register and the receipts and discover that the cash register is $20 short of cash. You consider replacing the $20 out of your pocket because you think you may have made a mistake and are afraid you might lose your job if the company thinks you took the money.