Instructions

With the class divided into groups, answer the following.

1. Identify the special journals that Ermler & Trump should have in its manual accounting system, List the column headings appropriate for each of the special journals.
2. What control and subsidiary accounts should be included in Ermler & 'Trump's manual account. ing system? Why?

Communication Activity

BYP7-3 Jill Locey, a classmate, has a part-time bookkeeping job. She is concerned about the ineff. ciencies in journalizing and posting transactions. Ben Newell is the owner of the company where Jill works. In response to numerous complaints from Jill and others, Ben hired two additional bookkeepers a month ago. However, the inefficiencies have continued at an even higher rate. The accounting information system for the company has only a general journal and a general ledger. Ben refuses to install a computerized accounting system.

Instructions

Now that Jill is an expert in manual accounting information systems, she decides to send a letter to Ben Newell explaining (1) why the additional personnel did not help and (2) what changes should be made to improve the efficiency of the accounting department. Write the letter that you think Jill should send.

Ethics Case

BYP7-4 Wiemers Products Company operates three divisions, each with its own manufacturing plant and marketing/sales force. The corporate headquarters and central accounting office are in Wiemers, and the plants are in Freeport, Rockport, and Bayport, all within 50 miles of Wiemers. Corporate management treats each division as an independent profit center and encourages competition among them. They each have similar but different product lines. As a competitive incentive, bonuses are awarded each year to the employees of the fastest-growing and most-profitable division.

Indy Grover is the manager of Wiemers's centralized computerized accounting operation that enters the sales transactions and maintains the accounts receivable for all three divisions. Indy came up in the accounting ranks from the Bayport division where his wife, several relatives, and many friends still work.

As sales documents are entered into the computer, the originating division is identified by code. Most sales documents (95%) are coded, but some (5%) are not coded or are coded incor rectly. As the manager, Indy has instructed the data-entry personnel to assign the Bayport code to all uncoded and incorrectly coded sales documents. This is done, he says, "in order to expedite processing and to keep the computer files current since they are updated daily." All receivables and cash collections for all threc divisions are handled by Wiemers as one subsidiary accounts receivable ledger.

Instructions

1. Who are the stakeholders in this situation?
2. What are the ethical issues in this case?
3. How might the system be improved to prevent this situation?