Part I

(1) Jill, a supervisor at a construction company, distributes payroll and has authority to hire and fire employees. How might the owner of the construction company determine whether Jill has fictitious employees on the payroll and is secretly cashing their payroll checks for herself?

(2) Please explain why it is desirable to have at least two officials approve pay rate changes.

Part II

Jet-Clean sold washing machines totaling $1 million. Each washing machine carries a three-year warranty. Jet-Clean estimates that warranty repairs on the washing machines will cost 1 percent of the sales price.

(1) Record the entry to accrue Jet-Cleans warranty costs.

(2) Jet-Clean paid $750 for washing machine repairs under warranty. Please record this entry.