Problem 5a (7 marks) The following are independent situations and represent errors or frauds that often occur in a business organization. i. ii. iii. iv. V. vi. vii. The selling price for all products handled by a particular salesperson was reduced from authorized prices by 25% to 40%. The salesperson was paid commission on gross sales made. Subsequently, management found that other sales personnel also reduced prices in order to meet sales targets. A few employees work in the company's warehouse do not receive their pay cheques for the month ended April 30. This occurred because the data-processing department misplaced some employee time cards. A customer account number was transposed during the order taking process. Consequently, the shipment was made to another customer. By the time the error was identified, the original customer decided to take its business elsewhere. An accounts receivable clerk with access to entering cash remittances misappropriated the cash remittances and recorded the credit to the customer's account as a discount. A customer order was filled and shipped to a former customer who had already declared bankruptcy and already owed a large amount to the company that was most likely uncollectible. Inventory records show that an adequate supply of copy paper should be in stock but none is available on the supply shelf. A purchasing agent regularly orders from a particular supplier who pay the employee kickbacks in order to win orders. The purchasing agent finds this supplier on the Internet about 3 months ago. Required: For each situation above, identify a control activity that could be effective in preventing or detecting the error or fraud. Briefly explain your answer. Problem 5b (3 marks) Jenny has recently been placed in charge of managing customer orders and ensuring products are delivered in a timely and accurate manner. However, upon taking this job she has noticed several problems with the customer ordering system. Such problems include orders forms that are missing essential information such as customer delivery ad- dress. Data field that contains improper data entries such as letters or negative numbers are input as quantity ordered. There are also orders for items that the firm no longer produces. Required: Suggest 3 data input controls that will help with these problems. Briefly explain what problem will be addressed by each control. (3 marks)