Question 1

(a) The Drink Manufacturing Company has three employees who work in the warehouse. All of

the warehouse workers are authorized to order inventory when it falls below the reorder

level. The workers doing a purchase order and mail it to the supplier of their choice. The

inventory is delivered directly to the warehouse. The workers send a memo to accounts

payable reporting the receipt of inventory.

Accounts payable compares the warehouse memo to the supplier's invoice. Accounts

payable prepares a check which the treasurer signs.

(b) Identify FIVE (5) classes of physical controls employed in the expenditure cycle and give

one example of each.