You are the owner of a full$-$service bookkeeping and auditing firm. A client contacts you about the internal control system within his automotive supply store. He is seeking a loan for expansion and must have his books audited. The auditor asked about his control procedures and documentation. He has no idea what the auditor is talking about and has asked you to evaluate the process and then reply in a memo with your observations and recommendations by the end of the week. Through interviews and observation you notice the following:

Purchase orders and sales invoices are not pre$-$numbered due to the higher cost of the forms.

To save time the sales clerk enters the sales at the end of the day into the accounting records, prepares the deposit, and delivers it to the bank.

The sales clerk, a trusted and long$-$term employee, grants sales returns at her discretion.

The purchasing manager both orders merchandise and approves the payment for the order.

Michael Stock, the bookkeeper, has not taken a vacation in three years.

Checks are brought to the owner twice a week for signing. He is overwhelmed by all of the paperwork and has asked only for the checks on which he stamps his signature.

No bank reconciliation has been prepared for the previous four months. Address this in your memo and also complete the bank reconciliation on the attached The bank statement for ABC Automotive Supply Company for the month indicates a balance of $$9,143\mathrm{.}11.$ All cash

receipts are deposited each evening in a night depository, after banking hours. The accounting records indicate the

following summary data for cash receipts and payments for the month:

Comparing the bank statement and the accompanying cancelled checks and memoranda with the records reveals the

folowing reconciling items:

a$.$ The bank had collected for ABC$$1,030$ on a note left for collection. The face of the note was $$1,000.$

b$.$ A deposit of $$1,852\mathrm{.}21,$ representing reciepts for the month had been made too late ot appear on the bank

statement.

c$.$ Checks outstanding totaled $$5,265\mathrm{.}27.$

d$.$ A check drawn for $$139$ had been incorrectly charged by the bank as $$157.$

e$.$ A check for $$30$ had been incorrectly recorded in the company's records as $$240.$ The check was for the purchase of

office supplies on account.

f$.$ Bank service charges for the month were $$18\mathrm{.}20.$

Prepare the bank reconcilliation for the month.spreadsheet.