Chapter 7: Q12RQ (page 411)
When are the only times the Petty Cash account is used in a journal entry?
The petty cash account used the transaction of the petty cash fund made.
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Applying internal control over cash receipts by mail. Review the internal controls over cash receipts by mail presented in the chapter. Exactly what is accomplished by the final step in the process, performed by the controller?
What does the cash ratio help determine, and how is it calculated?
How do businesses control cash receipts by mail?
Evaluating internal control over cash payments Gary’s Great Cars purchases high-performance auto parts from a Nebraska vendor. Dave Simon, the accountant for Gary’s, verifies receipt of merchandise and then prepares, signs, and mails the check to the vendor.
Requirements
1. Identify the internal control weakness over cash payments.
2. What could the business do to correct the weakness?
Question: What is the difference between an internal auditor and an external auditor?
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