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How do businesses control cash receipts over the counter?

Short Answer

Expert verified

Cash receipts are controlled with the help of a point-of-sale terminal.

Step by step solution

01

Definition of cash receipt

Cash receipts are the receipt that records the cash that the company receives. These receipts are immediately sent to the bank after they are received.

02

Businesses control cash receipt

Businesses control the cash receipts over the counter with the help of the point-of-sale terminal. A company records all the cash receipts in the cash register which helps in the cash receipts over-the-counter control. In this way, a company controls the cash receipts.

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Most popular questions from this chapter

What are the steps taken to ensure control over purchases and payments by check?

Applying internal control over cash payments by check

A purchasing agent for Franklin Office Supplies receives the goods that he purchases

and also approves payment for the goods.

Requirements

1. How could this purchasing agent cheat his company?

2. How could Franklin avoid this internal control weakness?

Match the accounting terminology to the definitions.

1. Sarbanes-Oxley Act

2. Internal control

3. Encryption

4. Separation of duties

5. Internal auditors

a. Organizational plan and all the related measures adopted by an entity to safeguard assets,

encourage employees to follow company policies, promote operational efficiency, and ensure

accurate and reliable accounting records.

b. Employees of the business who ensure that the companyโ€™s employees are following company

policies and meeting legal requirements and that operations are running efficiently.

c. Rearranging plain-text messages by a mathematical processโ€”the primary method of

achieving security in e-commerce.

d. Requires companies to review internal control and take responsibility for the accuracy and

completeness of their financial reports.

e. Dividing responsibilities between two or more people.

Recording transactions from a bank reconciliation Review your results from preparing Guard Dog Security Systemsโ€™ bank reconciliation in Short Exercise S7-9. Journalize the companyโ€™s transactions that arise from the bank reconciliation. Include an explanation with each entry.

Identifying internal controls. Consider each situation separately. Identify the missing internal control procedure from these characteristics:

โ€ข Assignment of responsibilities

โ€ข Separation of duties

โ€ข Audits

โ€ข Electronic devices

โ€ข Other controls (specify)

a. While reviewing the records of Quality Pharmacy, you find that the same Team member orders merchandise and approves invoices for payment.

b. Business is slow at Amazing Amusement Park on Tuesday, Wednesday, and Thursday nights. To reduce expenses, the business decides not to use a ticket taker on those nights. The ticket seller (cashier) is told to keep the tickets as a record of the number sold.

c. The same trusted team member has served as a cashier for 12 years.

d. When business is brisk, Fast Mart deposits cash in the bank several times during the day. The manager at one store wants to reduce the time employees spend delivering cash to the bank, so he starts a new policy. Cash will build up over weekends, and the total will be deposited on Monday.

e. Grocery stores such as Convenience Market and Natural Foods purchase most merchandise from a few suppliers. At another grocery store, the manager decides to reduce paperwork. He eliminates the requirement that the receiving department prepare a receiving report listing the goods actually received from

the supplier.

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