Accounting Information Systems, 13

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Question: Accounting Information Systems, 13 Identify one or more control procedures (either general or app…
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Identify one or more control procedures
(either general or application controls, or
both) that would guard against each of the following errors or
problems.

a. Leslie Thomas, a secretary at the university,
indicated that she had worked 40 hours on
her regular time card. The university paid
her for 400 hours worked that week.

b. The aging analysis indicated that the Grab
and Run Electronics Company account was
so far in arrears that the credit manager
decided to cut off any further credit sales to
the company until it cleared up its account.
Yet, the following week, the manager noted
that three new sales had been made to that
company—all on credit.

c. The Small Company employed Mr. Fineus
Eyeshade to perform all its accounts
receivable data processing. Mr. Eyeshade’s
25 years with the company and his unassuming appearance helped him
conceal the
fact that he was embezzling cash collections
from accounts receivable to cover his gambling losses at the
racetrack.

d. The Blue Mountain Utility Company was
having difficulty with its customer payments. The payment amounts
were entered
directly onto a terminal, and the transaction file thus created was
used to update
the customer master file. Among the problems encountered with this
system were
the application of customer payments to
the wrong accounts and the creation of

multiple customer master file records for
the same account.

e. The Landsford brothers had lived in Center
County all their lives. Ben worked for the
local mill in the accounts payable department, and Tom owned the
local hardware
store. The sheriff couldn’t believe that the
brothers had created several dummy companies that sold fictitious
merchandise to
the mill. Ben had the mill pay for this
merchandise in its usual fashion, and he
wrote off the missing goods as “damaged
inventory.”

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