西方财务会计课后题58答案.docx

西方财务会计课后题58答案.docx

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西方财务会计课后题58答案

CHAPTER5

1.Theknowledgethatjobrotationispracticedandthatoneemployeemayperformanother’sjobatalaterdatetendstodiscouragedeviationsfromprescribedprocedures.Also,rotationhelpstodiscloseanyirregu

laritiesthatmayoccur.

2.Authorizingcompletecontroloverasequenceofrelatedoperationsbyoneindividualpresentsopportunitiesforinefficiency,errors,andfraud.Thecontroloverasequenceofoperationsshouldbedividedsothattheworkofeachemployeeisautomaticallycheckedbyanotheremployeeinthenormalcourseofwork.Asystemfunctioninginthismannerhelpspreventerrorsandinefficiency.Fraudisunlikelywithoutcollusionbetweentwoormoreemployees.

3.Toreducethepossibilityoferrorsandembezzlement,thefunctionsofoperationsandaccountingshouldbeseparated.Thus,oneemployeeshouldnotberesponsibleforhandlingcashreceipts（operations）andmaintainingtheaccountsreceivablerecords（accounting）.

4.No.Combiningtheresponsibilityforrelatedoperations,suchascombiningthefunctionsofpurchasing,receiving,andstoringofsupplies,increasesthepossibilityoferrorsandfraud.

5.Thecontrolprocedurerequiringthatresponsibilityforasequenceofrelatedoperationsbedividedamongdifferentpersonsisviolatedinthissituation.Thisweaknessintheinternalcontrolmaypermitirregularities.Forexample,theticketseller,whileactingastickettaker,couldadmitfriendswithoutaticket.

6.Theresponsibilityformaintainingtheaccountingrecordsshouldbeseparatedfromtheresponsibilityforoperationssothattheaccountingrecordscanserveasanindependentcheckonoperations.

7.Theindividualaccountsreceivableledgeraccountsprovidebusinessmanagersinformationonthestatusofindividualcustomeraccounts,whichisnecessaryformanagingcollections.Managersneedtoknowwhichcustomersowemoney,howmuchtheyowe,andhowlongtheamountowedhasbeenoutstanding.

8.Themajoradvantagesoftheuseofspecialjournalsaresubstantialsavingsinrecord-keepingexpensesandareductionofrecord-keepingerrors.

9.a.250；b.None

10.a.250；b.1

11.a.Sometimefollowingtheendofthecurrentmonth,oneoftwothingsmayhappen:

（1）anoverduenoticewillbereceivedfromHoffmanCo.,and/or

（2）aletterwillbereceivedfromHofferCo.,informingthebuyeroftheoverpayment.（Itisalsopossiblethattheerrorwillbediscoveredatthetimeofmakingpaymentiftheoriginalinvoiceisinspectedatthetimethecheckisbeingwritten.）

b.Thescheduleofaccountspayablewouldnotagreewiththebalanceoftheaccountspayableaccount.Theerrormightalsobediscoveredatthetimetheinvoiceispaid.

c.Thecreditorwillcalltheattentionofthedebtortotheunpaidbalanceof$1,000.

d.Theerrorwillbecomeevidentduringtheverificationprocessattheendofthemonth.Thetotaldebitsinthepurchasesjournalwillbelessthanthetotalcreditsby$2,000.

12.a.No,theerrorwillnotcausethetrialbalancetotalstobeunequal.

b.No,thesumofthebalancesinthecreditorsledgerwillnotagreewiththebalanceoftheaccountspayableaccountinthegeneralledger.

13.a.Cashpaymentsjournal；b.Purchasesjournal；c.Cashpaymentsjournal

d.Purchasesjournal；e.Cashpaymentsjournal

14.Anelectronicformisasoftwarewindowthatprovidestheinputsforaparticulartransaction.Forexample,acheckformprovidestheinputs（payee,amount,date）foracashpaymenttransaction.Anelectronicinvoiceprovidestheinputs（customer,amountsold,itemsold）forrecordingrevenuesearnedonaccount.

15.Theuseofcontrollingaccountstoverifytheaccuracyofsubsidiaryaccountsisusedinamanualsystem.Inacomputerizedsystem,itisassumedthatthecomputerwillaccuratelysumtheindividualtransactionsinthesubsidiaryaccountsindeterminingtheaggregatebalance.Thus,thereisnoneedforcontrollingaccountsforcontrollingtheaccuracyoftheindividualpostings.

16.Forautomatedsystemsthatuseelectronicformsthespecialjournalsarenotusedtorecordoriginaltransactions.Rather,elec-tronicformscapturetheoriginaltransactiondetailfromaninvoice,forexample,andautomaticallypostthetransactiondetailstotheappropriateledgeraccounts.

17.E-commercecanbeusedbyabusinesstoconducttransactionsdirectlywithcustomers.Thus,anordercanbereceiveddirectlyfromthecustomer’sInternetinputandcashcanbereceivedfromthecreditcard.Manytimes,thecashisreceivedpriortoactuallyshippingtheproduct,resultinginafasterrevenue/collectioncycle.Reducingpaperworkthroughoutthecyclealsoimprovestheefficiencyoftheprocess.Forexample,alloftheaccountingtransactionscanbefedautomaticallyfromtheinitialWeb-basedinputs.

Ex.5–1

Asaninternalauditor,youwouldprobablydisagreewiththechangeinpolicy.FirstCharterhassomenormalbusinessriskassociatedwithdefaultonbankloans.Onewaytohelpminimizethisistocarefullyevaluateloanapplications.Largeloanspresentgreaterriskintheeventofdefaultthandosmallerloans.Thus,itisreasonabletohavemorethanonepersoninvolvedinmakingthedecisiontograntalargeloan.Inaddition,loansshouldbegrantedontheirmerits,notonthebasisoffavoritismormereassociationwiththebankpresident.Allowingthebankpresidenttohavesoleauthoritytograntlargeloanscanleadtothepresidentgrantingloanstofriendsandbusinessassociates,withouttherequiredduediligence.Thiscanresultinabankbecomingexposedtoverypoorcreditrisks.Indeed,thisscenarioisoneofthecausesofsavingsandloanandbankfailuresofthepast.

Ex.5–2

Thisisanexampleofafraudwithsignificantcollusion.Fraudsthatareperpetratedwithmultiplepartiesindifferentpositionsofcontrolmakedetectingfraudmoredifficult.Inthiscase,thefraudbeganwithanemployeeresponsibleforauthorizingclaimpayments.Thisisasensitivepositionbecausehisdecisionswouldinitiatepayments.However,claimswouldneedtobeauthorizedandverifiedbeforepaymentwouldbemade.Knowingthis,theemployeemadesureeachclaimhadaphony“victim.”Thus,therewasaverifiablestorybehindeachclaim.Onlybytrackingphysicalevidenceoftheaccidentcoulditbediscoveredthattheclaimwasfictitious.However,theverynatureoftheprocesswastoresolvesmallclaimsquicklywithoutexcessivecontrol.Lastly,corruptlawyerswerebroughtintothefraudtoactasattorneysfortheclaimants.Thisgavetheclaimsevenmorecredibility.Inactuality,thelawyershaddonelegitimatebusinesswiththetruckingcompany,soallappearednormal.Thisfraudwasdiscoveredwhenthefraudulentemployee’sbanknoticedirregularitiesinhisbankaccountandnotifiedauthorities.Asthesayinggoes,“Followthemoney!

”Asasidenote,thecorruptclaimsadministratorfellintothisbehaviorduetogamblingproblems.

Ex.5–3

EventSoundshouldnothavereliedontheunusualnatureofthevendorsanddeliveryfrequencytouncoverthisfraud.Thepurchaseandpaymentcycleisoneofthemostcriticalbusinesscyclestocontrol,becausethepotentialforabuseissogreat.Purchasesshouldbeinitiatedbyarequisitiondocument.Thisdocumentshouldbecountersignedbyasuperiorsothattwopeopleagreeastowhatisbeingpurchased.Therequisitionshouldinitiateapurchaseordertoavendorforgoodsorservices.Thevendorrespondstothepurchaseorderbydeliveringthegoods.Thegoodsshouldbeformallyreceivedusingareceivingdocument.Anaccountspayableclerkmatchestherequisition,purchaseorder,andinvoicebeforeanypaymentismade.Such“triplematching”preventsunauthorizedrequestsandpayments.Inthiscase,therequestswereunauthorized,suggestingthattheemployeehadsoleauthoritytomakearequest.Second,thisemployeehadaccesstotheinvoices.Thisaccessallowedtheemployeetochangecriticalcharacteristicsoftheinvoicetohidethetruenatureofthegoodsbeingreceived.Theinvoiceshouldhavebeendelivereddirectlytotheaccountspayableclerktoavoidcorruptingthedocument.Thereapparentlywasnoreceivingdocument（commonforsmallercompanies）;thus,onlytheinvoiceprovidedproofofwhatwasreceivedandtobepaid.Iftherehadbeenareceivingreport,theinvoicecouldnothavebeendoctoredandgoneundetected,becauseitwouldnothavematchedthereceivingreport.

NotetoInstructors:

Thisexerciseisbasedonanactualfraud.

Ex.5–4

a.Themostdifficultfraudstodetectarethosethatinvolvetheseniormanagementofacompanythatisinaconspiracytocommitthefraud.Theseniormanagershavethepowertoaccessmanypartsoftheaccountingsystem,whilethenormalseparationofdutiesissubvertedbyinvolvingmanypeopleinthefraud.Inaddition,theauthorizationcontrolissubvertedbecausemostoftheauthorizationpowerresidesintheseniormanagement.

b.Overall,thistypeoffraudcanbestoppedifthereisstrongoversightofseniormanagement,suchasanauditcommitteeoftheboardofdirectors.Individual“whistleblowers”inthecompanycanmaketheirconcernsknowntotheindependentorinternalauditorswho,inturn,caninformtheauditcommittee.Theauditcommitteeshouldbeindependentofmanagementandhavethepowertomonitortheactionsofmanagement.

Ex.5–5

1.Generalledgeraccounts:

（e）；2.Subsidiaryledgeraccounts:

（a）,（b）,（c）,（d）

Ex.5–6

a.Cashreceiptsjournal；b.Cashreceiptsjournal；c.Generaljournal（notarevenuetransaction）

d.Generaljournal；e.Cashreceiptsjournal；f.Cashreceiptsjournal

g.Cashreceiptsjournal；h.Revenuejournal；i.Cashreceiptsjournal；j.Generaljournal

Ex.5–7

a.Cashpaymentsjournal；b.P