Ask Experts Questions for FREE Help !
    sadkins415's Avatar
    sadkins415 Posts: 8, Reputation: 1
    New Member

    Oct 20, 2006, 06:39 PM
    Help with Internal Control
    (Internal Controls—Office Service Client) Brown Company provides the following
    Office support services for more than 100 small clients:
    1. Supplying temporary personnel
    2. Providing monthly bookkeeping services
    3. Designing and printing small brochures
    4. Copying and reproduction services
    5. Preparing tax reports
    Some clients pay for these services on a cash basis, some use 30-day charge accounts,
    And others operate on a contractual basis with quarterly payments.
    Brown’s new office manager was concerned about the effectiveness of control
    Procedures over sales and cash flow. At the manager’s request, the process was reviewed
    And the following facts were disclosed:

    a. Contracts were written by account executives and then passed to the accounts
    Receivable department, where they were filed. Contracts had a limitation (ceiling)
    On the types of services and the amount of work covered. Contracts were
    Payable quarterly in advance.

    b. Client periodic payments on contracts were identified on the contract, and a
    Payment receipt was placed in the contract file. Accounting records showed
    Credit Revenue; Debit Cash.

    c. Periodically, a clerk reviewed the contract files to determine their status.

    d. Work orders relating to contract services were placed in the contract file. Accounting
    Records showed Debit Cost of Services; Credit Cash or Accounts
    Payable or Accrued Payroll.

    e. Monthly bookkeeping services were usually paid for when the work was
    Complete. If not paid in cash, a copy of the invoice (marked “Unpaid
    $ _________ ”) was put into a cash-pending file. It was removed when cash
    Was received, and accounting records showed Debit Cash; Credit Revenue.

    f. Design and printing work was handled like bookkeeping’s work. However, a
    Design and printing order form was used to accumulate costs and compute the
    Charge to be made to the client. A copy of the order form served as a billing
    To the client and, when cash was received, as a remittance advice.

    g. Reproduction (copy) work was generally a cash transaction that was rung up
    On a cash register and balanced at the end of the day. Some reproduction work
    Was charged to open accounts. A billing form was given to the client with the
    Work, and a copy was put in an open file. It was removed when paid. In both
    Cases, when cash was received, the accounting entry was Debit Cash; Credit

    h. Tax work was handled like the bookkeeping services.

    I. Cash from cash sales was deposited daily. Cash from receipts on account or
    Quarterly payments on contracts was deposited after being matched with evidence
    Of the receivable.

    j. Bank reconciliations were performed using the deposit slips as original data for
    The deposits on the bank statements.

    k. A cash log of all cash received in the mail was maintained and used for reference
    Purposes when payment was disputed.

    l. Monthly comparisons were made of the costs and revenues of printing, design,
    Bookkeeping, and tax service. Unusual variations between revenues and costs
    Were investigated. However, the handling of deferred payments made this
    Analysis difficult.

    a. List the eight elements of poor internal control that are evident.

    b. List six elements of good internal control that are in effect.
    Wykeetna's Avatar
    Wykeetna Posts: 1, Reputation: 1
    New Member

    Oct 22, 2006, 04:58 PM
    Is GST incurred in all transactions
    sadkins415's Avatar
    sadkins415 Posts: 8, Reputation: 1
    New Member

    Oct 22, 2006, 07:18 PM
    It does not specify whether it does or not. Do you think you can help with this question? I'm desperate. LOL Thank you so much for your reply!

Not your question? Ask your question View similar questions


Question Tools Search this Question
Search this Question:

Advanced Search

Add your answer here.

Check out some similar questions!

Ping not recognized as internal or external command [ 9 Answers ]

When running cmd C:\Documents and Settings\... \ping I get the following error 'ping' is not recognized as an internal or external command. Please help me solve my problem Thanks

Internal repairs [ 1 Answers ]

I am a bookkeeper in a repair shop the employs vehicles that make road repairs. In this instance though, the vehicle needing the repair is our own. We just switched computer systems recently, and this new system requires us to create a full invoice for this kind of transaction. Prior to this,...

SM56 Motorola Internal Modem [ 4 Answers ]

I have installed a modem of unknown brand with a motorolla sm56 chip onto a windows xp computer. It refuses to work properly and comes up with the error "The Device Cannot Start (Error Code 10)". I have tried every different driver I can find for the chip but nothing makes any difference. I have...

Installing and Removing Internal Hard Drives [ 1 Answers ]

Hello everyone, it's my first time using this, I have had this problem for quite along time now, so I hope some can help me. I have two computers and one with several extrainternal hard drives with no data on there. I want to remove them and install them onto another computer. How do I do it...

View more questions Search