Homework: Internal Control and Cash for Financial Accounting
Objective
a. Describe and illustrate the objectives and elements of internal control.
b. Describe and illustrate the application of internal controls to cash.
Task
Jittery Joe has recently been hired as the manager of Loyola's Coffee, a national chain of franchised coffee shops. During his first month as store manager, Jittery encountered the following internal control situations:
1) Loyola's Coffee has one cash register. Prior to Jittery joining the coffee shop, each employee working on a shift would take a customer order, accept payment, and then prepare the order. Jittery made one employee on each shift responsible for taking orders and accepting the customer's payment. Other employees prepare the orders.
2) Since only one employee uses the cash register, that employee is responsible for counting the cash at the end of the shift and verifying that the cash in the drawer matches the amount of cash sales recorded by the cash register. Jittery expects each cashier to balance the drawer to the penny every time-no exceptions.
3) Jittery caught an employee putting a case of single-serving tea bags in her car. Not wanting to create a scene, Jittery smiled and said, "I don't think you're putting those tea bags on the right shelf. Don't they belong inside the coffee shop?" The employee returned the tea bags to the stockroom.
State whether you agree or disagree with Jittery's method of handling each situation and explain your answer.
Format your homework according to the following formatting requirements:
(1) The answer should be typed, double spaced, using Times New Roman font (size 12), with one-inch margins on all sides.
(2) The response also includes a cover page containing the title of the homework, the student's name, the course title, and the date. The cover page is not included in the required page length.
(3) Also include a reference page. The Citations and references should follow APA format. The reference page is not included in the required page length.