10/3/21, 12:39 PMChapter 4 Homework (Graded) - Sueiro-Khoa Nguyenhttps://xlitemprod.pearsoncmg.com/api/v1/print/highered1/131.2.Student: Khoa Nguyen Date: 10/03/21Instructor: Alexander Sueiro Course: ACG2021 - Fall 2021 - SueiroAssignment: Chapter 4 Homework(Graded) - Sueiro1: Bank reconciliation manages . fears that a trusted employee has been stealing from the company. This employee receives cash from clients and also prepares the monthly bank reconciliation. To check up on the employee, prepares her own bank reconciliation, as follows:Camile Hembley Lucas Manufacturing HembleyHembley (Click the icon to view the bank reconciliation.)1Does it appear that the employee has stolen from the company? If so, how much? Explain your answer. Which side of the bank reconciliation shows the company's true cash balance?It appears the employee hasstolen $ 795.The adjustedbankbalance is the company's true cash balance,and thecompany's books show morecash on hand. Therefore, the books mustbeincorrect.Lucas ManufacturingBank ReconciliationJanuary 31, 2018BankBooksBalance, January 314,100$Balance, January 314,080$Add:Add:Deposits in transit600Bank collections600Interest revenue30Less:Less:Outstanding checks(820)Service charge(35)Adjusted bank balance3,880$Adjusted book balance4,675$ sells memberships to the Symphony Association. The Association's procedure requires that prepare and give each customer a receipt for each membership sold. The receipt forms are prenumbered. is having personal financial problems, and he kept the cash received from a customer for a new membership. To hide his theft, destroyed the Association's copy of the receipt that he gave to the customer.James Cooper Atlanta CooperCooper$500CooperWhat will alert manager that something is wrong?Terry Reynolds will . This knowledge will lead to .Reynolds notice a gap in the sequence of sales receipts for the receipt that Cooper destroyedReynolds investigate what happened to the missing receipt and what happened to the related cash10/3/21, 12:39 PMChapter 4 Homework (Graded) - Sueiro-Khoa Nguyenhttps://xlitemprod.pearsoncmg.com/api/v1/print/highered2/133.Answer the following questions about internal control over cash payments:1. Payment by check results in three controls over cash. What are they?2. Suppose a purchasing agent receives the goods that she purchases and also approves payment for the goods. How could a dishonest purchasing agent cheat the company? How do companies avoid this internal control weakness?1. Payment by check results in three basic controls over cash. What are they?The three basic controls over cash that payment by check carries are , , and(1) Each check provides a record of the payment (source document)(2) Checks must be signed by an authorized official(3) Before signing the check, the official should study the evidence supporting the payment2. Suppose a purchasing agent receives the goods that she purchases and also approves payment for the goods. How could a dishonest purchasing agent cheat the company? How do companies avoid this internal control weakness?Choose the correct option that best completes this sentence.A dishonest purchasing agent could:A. Purchase goods and have them delivered to her home.B. Approve payment by the company for goods that have been used for personal gain.C. Both A and B.D. None of the above.Companies avoid this internal control weakness by separating the following duties:.purchasing goods, receiving goods, approving payments for goods10/3/21, 12:39 PMChapter 4 Homework (Graded) - Sueiro-Khoa Nguyenhttps://xlitemprod.pearsoncmg.com/api/v1/print/highered3/134.2: SituationsReview the following situations. (Click the icon to view the situations.)2Requirement1. Identify the internal control weakness in each situation. State how the person can hurt the company.a. . She can . When the goods come in, the incoming shipment, so .Chen prepares the purchase order and also receives the goodsadd some items to the purchase order and have them shipped to a location she controlsshe checksthere is no outside party to learn of her dishonestyb. has access to the , and she also prepares the . With access to the , .Frabotta cash collected cash reportcash collected and reported Frabotta can steal cash and falsify her cash report to conceal her thefta. is the purchasing agent for Industries. prepares purchase orders based on requests from division managers of the company. She faxes the purchase order to suppliers, who then ship the goods to . receives each incoming shipment and checks it for agreement with the purchase order and the related invoice. She then routes the goods to the respective division managers and sends the receiving report and the invoice to the accounting department for payment.Emily Chen Wilson ChenWilsonChenb. works as a security guard at parking in . has a master key to the cash box where customers pay for parking. Each night prepares the cash report that shows (a) the number of cars that parked on the lot and (b) the day's cash receipts. , the bookkeeper, checks 's figures by multiplying the number of cars by the parking fee per car. then deposits the cash in the bank.Chris Frabotta PARKFAST St. Louis FrabottaFrabottaHolly Van PARKFAST FrabottaVan10/3/21, 12:39 PMChapter 4 Homework (Graded) - Sueiro-Khoa Nguyenhttps://xlitemprod.pearsoncmg.com/api/v1/print/highered4/135.3: SituationsThe following situations describe two cash payment situations and two cash receipt situations. In each pair, one set of internal controls is better than the other. (Click the icon to view the situations.)3Requirement1. Evaluate the internal controls in each situation as strong or weak, and give the reason for your answer.Cash receipts:a. Auto Parts has internal controls. There is . .Samson Carpet Mill weaknot a good separation of dutiesThe same person receives cash, records the cash, and deposits the cashb. has internal controls. There is . .Liberty Dermatology Clinic strong a good separation of dutiesDifferent people receive cash, record the cash, and deposit the cashCash payments:a. has internal controls. There is . .Scott Construction strong a good separation of dutiesSupervisors request the equipment, and the home office purchases the equipmentb. , has internal controls. There is . .Remington Home Construction weaknot a good separation of dutiesSupervisors request the