Dec 22 Received merchandise: At this point you are receiving the merchandise, but you won't receive the invoice until December 23 so you will STOP after completing the receiving report. Nothing happens with the freight bill until you pay it on Dec 23.
Dec 22 Received check. Note the difference between the check amount and the invoice amount. Why might that happen?
Dec 22 Legal notification---it will be tempting to "wing it" and not use the flowchart, but you might miss two controls if you do...
Dec 23 Received goods from EWU. You will start with a receiving report because you are receiving goods...but remember these are not from a purchase, but a return, so you will take the other branch in the flowchart.
Dec 26 Received office supplies. Pay attention to your journal entry---
These are all that I am coming up with right now, but feel free to ask questions in the comments and I will reply. Happy working!!
As far as the exam goes, there will be 30 multiple choice questions (2.5 points each for 75 points) on the concepts we have covered with respect to the business processes and related internal controls--I have put a study guide on Blackboard. Sample questions:
When a company receives a check in the mail in payment of an account receivable, the journal entry is recorded in the:
a. Accounts receivable subsidiary ledger
b. General ledger
c. Cash receipts journal
d. General journal
e. Sales journal
ORWhat is the normal sequence for completing a sale on account?
a. customer purchase order, bill of lading, sales journal, invoice, general ledger
b. customer purchase order, general journal, receiving report, invoice, general ledger
c. customer purchase order, purchases journal, receiving report, vendor invoice, general ledger
d. customer purchase order, receiving report, invoice, general journal, general ledger
e. customer purchase order, bill of lading, invoice, sales journal, general ledger
After you complete the multiple choice questions, you will be given a company's flowcharts and you will inspect it for internal control weaknesses (25 points). We will spend 10 minutes on Monday on a practice flowchart so that you will know better what to expect (the file is locatd on Blackboard...the review will be more beneficial if you have attempted the exercise by yourself before class). DO NOT memorize Waren's flowcharts...remember Waren is one company and because Waren does something does not make it the "golden example". Instead, think about the normal sequencing of the business processes, the appropriate documents and what potential things could go wrong so that you can more easily identify when processes are missing potentially critical controls.
Can our financial statements be done in a spreadsheet?
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