The Accounts Receivable Clerk Destroys All Invoices for Sales Made

question 102

Multiple Choice

The accounts receivable clerk destroys all invoices for sales made to family and friends and does not record the sales in the accounts receivable subsidiary ledgers.The family and friends usually give the clerk cash as a "thank you." Which procedure will not prevent or detect this fraud?

• A)Send monthly statements to all customers with balances owed.
• B)Reconcile sales invoices in the billing department to the total debits to accounts receivable subsidiary ledgers.
• C)Sequentially prenumber all invoices and prepare a sequence check at the end of each day.
• D)Reconcile the accounts receivable control account to the accounts receivable subsidiary ledger.

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Definitions:

Milk

A nutrient-rich liquid food produced by the mammary glands of mammals, commonly consumed by humans.

Perfectly Competitive

Refers to a market structure where many firms sell identical products, entry and exit are easy, and no single firm can influence the market price.

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A major European multinational aerospace corporation known primarily for designing, manufacturing, and selling commercial aircraft worldwide.

Annual Sales

The total revenue a company generates from its business activities over the course of a year.