Hall's Office Supplies Is a Small Store in a Rural

question 36

Multiple Choice

Hall's Office Supplies is a small store in a rural area of the United States; Ian Hall is the owner. The store also employs three purchasing agents and an accountant. While the purchasing agents handle day-to-day inventory purchases, Ian makes all large purchases (equipment, furniture and computers, for example) himself. Each purchasing agent is responsible for purchasing a specific group of inventory items; for example, one purchasing agent handles all purchases of computer-related supplies (mouse pads, compact discs) . Each purchasing agent uses his/her best judgment when deciding how much and how often to order inventory items. When inventory and other items arrive at the store, the relevant purchasing agent checks it in and puts it in the stockroom. Vendors send invoices directly to the accountant, who pays them within thirty days and reconciles the bank statement at least monthly. Ian works as a salesperson Monday through Friday from 8 a.m. to 5 p.m.;
he is assisted by two half-time sales staff. One staff person works from 8 a.m. to 12 noon, while the other works from 1 p.m. to 5 p.m. The part-time staff is in charge of keeping the shelves stocked. Hall's Office Supplies maintains a manual accounting information system, and retains copies of all documents for one year.
-Weak internal controls would allow the accountant to: (i) pay for merchandise not received, (ii) steal money from Hall's Office Supplies, (iii) steal inventory.

• A) i and ii only.
• B) ii and iii only.
• C) i and iii only.
• D) i, ii and iii.

---

Definitions:

Self-Fulfilling Prophecy

A prediction that directly or indirectly causes itself to become true, by the very terms of the prophecy itself, due to positive feedback between belief and behavior.

Virtual Teams

Groups of people who work together from different geographical locations, connected by technology such as email, videoconference, and collaborative software.

Reliable

Worthy of trust; consistently good in quality or performance; able to be depended on.

Curse Of Knowledge Effect

A cognitive bias that occurs when someone, knowing something, cannot remember or imagine not knowing it, leading to communication challenges.