Home Depot Kenya ltd employees use a time clock in an unsupervised area to record theirtime on the job. The time-keeping clerk tries to monitor the process, but is often distracted by other duties. Every Friday, the shop foremen collect the time cards for their subordinates, review and approve them, and deliver them to the payroll clerk.The payroll clerk uses a stand-alone PC to record the employee earnings in the employeerecords and print a hard-copy payroll register. The payroll clerk sends one copy of the payrollregister to the accounting department. The clerk then files the time cards and a copy of thepayroll register in the payroll department.The accounting department clerk receives the payroll register, reviews it for accuracy, anduses the department computer to record the transaction by posting to subsidiary and generalledger accounts including wages expense, cash, and various withholding accounts. The clerkthen prints the hard-copy checks, which are written on the general cash account. The clerksigns the paychecks and sends them to the foremen who distribute them to the employees.Finally, the clerk files the payroll register in the department.Required;i) Identify any two internal control weaknesses in the payroll transaction cycle for Home Depot Kenya ltd and provide recommendations on how these weaknesses would be addressed. ii) Explain how you would calculate the net pay for an employee of HomeDepot Kenya ltd who is employed as a full-time employee earning a gross salary of150,000 per month
Home Depot Kenya ltd employees use a time clock in an unsupervised area to record their
time on the job. The time-keeping clerk tries to monitor the process, but is often distracted by other duties. Every Friday, the shop foremen collect the time cards for their subordinates, review and approve them, and deliver them to the payroll clerk.
The payroll clerk uses a stand-alone PC to record the employee earnings in the employee
records and print a hard-copy payroll register. The payroll clerk sends one copy of the payroll
register to the accounting department. The clerk then files the time cards and a copy of the
payroll register in the payroll department.
The accounting department clerk receives the payroll register, reviews it for accuracy, and
uses the department computer to record the transaction by posting to subsidiary and general
ledger accounts including wages expense, cash, and various withholding accounts. The clerk
then prints the hard-copy checks, which are written on the general cash account. The clerk
signs the paychecks and sends them to the foremen who distribute them to the employees.
Finally, the clerk files the payroll register in the department.
Required;
i) Identify any two internal control weaknesses in the payroll transaction cycle for Home Depot Kenya ltd and provide recommendations on how these weaknesses would be addressed.
ii) Explain how you would calculate the net pay for an employee of Home
Depot Kenya ltd who is employed as a full-time employee earning a gross salary of
150,000 per month
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