The following procedures are used by Complete Wholesale Incorporated.a. All sales are made on account, with each sale being indicated on a sequentially numberedsales invoice.b. Customer payments are received in the mail by the office receptionist, who sends the checksto a cashier for deposit and the remittance advices to the accounting department for recordingagainst the customer’s account balance.c. The office receptionist is assigned the job of handling all customer complaints.d. When a customer has a legitimate complaint about goods sold to the customer on account, thereceptionist will phone the accounting department to request that the customer’s account becredited for the sales allowance.e. The company’s inventory is stored in a locked warehouse that is monitored by surveillancecameras.f. Payments to the company’s suppliers are made only after the supplier’s invoice is received andcompared to the receiving report.Required:1. Indicate whether each procedure represents a strength or weakness. Explain your reasons.2. For each weakness, describe a change in procedures that would address the weakness.
The following procedures are used by Complete Wholesale Incorporated.
a. All sales are made on account, with each sale being indicated on a sequentially numbered
sales invoice.
b. Customer payments are received in the mail by the office receptionist, who sends the checks
to a cashier for deposit and the remittance advices to the accounting department for recording
against the customer’s account balance.
c. The office receptionist is assigned the job of handling all customer complaints.
d. When a customer has a legitimate complaint about goods sold to the customer on account, the
receptionist will phone the accounting department to request that the customer’s account be
credited for the sales allowance.
e. The company’s inventory is stored in a locked warehouse that is monitored by surveillance
cameras.
f. Payments to the company’s suppliers are made only after the supplier’s invoice is received and
compared to the receiving report.
Required:
1. Indicate whether each procedure represents a strength or weakness. Explain your reasons.
2. For each weakness, describe a change in procedures that would address the weakness.
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