Posted: April 10th, 2016

he blue cells are for data entry. Enter text in the T cells, figures in the F cells, calculations in C cells?

PROBLEM 6-5: Internal Control

At Morris Mart Inc., all sales are on account. Mary Morris-Manning is responsible for mailing invoices to customers, recording the amount billed, opening mail, and recording the payment. Mary is very devoted to the family business and never takes off more than one or two days for a long weekend. The customers know Mary and sometimes send personal notes with their payments. Another clerk handles all aspects of accounts payable. Mary’s brother, who is president of Morris Mart, has hired an accountant to help with expansion.

1. List some problems with the current accounts receivable system.
2. What suggestions would you make to improve internal control?
3. How would you explain to Mary that she personally is not the problem

Extracted Content from Question Files:


Problem 1-2: Users of Accounting Information and Their Needs

Havre Company would like to buy a building and equipment to produce a new product line.
Information about Havre is more useful to some people involved in the project than to others.

Complete the following chart by identifying the information listed with the user’s need to know the
information. Identify the information as one of the following: a. Need to know, b. Helpful to

1. Amount of current debt, repayment schedule, and interest rate
2. Fair market value of the building
3. Condition of the roof and heating and cooling, electrical, and plumbing systems
4. Total cost of the building, improvements, and equipment to set up production
5. Expected sales from the new product, variable production costs, and related selling costs

Users of Information
Management Stockholders Banker
1. T T T
2. T T T
3. T T T
4. T T T
5. T T T
Problem 1-5: Income Statement, Statement of Retained Earnings, and Balance Sheet
General Instructions
1. The following worksheet may be used to complete the exercise/problem.
You may need to refer to your textbook for additional information.
2. The blue cells are for data entry. Enter text in the T cells, figures in the F cells, calculations in C cells

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