Acc 290 Week 5

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ACC 290 Week 5,

1-

The control environment is the basis of the entire control system that the organization is establishing. The control environment is the value that is placed on integrity and the knowledge that unethical activity will not be tolerated. It is management’s responsibility to express behavior and attitude that enforces this ethical behavior. The control environment affects the internal control by setting a basis of control activities that safeguard assets, enhance accounting reliability, increase

2-

The controls that should be in place to protect a merchandiser in a cash rich environment are –

Establishment of responsibility

Segregation of duties

Documentation procedures

Physical controls

Independent internal verification

3-

The Sarbanes-Oxley Act (SOX) requires that all publicly traded U.S. corporations are required to sustain a satisfactory structure of internal controls. In addition to internal controls each organization must be able to confirm their compliance by an independent outside audit. SOX came about because of public outrage to lack of corporate integrity and accounting dishonesty. Major corporations such as Enron and WorldCom were dishonestly reporting accounting figures to investors and such dishonesty led to the major losses in investor’s money. SOX requirements have improved

Assignment

BE5-1

Sales: $181,500
Cost of goods sold: $41,200
Gross profit: $38,000
Operating expenses: $17,900
Operating expenses: $8,500
Net income: $63,400
Next Problems Included as well

Financial Reporting Problem, Part II

PepsiCo is a highly known beverage distributor. The cola started in the late 1800s in a drugstore, and its original name was “Brad’s Drink.” In 1898, cola introduced “Brad’s Drink” to the market. Then, later change the name to Pepsi. It is a large company that has…...

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