Greenwood Rock Company quarries and sells limestone. The company operates its own stone quarries and makes various
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About 75 percent of the customer orders come from stone masons; the rest come from building contractors. Company trucks deliver orders within a 300-mile radius. Third-party carriers are used to deliver orders farther away.
Greenwood employs 42 production workers, 12 truck drivers, 1 mechanic, an accountant, a full-time office manager, and a full-time salesperson. Homer Winston takes orders over the phone, via fax, and from the Web. When orders arrive over the phone, this process occurs:
• He prepares a written sales order.
• He sends one copy each to the customer and the production manager.
• The production manager processes the order and sends it to delivery.
• Upon delivery, the delivery manager sends a copy of the delivery slip to Homer.
• Based on the delivery slip, Homer sends an invoice to the customer.
Evaluate Greenwood’s internal controls over the sales cycle, and make suggestions for improvements in the internal controls for its sales cycle.
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Related Book For
Forensic Accounting and Fraud Examination
ISBN: 978-0078136665
2nd edition
Authors: William Hopwood, george young, Jay Leiner
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