Jan Copeland, the owner of Jan's Perfect Presents, has delegated management of the business to Lou Major, a friend. Copeland drops by to meet customers and check up on cash receipts, but Major buys the merchandise and handles cash payments. Business has been very good lately, and cash receipts have kept pace with the apparent level of sales. However, for a year or so, the amount of cash on hand has been too low. When asked about this, Major explains that suppliers are charging more for goods than in the past. During the past year, Major has taken 2 expensive vacations, and Copeland wonders how Major can afford these trips on her $60,000 annual salary and commissions.
List at least 3 ways Major could be defrauding Copeland of cash. In each instance also identify how Copeland can determine whether Major's actions are ethical. Limit your answers to the store's cash payments. The business pays all suppliers by check (no EFTs).