Instructions: Pair each statement with the code letter of the one best internal control principle that is related to the problem described.

Internal Control Principles:

A. Establishment of responsability

B. Segregation of duties

C. Physical, mechanical, and electronic control devices

D. Documentation procedures

E. Independent internal verification

F. Other controls

___1. The same person opens incoming mail and posts the accounts receivable subsidiary ledger.

___2. 3 people handle cash sales from the same register drawer.

___3. A clothing store is experiencing high levels of inventory shortages due to people trying on and walking out the store without paying for the merchandise.

___4. The person who is authorized to sign checks approves purchase orders for payment.

___5. Some cash payments are not recorded because checks are not renumbered.

___6. Cash shortages are not discovered because there are no daily cash counts by supervisors.

___7. The treasurer of the company has not taken a vacation for over 20 years.