QUESTION 2 (15 marks) Part I The bank statement for Appleson Company indicated a balance of $16,000 on May 31, 2018. After the journals for May had been posted, the cash account had a balance of $7,350. The following information was available for preparing the monthly bank reconciliation: (i) Cash sales of $684 had been incorrectly recorded in the cash account as $648. (ii) Deposits in transit not recorded by bank, $1,000. (iii) Bank debit memorandum for service charges, $50. (iv) Bank credit memorandum for note collected by bank, $5,700. (V) Bank debit memorandum for $436 NSF (not sufficient funds) check from Peter Lee, a customer. (vi) Outstanding checks, $4,400. Required: Prepare a bank reconciliation for the month of May 2018. (11 marks) Part II Fork Company is a rapidly growing start-up business. The bookkeeper, who was hired ten months ago, left Hong Kong after the company's manager discovered that a large sum of money had disappeared over the past two months. An audit discovered that the bookkeeper had written and signed several checks made payable to his girlfriend and then recorded the checks as salaries expense. The girlfriend, who cashed the checks had never worked for the company, left Hong Kong with the bookkeeper. As a result, the company incurred an uninsured loss of $110,000. Required: Discuss which principles of internal control appear to have been ignored for the Fork Company. (4 marks)