The following is an excerpt from a telephone conversation between Jared Bodine, president of Hometown Supplies co., and Julie Sims, owner of Express Employment Co.

Jared: Julie, you’re going to have to do a better job of finding me a new computer programmer. That last guy was great at programming, but he didn’t have any common sense.

Julie: What do you mean? The guy had a master’s degree with straight A’s.

Jared: Yes, well, last month he developed a new financial reporting system. He said we could do away with manually preparing an end-of-period spreadsheet (work sheet) and financial statements. The computer would automatically generate our financial statements with “a push of a button.”

Julie. So what’s the big deal? Sounds to me like it would save you time and effort.

Jared: Right The balance sheet showed a minus for supplies!

Julie: Minus supplies? How can that be?

Jared: That’s what I asked,

Julie: So, what did he say?

Jared: Well, after he checked the program he said that it must be right. The minuses were greater than the pluses...

Julie: Didn’t he know that Supplies can’t have a credit balance-it must have a debit balance?

Jared: He asked me what a debit and credit were.

Julie: I see your point.

1. Comment on (a) the desirability of computerizing Hometown supplies Co.’s financial reporting system, (b) the elimination of the end-of-period spreadsheet (work sheet) in a computerized accounting system, and (c) the computer programmer’s lack of accounting knowledge.

2. Explain to the programmer why Supplies could not have a credit balance.