ACC 557 Week 4 DQ1
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This 0 page Study Guide was uploaded by an elite notetaker on Wednesday November 11, 2015. The Study Guide belongs to fin571 at Kaplan University taught by in Fall 2015. Since its upload, it has received 25 views.
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Date Created: 11/11/15
ACC 557 Week 4 DQ1 quotAccounting Methodsquot Please respond to the following Analyze the risks to merchandising that a business may experience and how they might be minimized Determine if automation of accounting has had a positive or negative impact on business in general and how you arrived at that conclusion Create a corporate policy designed to minimize inventory shrinkage related to theft stocking errors shipping errors etc indicating how the policy will be enforced and procedures that may need to be implemented Merchandising is the method which the middlemen make preparations to display then sell the products to customers Les 2011 A good merchandising control enables the business to communicate effectively to their customers and also be exible to new market trends Despite its huge benefits merchandising poses several risks to the business Merchandising may create in exibility in the business The system created may be very difficult to alter in the future for instance putting a design for a unique product will prove difficult to alter if the product is no longer provided There is a risk of losing cross merchandising The competitors product is segregated hence the buyer does not have the opportunity of knowing the quality of the product as compared to other similar items To minimize the risk of in exibility the business should create a display that may accommodate a range of products Planning should also be done carefully When the products are arranged according to their logical associations cross merchandising will be promoted Automation of accounting has created a positive impact on business The use of computers has reduced the lead time required by accounting professionals to prepare financial statements and present them to shareholders and other stakeholders The overall efficiency has also been improved The information presented is also accurate and credible The great effect of computerized accounting is the ability and efficiency companies to effectively track and record business transactions Through improved timeliness accountants can prepare reports that give the directors a true picture of the current operations Computerized accounting has an efficient check and balance controls that speeds up the balancing of accounts prior preparation of financial statements Larger amounts of accounting information are also processed quickly through the computerized accounting system Inventory shrinkage occurs when the amount of physical count is different from that recorded Jeff 2011 The inventory shrinkage may be caused by pilferage stocking errors and shipping errors In order to reduce this problem I have created the following corporate policies Improving physical security in the business creating a strong internal control system and carrying out a stock take The security may be improved by installing CCTV cameras in the business premises The doorknobs of stockroom departments should be change and access granted only to authorized employees The number of security guards should be increased especially if there is rampant robbery or customer theft in that area A specific set of employees should be given the mandate to accept unfold and distribute any shipment The items received should only be compared to the order sheet and then immediately recorded in books of the business before being stored Verification should be done to invoices and purchase orders before the documents are filed There should be frequent review of a day s transactions and any other suspicious transactions A password should be given to every employ to be able to identify the people accessing the register Stocktaking should be done at least twice in a year to be able to certify if the physical count match the recorded value It is advisable to appoint an independent body from outside the company to conduct the stock take After all this is implemented the percentage of shrinkage in a year should be determined in order to know if the corporate policy is working Reference Jeff H 2011 Prevention and Reducing Inventory Shrinkage Retrieved from httpwwwpossoftwareguidecomarticlesnews91 html Les D 2011 Principles of Business Marketing Series Chicago Cengage Learning Press
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