NARRATIVE You are documenting a system of cash/charge receipts to better underst
ID: 459816 • Letter: N
Question
NARRATIVE You are documenting a system of cash/charge receipts to better understand how the company is currently running the process before it is converted to analyze its strengths and weaknesses.
Forever Young is a retail store that operates its business by accepting either cash payments or charge to the store’s credit card only (for example; Target only taking “Target credit card” as payment). Susan is trying to understand the process of cash receipts so that she can make decisions on possible changes to the system and evaluate internal controls. The process starts as follows:
At each store, the Sales Clerks receive the item to be purchased along with cash, or a scc (store credit card) from the customer. Sales clerks prepare the credit card charge slips (scc) and then all sales - cash and charge - are keyed into the cash register. At the end of the shift, the clerk forwards the scc slips to the store cashier (please ignore the handling of cash).
The store cashier batches the scc slips and sends batches to the cash receipts section to its headquarters at 4:30pm. each day.
As each sale is keyed in by the sales clerks, the company’s central computer system captures the transaction data and stores them on a disk file. Every night, the computer prints a sales report summarizing each store's transaction data. On the following morning, the sales report is sent to the cash receipts section, where the credit sales, scc, slips for each store are reconciled to the line on the sales report that totals scc sales for that store. The scc slips are then sent to data processing, where data preparation clerks enter the charges on a key to-disk unit (this is not a computer peripheral - just show a keyboard and a disk in data processing in the flowchart). At 10:00 P.M. each evening, the disk transaction file created by data preparation is sent to the computer room, where it is used to update the accounts receivable master file (also on disk). At the end of each month, the computer prepares customer statements that summarize the credit card charges, and sends the statements to the customers.
1 Instructions: Create one file in Excel with two worksheets (use a new, blank file). Name the first worksheet “Table” and create a Table of Entities and Activities. Name the second worksheet “Flowchart” and create a Document Flowchart. Upload your completed assignment to Blackboard before the deadline.
CAUTION: Flowchart styles can vary. Complete this assignment using the styles provided in class for this semester.
Explanation / Answer
Table Worksheet:
Flow chart can be created by putting above mentioned activity in a sequential manner.Can be done easily as each step has been mentioned elaboratively.
Entity Activity Customer Send item list to be purchased along with Cash or SCC Sales Clerk Endorses Item list and Cash or SCC Sales Clerk Prepare credit card charge slip Sales Clerk Enter Sales cash and charge into cash register Sales Clerk Forward SCC slips to the store Cashier Store Cashier batche SCC slips and send batches to the cash receipts section Computer Capture each sale transaction data and store them on disk file Computer Print sales report summarizing each store's transaction data Cash Receipt section credit sales, scc, slips for each store are reconciled to the line on the sales report that totals scc sales for that store Cash Receipt section Send SCC slips to data processing Data preparation clerk Enter the charges on a key to-disk unit Computer disk transaction file update accounts receivable master file Computer Prepare customer statements and send the statements to the customersRelated Questions
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