Write a 700-1050 word paper that addresses the following questions (attached). Include how a company could use the five basic principles of cash management to increase accuracy for a business. Document Preview: 194 CHAPTER 4 Internal Control and Cash E4-5 At Idaho Company checks are not prenumbered because both the purchasing agent and the treasurer are authorized to issue checks. Each signer has access to unissued checks kept in an unlocked file cabinet. The purchasing agent pays all bills pertaining to goods purchased for resale. Prior to payment, the purchasing agent determines that the goods have been received and verifies the mathematical accuracy of the vendors invoice. After payment, the invoice is filed by vendor and the purchasing agent records the payment in the cash disbursements journal. The treasurer pays all other bills following approval by authorized employees. After payment, the treasurer stamps all bills paid, files them by payment date, and records the checks in the cash disbursements journal. Idaho Company maintains one checking account that is reconciled by the treasurer. Instructions (a) List the weaknesses in internal control over cash disbursements. (b) Write a memo indicating your recommendations for improving company P4-1A Guard Dog Company recently changed its system of internal control over cash disbursements. The system includes the following features. Instead of being unnumbered and manually prepared, all checks must now be prenumbered and written by using the new check writer purchased by the company. Before a check can be issued, each invoice must have the approval of Jane Bell, the purchasing agent, and Dennis Kurt, the receiving department supervisor. Checks must be signed by either Tom Kimball, the treasurer, or Karen Thews, the assistant treasurer. Before signing a check, the signer is expected to compare the amounts of the check with the amounts on the invoice. After signing a check, the signer stamps the invoice paid and inserts within the stamp, the date, check number, and amount of the check. The paid invoice is then sent to the accounting department for recording. Blank checks are stored in a safe in the Attachments: 4798-194 CHAP.doc