big Dave\'s pizza is pizza restaurant specializing in the sale of pizza by the s
ID: 2471083 • Letter: B
Question
big Dave's pizza is pizza restaurant specializing in the sale of pizza by the slice. the store employs 10 full-time and 155 part time e workers the store's weekly payroll averages $5,600 for all 25 workers Big Dave's pizza uses a personal computer to assist in preparing paychees. each week the store account collects employees time card and enter the hours worked into the payroll program. the payroll program calculates each employee's pay and prints a paycheck. next, the restaurant's owner authorizes the transfer of funds from the restaurant's regular bank account to the payroll account. for the week of June 15, the account accidentally recorded 200 hours worked instead of 40 hours for one of the full-time employees. does Big Dave's pizza have internal controls in place to catch this error? if so, how will this error be detected?
Explanation / Answer
Yes, Big Dave's pizza have internal controls in place to catch this error; thats why it got detected.
Internal control, is a process for assuring achievement of an organization's objectives in operational effectiveness and efficiency, reliable financial reporting, and compliance with laws, regulations and policies.
The main objectives of an Internal control system are Prevent, Detect and Correct.
Big Dave's pizza can also apply physical controls like they can keep a track on the full - time employees that enter into the restaurant.
General Controls like checking the payroll system and the data that is entered into it and the authenticity of the data once its entered into the system
and Application programs like introducing the upgraded payroll program.
By implementing the above internal controls Big Dave's pizza would be able to detect the errors on timely basis.
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