Reference no: EM132808353

Recently, while eating lunch with your family at a local cafeteria, you observe a practice that is somewhat unusual. As you reach the end of the cafeteria line, an adding machine operator asks how many persons are in your party, he then totals the food purchase on the trays for all of your family and then writes the number of persons included in the group on the adding machine tape. He hands you the tape and asks you to pay when you finish eating. Near the end of the meal, you decide you want a piece of pie and coffee so you return to the line, select your food, and again go through the line. The adding machine operator goes through the same procedures, but this time he staples the second tape to the original and returns it to you.

When you leave the cafeteria, you hand the stapled adding machine tapes to the cash register operator, who totals the two tapes, takes your money, and puts the tapes on a spindle?

Required:

Problem 1. What internal controls has the cafeteria instituted for its operations?

Problem 2. How can the manager of the cafeteria evaluate the effectiveness of the controls?

Problem 3. How do these controls differ from those used by most cafeterias?

Problem 4. What are the costs and benefits of the cafeteria's system?