Exam 5: The Expenditure Cycle Part I: Purchases and Cash Disbursements Procedures

The accounts payable clerk is responsible for updating the AP Control accounts to reflect each vendor liability.

A three way match involves a purchase order,a purchase requisition,and an invoice.

When a trading partner agreement is in place,the traditional three way match may be eliminated.

A purchasing system that employs electronic data interchange does not use a purchase order.

Which internally generated document should be compared to the supplier's invoice to verify the quantity being billed for?

What are the key authorization issues in purchasing and cash disbursements?

Permitting warehouse staff to maintain the only inventory records violates separation of duties.

Name the key tasks associated with purchases procedures.

The Soap Manufacturing Company has three employees who work in the warehouse.All of the warehouse workers are authorized to order inventory when it falls below the reorder level.The workers complete a purchase order and mail it to the supplier of their choice.The inventory is delivered directly to the warehouse.The workers send a memo to accounts payable reporting the receipt of inventory. Accounts payable compares the warehouse memo to the supplier's invoice.Accounts payable prepares a check which the treasurer signs. Describe at least five needed internal control improvements.

When a cash disbursement in payment of an accounts payable is recorded

Of the following duties,it is most important to separate

When purchasing inventory,which document usually triggers the recording of a liability?

In a firm with proper segregation of duties,adequate supervision is most critical in

The receiving department is not responsible to

Usually the open voucher payable file is organized by

Firms can expect that proper use of a valid vendor file will result in all of the following benefits except

The accounts payable department reconciles the accounts payable subsidiary ledger to the control account.

Describe an internal control procedure that would detect that a vendor overcharged for goods delivered.

What general ledger journal entries are triggered by the purchases system? From which departments do these journal entries arise?

How does a voucher payable system work? What documents are reconciled? Who prepares the voucher? How is the A/P balance determined? How does the voucher payable system improve control over cash?