Exam 11: The Billingaccounts Receivablecash Receipts Barcr Process

Which of the following statements is true?

A(n) ______________________________ is a postal address, maintained by a third party-typically a bank-which is used solely for the purpose of collecting checks.

An invoice is a business document-either paper or electronic transmission-used to notify the customer of an obligation to pay the seller for merchandise which was ordered and shipped.

Digital images:

TB Figure 11.9 is the control matrix for the billing process presented in Chapter 11, but with certain items omitted. In the matrix, each omission is indicated by a box. Jumbled lists of the omitted items are as follows: Omitted Iram contral Carals columns 1. Accounts receivable master data 2. Ensure efficient employment of resaures (peaple, camputers) 3. For completed shpping notice inputs, ensure 4. Ensure 5ecurity of resdurces 5. For the accounts recervable and master data, ensure 6. Ensure effectiveness of operations Omitted Gantral Plins 7. Confirm custamer accaunts repularly d. Campare ingut shipping notices to sales arder master data 9. Independent pricing data 10. Revew shiped not billed sales arders (ticker file) 11. Independent billing authorization 12. Check for authorized prices, terms, freipht, and discounts Required: Complete TB Figure 11.9 by placing one of the numbers, 1 through 12, from the above lists into each box showing a missing item. HINT: Complete the control goal column headings first, and then use the cell entries as a guide in deciding which number (7 through 12 above) belongs in each box in the recommended control plans column.

The B/AR/CR process completes the:

The control independent billing authorization ensures that bills:

The following narrative describes a cash receipts process. The annotated systems flowchart for this cash receipts process is TB Figure 11.14 and the related control matrix is Figure TB 11.15. Narrative Description TB Figure 11.14 presents a physical description of the cash receipts process in which customer payments are received by mail. The source documents include checks and RAs. Each day, the process begins with mailroom clerks opening the mail. Immediately, the clerks endorse all checks. They assemble RAs (stubs from the customer invoice-i.e., turnaround documents) in batches and prepare batch totals. The cash receipts data-batch total and remittance details-are then entered into the computer system via a scanner with OCR. The computer edits the data as the data are entered and computes batch totals. The batched RAs are sent to the accounts receivable department for filing, and the checks are transferred to the cashier. The editing process verifies the correctness of the entered data, including customer number and so forth. By matching the input cash receipts data to the open invoice data that reside on the accounts receivable master data in the enterprise database, the process also verifies that the customer account number, invoice number, and amount due are correct and that any cash discounts taken by the customer are legitimate (i.e., they have been authorized). After the data have passed all the control checks, the cash receipts event data, accounts receivable master data, and general ledger data are updated in the enterprise database. Also, the computer generates various cash reports and prepares the deposit slip. The deposit slip is transferred to the cashier. The cashier compares the checks and the deposit slip; if they agree, all documents are sent to the bank. Required: Using the format shown for control plan P-3, write descriptions for control plans P-1, P-2, P-5, M-1 and M-3. P-3: Enter cash receipts close to where cash is received. .Effieiant employment of resouress: The direct enty of cash receipts data by mailroum persannel provides far a more efficient empldyment of resaurces because this arrangement elininates the costs a5saciated with the handling of the cash receipts data by additional entities. .Remittanes arvies input accuracy: Because mailoan persannel wauld have both the check and the RA, they wald be in aposition to carrect many ingut errars "an the spot," thereby improving ingut accuracy.

An invoice record usually contains all of the following elements except:

Which of the following process bubbles (i.e., activities) would you not expect to see in the logical DFD for a B/AR/CR process?

The accounts receivable master data is a repository of all unpaid invoices issued by an organization and awaiting final disposition.

In a pre-billing system, invoices are prepared after the goods have been shipped and the sales order notification has been matched to the shipping's billing notification.

In general, adjustments to customer balances in the accounts receivable master data will be necessary for all of the following except:

With the consolidation/aggregation method of an electronic bill presentment and payment (EBPP) system, a company's bills are posted, along with bills from other companies, to a Web site hosted by a third party. Customers then go to that site to pay bills from a number of companies.

Often times a stub is attached to the customer statement. This stub is also known as a(n) ______________________________ document.

Electric and gas utility companies typically use the ______________________________ type of accounts receivable system.

Although both the treasurer and controller functions report to the VP of Finance, for good internal control, these functions should be segregated.

The B/AR/CR process comprises three different but related processes-namely, billing, accounts receivable, and cash receipts. Which of the following would not be an operations process goal for these three processes?

A credit card system is better at reducing float time for the collector than a debit card system.

Inputs to the B/AR/CR process normally could include all of the following except: