Question 1

What is(are) the purpose(s) of maintaining a valid vendor file?

Accepted Answer

Inventories should only be acquired from

Question 2

Explain why a three way match may not be required for transactions covered by a trading partner agreement.

Accepted Answer

Under a trading partner agreement the pa

Question 3

The purpose of the receiving report is to

Accepted Answer

A)  order goods from vendors 
B)  record receipt of goods from vendors 
C)  authorize the purchasing department to order goods 
D)  bill for goods delivered 
A)  order goods from vendors 
B)  record receipt of goods from vendors 
C)  authorize the purchasing department to order goods 
D)  bill for goods delivered

Question 4

In a merchandising firm, authorization for the payment of inventory is the responsibility of

Accepted Answer

A)  inventory control 
B)  purchasing 
C)  accounts payable 
D)  cash disbursements 
A)  inventory control 
B)  purchasing 
C)  accounts payable 
D)  cash disbursements

Question 5

The receiving report is used to

Accepted Answer

A)  accompany physical inventories to the storeroom or warehouse 
B)  advise the purchasing department of the dollar value of the goods delivered 
C)  advise general ledger of the accounting entry to be made 
D)  advise the vendor that the goods arrived safely 
A)  accompany physical inventories to the storeroom or warehouse 
B)  advise the purchasing department of the dollar value of the goods delivered 
C)  advise general ledger of the accounting entry to be made 
D)  advise the vendor that the goods arrived safely

Question 6

What is an AP packet?

Accepted Answer

The AP packet consists of the

Question 7

A copy of the purchase order (PO) is sent to the

Accepted Answer

A)  vendor 
B)  accounts payable function 
C)  receive goods function 
D)  all of the above 
A)  vendor 
B)  accounts payable function 
C)  receive goods function 
D)  all of the above

Question 8

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.
Discuss potential internal control risks inherent in this system.

Accepted Answer

Placing this much authority in the hands

Question 9

The check digit control will provide control over accessing the wrong accounts.

Accepted Answer

A) True 
 B)False

Question 10

An automated cash disbursements system can yield better cash management since payments are made on time.

Accepted Answer

A) True 
 B)False

Question 11

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

Accepted Answer

A) True 
 B)False

Question 12

Firms that wish to improve control over cash disbursements use a voucher system.

Accepted Answer

A) True 
 B)False

Question 13

Differentiate between a purchase requisition and a purchase order.

Accepted Answer

A purchase requisition is completed by t

Question 14

What is a blind copy of a purchase order and what is its purpose?

Accepted Answer

A blind copy of the PO contains no quant

Question 15

The open purchase order file in the purchasing department is used to determine

Accepted Answer

A)  the quality of items a vendor ships 
B)  the best vendor for a specific item 
C)  the orders that have not been received 
D)  the quantity of items received 
A)  the quality of items a vendor ships 
B)  the best vendor for a specific item 
C)  the orders that have not been received 
D)  the quantity of items received

Question 16

The use of inventory reorder points suggests the need to obtain proper authorization.

Accepted Answer

A) True 
 B)False

Question 17

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

Accepted Answer

A)  Purchases from unapproved vendors will be prevented. 
B)  Purchases from fictitious vendors will be detected. 
C)  The most competitive price will be obtained. 
D)  The risk of purchasing agents receiving kickbacks and bribes will be reduced. 
A)  Purchases from unapproved vendors will be prevented. 
B)  Purchases from fictitious vendors will be detected. 
C)  The most competitive price will be obtained. 
D)  The risk of purchasing agents receiving kickbacks and bribes will be reduced.

Question 18

Usually the open voucher payable file is organized by

Accepted Answer

A)  vendor 
B)  payment due date 
C)  purchase order number 
D)  transaction date 
A)  vendor 
B)  payment due date 
C)  purchase order number 
D)  transaction date

Question 19

The receiving report

Accepted Answer

A)  is used to update the actual cost inventory ledger 
B)  accompanies the goods to the storeroom 
C)  is sent to general ledger 
D)  is returned to the vendor to acknowledge receipt of the goods 
A)  is used to update the actual cost inventory ledger 
B)  accompanies the goods to the storeroom 
C)  is sent to general ledger 
D)  is returned to the vendor to acknowledge receipt of the goods

Question 20

When searching for unrecorded liabilities at the end of an accounting period, the accountant would search all of the files except

Accepted Answer

A)  the purchase requisition file 
B)  the cash receipts file 
C)  the purchase order file 
D)  the receiving report file 
A)  the purchase requisition file 
B)  the cash receipts file 
C)  the purchase order file 
D)  the receiving report file

What is(are) the purpose(s) of maintaining a valid vendor file?

Explain why a three way match may not be required for transactions covered by a trading partner agreement.

The purpose of the receiving report is to

In a merchandising firm, authorization for the payment of inventory is the responsibility of

The receiving report is used to

What is an AP packet?

A copy of the purchase order (PO) is sent to the

The check digit control will provide control over accessing the wrong accounts.

An automated cash disbursements system can yield better cash management since payments are made on time.

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

Firms that wish to improve control over cash disbursements use a voucher system.

Differentiate between a purchase requisition and a purchase order.

What is a blind copy of a purchase order and what is its purpose?

The open purchase order file in the purchasing department is used to determine

The use of inventory reorder points suggests the need to obtain proper authorization.

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

Usually the open voucher payable file is organized by

The receiving report

When searching for unrecorded liabilities at the end of an accounting period, the accountant would search all of the files except

The Information System: an Accountants Perspective

Introduction to Transaction Processing

Ethics, Fraud, and Internal Control

The Revenue Cycle

The Expenditure Cycle Part II: Payroll Processing and Fixed Asset Procedures

The Conversion Cycle

Financial Reporting, and Management Reporting Systems

Database Management Systems

The Rea Approach to Business Process Modeling

Enterprise Resource Planning Systems

Electronic Commerce Systems

Managing the Systems Development Life Cycle

Construct, Deliver, and Maintain Systems Projects

IT Controls Part I: Sarbanes-Oxley and It Governance

IT Controls Part II: Security and Access

IT Controls Part III: Systems Development, Program Changes, and Application Controls

Filters

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

What is(are) the purpose(s) of maintaining a valid vendor file?

Explain why a three way match may not be required for transactions covered by a trading partner agreement.

The purpose of the receiving report is to

In a merchandising firm, authorization for the payment of inventory is the responsibility of

The receiving report is used to

What is an AP packet?

A copy of the purchase order (PO) is sent to the

The check digit control will provide control over accessing the wrong accounts.

An automated cash disbursements system can yield better cash management since payments are made on time.

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

Firms that wish to improve control over cash disbursements use a voucher system.

Differentiate between a purchase requisition and a purchase order.

What is a blind copy of a purchase order and what is its purpose?

The open purchase order file in the purchasing department is used to determine

The use of inventory reorder points suggests the need to obtain proper authorization.

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

Usually the open voucher payable file is organized by

The receiving report

When searching for unrecorded liabilities at the end of an accounting period, the accountant would search all of the files except

The Information System: an Accountants Perspective

Introduction to Transaction Processing

Ethics, Fraud, and Internal Control

The Revenue Cycle

The Expenditure Cycle Part II: Payroll Processing and Fixed Asset Procedures

The Conversion Cycle

Financial Reporting, and Management Reporting Systems

Database Management Systems

The Rea Approach to Business Process Modeling

Enterprise Resource Planning Systems

Electronic Commerce Systems

Managing the Systems Development Life Cycle

Construct, Deliver, and Maintain Systems Projects

IT Controls Part I: Sarbanes-Oxley and It Governance

IT Controls Part II: Security and Access

IT Controls Part III: Systems Development, Program Changes, and Application Controls

Filters