Question 1

What role does each of the following departments play in the cash receipts subsystem: mail room, cash receipts, accounts receivable, and general ledger? Be complete.

Accepted Answer

The mail room receives the customer's payment-usually a check accompanied by a document called a remittance advice (which may be a copy of the invoice sent to the customer). Mail clerks separate the two, prepare a cash prelist or remittance list which lists all the payments received and sends the checks to the cashier and remittance advices to accounts receivable.
In cash receipts someone (e.g., cashier) restrictively endorses the checks and records the payments in the cash receipts journal. A deposit slip is prepared which accompanies the checks to the bank.
The accounts receivable department posts from the remittance advices to the customer accounts in the AR subsidiary ledger.
The general ledger department records cash receipts to the cash and AR control accounts based on the list from the mailroom and the summary report of posting from A/R.

Question 2

The purpose of the sales invoice is to

Accepted Answer

A)  record reduction of inventory 
B)  transfer goods from seller to shipper 
C)  bill the customer 
D)  select items from inventory for shipment 
A)  record reduction of inventory 
B)  transfer goods from seller to shipper 
C)  bill the customer 
D)  select items from inventory for shipment C

Question 3

State two specific functions or jobs that should be segregated in the cash receipts system.

Accepted Answer

cash receipts (custody) from accounts receivable (record keeping); and general ledger from accounts receivable subsidiary ledger; mail room (receiving cash) and accounts receivable subsidiary ledger

Question 4

Physical controls are imbedded in computer systems to control access to data.

Accepted Answer

A) True 
 B)False

Question 5

Which department is least likely to be involved in the revenue cycle?

Accepted Answer

A)  credit 
B)  accounts payable 
C)  billing 
D)  shipping 
A)  credit 
B)  accounts payable 
C)  billing 
D)  shipping

Question 6

For the revenue cycle, state two specific independent verifications that should be performed.

Accepted Answer

Shipping verifies that the goods sent fr

Question 7

What is the role of the shipping notice?

Accepted Answer

The shipping notice triggers the billing

Question 8

Which document triggers the revenue cycle?

Accepted Answer

A)  the sales order 
B)  the customer purchase order 
C)  the sales invoice 
D)  the journal voucher 
A)  the sales order 
B)  the customer purchase order 
C)  the sales invoice 
D)  the journal voucher

Question 9

In an integrated cash receipts system, which of the following is not a task of the mail room clerk?

Accepted Answer

A)  Prepare deposit slips 
B)  Open envelopes 
C)  Prepare remittance list 
D)  Make bank deposit 
A)  Prepare deposit slips 
B)  Open envelopes 
C)  Prepare remittance list 
D)  Make bank deposit

Question 10

What are the three rules that ensure that no single employee or department processes a transaction in its entirety?

Accepted Answer

The three rules that ensure segregation

Question 11

The adjustment to accounting records to reflect the decrease in inventory due to a sale occurs in the

Accepted Answer

A)  warehouse 
B)  shipping department 
C)  billing department 
D)  inventory control department 
A)  warehouse 
B)  shipping department 
C)  billing department 
D)  inventory control department

Question 12

A remittance advice is a form of turn-around document.

Accepted Answer

A) True 
 B)False

Question 13

If a customer submits a written purchase order, there is no need to prepare a sales order.

Accepted Answer

A) True 
 B)False

Question 14

How may an employee embezzle funds by issuing an unauthorized sales credit memo if the appropriate segregation of functions and authorization controls were not in place?

Accepted Answer

An employee who has access to incoming p

Question 15

The revenue cycle consists of

Accepted Answer

A)  one subsystem-order entry 
B)  two subsystems-sales order processing and cash receipts 
C)  two subsystems-order entry and inventory control 
D)  three subsystems-sales order processing, credit authorization, and cash receipts 
A)  one subsystem-order entry 
B)  two subsystems-sales order processing and cash receipts 
C)  two subsystems-order entry and inventory control 
D)  three subsystems-sales order processing, credit authorization, and cash receipts

Question 16

What is multilevel security?

Accepted Answer

Multilevel security employs programmed t

Question 17

Which type of control is considered a compensating control?

Accepted Answer

A)  segregation of duties 
B)  access control 
C)  supervision 
D)  accounting records 
A)  segregation of duties 
B)  access control 
C)  supervision 
D)  accounting records

Question 18

The accounts receivable clerk is responsible for updating the AR Control accounts to reflect each customer sale.

Accepted Answer

A) True 
 B)False

Question 19

Integrated accounting systems automatically transfer data between modules.

Accepted Answer

A) True 
 B)False

Question 20

The revenue cycle utilizes all of the following files except

Accepted Answer

A)  credit memo file 
B)  sales history file 
C)  shipping report file 
D)  cost data reference file 
A)  credit memo file 
B)  sales history file 
C)  shipping report file 
D)  cost data reference file

What role does each of the following departments play in the cash receipts subsystem: mail room, cash receipts, accounts receivable, and general ledger? Be complete.

The purpose of the sales invoice is to

State two specific functions or jobs that should be segregated in the cash receipts system.

Physical controls are imbedded in computer systems to control access to data.

Which department is least likely to be involved in the revenue cycle?

For the revenue cycle, state two specific independent verifications that should be performed.

What is the role of the shipping notice?

Which document triggers the revenue cycle?

In an integrated cash receipts system, which of the following is not a task of the mail room clerk?

What are the three rules that ensure that no single employee or department processes a transaction in its entirety?

The adjustment to accounting records to reflect the decrease in inventory due to a sale occurs in the

A remittance advice is a form of turn-around document.

If a customer submits a written purchase order, there is no need to prepare a sales order.

How may an employee embezzle funds by issuing an unauthorized sales credit memo if the appropriate segregation of functions and authorization controls were not in place?

The revenue cycle consists of

What is multilevel security?

Which type of control is considered a compensating control?

The accounts receivable clerk is responsible for updating the AR Control accounts to reflect each customer sale.

Integrated accounting systems automatically transfer data between modules.

The revenue cycle utilizes all of the following files except

The Information System: an Accountants Perspective

Introduction to Transaction Processing

Ethics, Fraud, and Internal Control

The Expenditure Cycle Part I: Purchases and Cash Disbursements Procedures

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 4: The Revenue Cycle

What role does each of the following departments play in the cash receipts subsystem: mail room, cash receipts, accounts receivable, and general ledger? Be complete.

The purpose of the sales invoice is to

State two specific functions or jobs that should be segregated in the cash receipts system.

Physical controls are imbedded in computer systems to control access to data.

Which department is least likely to be involved in the revenue cycle?

For the revenue cycle, state two specific independent verifications that should be performed.

What is the role of the shipping notice?

Which document triggers the revenue cycle?

In an integrated cash receipts system, which of the following is not a task of the mail room clerk?

What are the three rules that ensure that no single employee or department processes a transaction in its entirety?

The adjustment to accounting records to reflect the decrease in inventory due to a sale occurs in the

A remittance advice is a form of turn-around document.

If a customer submits a written purchase order, there is no need to prepare a sales order.

How may an employee embezzle funds by issuing an unauthorized sales credit memo if the appropriate segregation of functions and authorization controls were not in place?

The revenue cycle consists of

What is multilevel security?

Which type of control is considered a compensating control?

The accounts receivable clerk is responsible for updating the AR Control accounts to reflect each customer sale.

Integrated accounting systems automatically transfer data between modules.

The revenue cycle utilizes all of the following files except

The Information System: an Accountants Perspective

Introduction to Transaction Processing

Ethics, Fraud, and Internal Control

The Expenditure Cycle Part I: Purchases and Cash Disbursements Procedures

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