Exam 11: Acquestion Payment Process

Bert and Rocky's is a small local ice cream shop in southern California. Their acquisition/payment process would benefit least from ___ software.

A sequentially-numbered document contains the following: "Purchase twenty reams of paper from XYZ Corporation at a cost of $15/ream." The document could be:

Acquisition/payment process documents: Fill in the name of the document described in each row.

Rochelle was a new employee at CPP Corporation. To her dismay, she arrived in her office to find no furniture, no telephone and no computer. When she asked her supervisor what had happened, he said: "The purchasing department must not have processed the necessary paperwork. We'll correct the problem and get you everything you need within two working days." The supervisor then called the purchasing department manager and reviewed the data flow diagram of the process shown below. -Identify at least three errors in the data flow diagram above. Explain how you would revise the data flow diagram to eliminate the errors.

Hall's Office Supplies is a small store in a rural area of the United States; Ian Hall is the owner. The store also employs three purchasing agents and an accountant. While the purchasing agents handle day-to-day inventory purchases, Ian makes all large purchases (equipment, furniture and computers, for example) himself. Each purchasing agent is responsible for purchasing a specific group of inventory items; for example, one purchasing agent handles all purchases of computer-related supplies (mouse pads, compact discs). Each purchasing agent uses his/her best judgment when deciding how much and how often to order inventory items. When inventory and other items arrive at the store, the relevant purchasing agent checks it in and puts it in the stockroom. Vendors send invoices directly to the accountant, who pays them within thirty days and reconciles the bank statement at least monthly. Ian works as a salesperson Monday through Friday from 8 a.m. to 5 p.m.; he is assisted by two half-time sales staff. One staff person works from 8 a.m. to 12 noon, while the other works from 1 p.m. to 5 p.m. The part-time staff is in charge of keeping the shelves stocked. Hall's Office Supplies maintains a manual accounting information system, and retains copies of all documents for one year. -Adequate documentation can be an important form of internal control. Which document is missing from the store's acquisition/payment process: (i) purchase requisition, (ii) purchase order?

When properly designed and completed, which of the following steps in the acquisition/payment process promote strong internal control: (i) authorize a purchase, (ii) receive goods and services?

ACB Corporation's purchasing department sent a copy of a purchase order to the receiving department. The copy will promote strong internal control with all of the following except:

-In the partial data flow diagram above, assume symbol "C" is labeled "prepare receiving report." Symbol "E" is most likely to be labeled:

Ashok wants to design a new purchase requisition for his company. Assuming he knows how to use all of the information technologies listed below, which should he use?

Hall's Office Supplies is a small store in a rural area of the United States; Ian Hall is the owner. The store also employs three purchasing agents and an accountant. While the purchasing agents handle day-to-day inventory purchases, Ian makes all large purchases (equipment, furniture and computers, for example) himself. Each purchasing agent is responsible for purchasing a specific group of inventory items; for example, one purchasing agent handles all purchases of computer-related supplies (mouse pads, compact discs). Each purchasing agent uses his/her best judgment when deciding how much and how often to order inventory items. When inventory and other items arrive at the store, the relevant purchasing agent checks it in and puts it in the stockroom. Vendors send invoices directly to the accountant, who pays them within thirty days and reconciles the bank statement at least monthly. Ian works as a salesperson Monday through Friday from 8 a.m. to 5 p.m.; he is assisted by two half-time sales staff. One staff person works from 8 a.m. to 12 noon, while the other works from 1 p.m. to 5 p.m. The part-time staff is in charge of keeping the shelves stocked. Hall's Office Supplies maintains a manual accounting information system, and retains copies of all documents for one year. -Serially-numbered documents can be an important form of internal control. Which document(s) in the preceding scenario should be serially numbered: (i) vendor invoices, (ii) checks?

Bumble Beasley reviewed the steps in the acquisition/payment process, and then created the data flow diagram below. Analyze the diagram and respond to the questions that follow. 1. Should the DFD include any additional data stores? 2. Is the data flow diagram a Level One daagram? 3. Is the Accounting Department using document matching as a form of internal control? 4. Has Bumble included unnecessary data stores in the DFD? 5. Does the DFD include the right number of extermal entities? 6. Are the steps shown in the diagram numbered in the proper order? 7. Are the external entities in the DFD properly labeled? 8. Are the data stores properly labeled? 9. Are the data flows in the DFD properly labeled? 10. Are all steps in the acquisition/ payment process represented in the diagram? Yes No

Rochelle was a new employee at CPP Corporation. To her dismay, she arrived in her office to find no furniture, no telephone and no computer. When she asked her supervisor what had happened, he said: "The purchasing department must not have processed the necessary paperwork. We'll correct the problem and get you everything you need within two working days." The supervisor then called the purchasing department manager and reviewed the data flow diagram of the process shown below. -CPP doesn't use any form of information technology in its acquisition/payment process. Give two specific examples of how IT could make their process more effective and/or efficient.

Rochelle was a new employee at CPP Corporation. To her dismay, she arrived in her office to find no furniture, no telephone and no computer. When she asked her supervisor what had happened, he said: "The purchasing department must not have processed the necessary paperwork. We'll correct the problem and get you everything you need within two working days." The supervisor then called the purchasing department manager and reviewed the data flow diagram of the process shown below. -Suggest two internal controls CPP should implement to prevent Rochelle's problem from happening again.

The acquisition/payment process begins by:

In a well organized acquisition/payment process, the vendor handles: (i) purchase orders, (ii) invoices, (iii) checks.

A flowchart of the acquisition/payment process includes three columns: purchasing department, receiving department and accounting department. From that information, an analyst can infer: (i) the company has strong internal control, (ii) the company has adequate separation of duties.

Hall's Office Supplies is a small store in a rural area of the United States; Ian Hall is the owner. The store also employs three purchasing agents and an accountant. While the purchasing agents handle day-to-day inventory purchases, Ian makes all large purchases (equipment, furniture and computers, for example) himself. Each purchasing agent is responsible for purchasing a specific group of inventory items; for example, one purchasing agent handles all purchases of computer-related supplies (mouse pads, compact discs). Each purchasing agent uses his/her best judgment when deciding how much and how often to order inventory items. When inventory and other items arrive at the store, the relevant purchasing agent checks it in and puts it in the stockroom. Vendors send invoices directly to the accountant, who pays them within thirty days and reconciles the bank statement at least monthly. Ian works as a salesperson Monday through Friday from 8 a.m. to 5 p.m.; he is assisted by two half-time sales staff. One staff person works from 8 a.m. to 12 noon, while the other works from 1 p.m. to 5 p.m. The part-time staff is in charge of keeping the shelves stocked. Hall's Office Supplies maintains a manual accounting information system, and retains copies of all documents for one year. -A systems flowchart of the store's acquisition/payment process is least likely to include a column labeled:

Marie paid a vendor's invoice after matching it against a purchase order. Which of the following statements is most true?

Hall's Office Supplies is a small store in a rural area of the United States; Ian Hall is the owner. The store also employs three purchasing agents and an accountant. While the purchasing agents handle day-to-day inventory purchases, Ian makes all large purchases (equipment, furniture and computers, for example) himself. Each purchasing agent is responsible for purchasing a specific group of inventory items; for example, one purchasing agent handles all purchases of computer-related supplies (mouse pads, compact discs). Each purchasing agent uses his/her best judgment when deciding how much and how often to order inventory items. When inventory and other items arrive at the store, the relevant purchasing agent checks it in and puts it in the stockroom. Vendors send invoices directly to the accountant, who pays them within thirty days and reconciles the bank statement at least monthly. Ian works as a salesperson Monday through Friday from 8 a.m. to 5 p.m.; he is assisted by two half-time sales staff. One staff person works from 8 a.m. to 12 noon, while the other works from 1 p.m. to 5 p.m. The part-time staff is in charge of keeping the shelves stocked. Hall's Office Supplies maintains a manual accounting information system, and retains copies of all documents for one year. -The _____ and the _____ are in the best position to collaborate to steal inventory.