Deck 13: The Accounts Payablecash Disbursements Apcd Process

Question 1

The cash disbursements event data shows, in alphabetical order, the details of each cash payment made.

Answer 1

False

Question 2

The vendor invoice master data is a repository of all unpaid vendor invoices.

Answer 2

False

Question 3

The purchase order triggers the make payment process.

Answer 3

False

Question 4

The AP/CD process is an interacting structure of people, equipment, activities, and controls that is designed to accomplish the handling of repetitive work routines of the AP department and the cashier, support their decision needs, and assist in the preparation of internal and external reports.

Question 5

Within the make payment process, the three sub-processes are "Prepare proposed payments," "Select and record payments," and "Issue and record disbursements."

Question 6

In a relational table for PURCHASE_RECEIPTS, the primary key would be the receipt number (Rec_No).

Question 7

The cashier is responsible for processing vendor invoices, preparing payment vouchers, and recording purchase and disbursement transactions.

Question 8

The Level 0 diagram of the AP/CD Process contains the two process bubbles depicting the two major logical steps in the process: Establish payable and Approve checks.

Question 9

A disbursement voucher is designed to reflect formal approval of the voucher for payment and to provide such added data as the account distribution and the amounts to be debited.

Question 10

When the vendor payment is made, the general ledger is updated for the cash disbursement.

Question 11

The vendor sends a confirmation to establish the payable.

Question 12

In the ER diagram of the AP/CD process, VALID_INVOICES are received from the purchasing department.

Question 13

A true voucher system requires that all expenditures for whatever purpose and in excess of a certain dollar amount be formally approved for payment before they can be paid.

Question 14

The vendor invoice triggers the "establish payable" process.

Question 15

The notification of an obligation to pay a vendor for merchandise that was ordered and received is known as a purchase order.

Question 16

The cashier usually reports to the controller.

Question 17

The VP of finance usually has the cashier and the controller directly reporting to him (her).

Question 18

In the ER diagram for AP/CD process, CASH_DISBURSEMENTS are prepared by EMPLOYEES (Treasury Employees).

Question 19

The trigger for either a true voucher process or a nonvoucher process is a payment request.

Question 20

When it is time to make a payment, an approved voucher is sent to the accounts payable department.

Question 21

Purchase returns and allowances usually occur at the point of inspecting and counting the goods or at the point of validating vendor invoices.

Question 22

Independent authorization to make payment ensures that only authorized purchases are made.

Question 23

Independent validation of vendor invoices helps ensure that appropriate cash discounts are obtained.

Question 24

The cash disbursements process uses disbursement vouchers as inputs to update the accounts payable master data.

Question 25

Which of the following process bubbles would you not expect to see in the logical DFD for an AP/CD process?

A) requisition inventory
B) establish payable
C) make payment
D) all of these are process bubbles

Question 26

Chapter 13 describes the electronic invoicing and payment (EIPP) system for the B2C environment.

Question 27

Which of the following is least likely to report (either directly or indirectly) to the vice president of finance?

A) controller
B) treasurer
C) shipping department supervisor
D) accounts payable department

Question 28

The electronic invoicing and payment (EIPP) system for the B2B environment is similar to the electronic bill presentment and payment (EBPP) system for the B2C environment.

Question 29

Fraud abuses in the AP/CD process usually entail creating phony customers or submitting fictitious purchase orders.

Question 30

The "three-way match" matches the invoice with the purchase order and disbursement voucher.

Question 31

In the flowchart for the AP/DC process the symbol below represents the enterprise database.

Question 32

In a relational table for VALID_INVOICES, the primary key would be the vendor number.

Question 33

A key control in the AP/CD process is to segregate the treasurer and controller.

Question 34

Evaluated receipt settlement (ERS) is a process by which an organization pays for a purchase on the basis of the goods receipt.

Question 35

Spear phishing is a type of phishing attack that is sent to a wide variety of persons. The e-mail appears to be coming from an individual or organization that the recipient recognizes and from whom they normally receive e-mails.

Question 36

The typical AP/CD process would capture and record data related to the day-to-day operations of all of the following departments except:

A) shipping
B) cashier
C) receiving
D) activities for all of the above are captured and recorded by the AP/CD process.

Question 37

The duties of the cashier are segregated from the treasurer to protect the cash resource.

Question 38

The typical horizontal flows of information in an accounts payable/cash disbursements process might include all of the following except:

A) an invoice is received from a vendor
B) the paid voucher is returned to the accounts payable department
C) an approved disbursement voucher is sent to the cashier
D) a copy of a receiving report is sent to the cashier

Question 39

It is difficult to independently validate the vendor invoice if we do not segregate purchasing, receiving, and accounts payable.

Question 40

Which of the following managers is most likely to report to the controller?

A) accounts payable department manager
B) cashier
C) purchasing department manager
D) receiving department manager

Question 41

Which of the following activities would not occur when an inventory manager decides to return merchandise to a vendor?

A) the accounts payable department is notified
B) a credit memorandum is issued to the vendor
C) the warehouse is instructed to release the merchandise to the shipping department
D) a debit memorandum is prepared

Question 42

At the time that an AP/CD process makes payment for goods or services, the process generally follows which order."

A) select and record payments, prepare proposed payments, issue and record disbursements
B) prepare proposed payments, issue and record disbursements, select and record payments
C) issue and record disbursements, select and record payments, prepare proposed payments
D) prepare proposed payments, select and record payments, issue and record disbursements

Question 43

In the Level 0 DFD for an AP/CD, a data flow called "receiving report" most likely would be sent by the purchasing process to which of the following processes?

A) order inventory
B) receive goods and services
C) establish payable
D) make payment

Question 44

Who usually authorizes a payment?

A) the controller
B) the purchasing manager
C) a purchasing agent
D) the treasurer

Question 45

When the AP/CD process records a payable obligation, the data flow between "validate invoice" and "record payable" is?

A) GL payable update
B) AP notification
C) validated vendor invoice
D) receiving report

Question 46

In the Level 0 DFD for an AP/CD process, a data flow called "vendor invoice" most likely would be sent by the vendor to which of the following processes?

A) establish payable
B) make payment
C) order inventory
D) none of the above

Question 47

Data flows of an AP/CD process normally might include all of the following except:

A) PO accounts payable notification
B) sales report
C) receiving report
D) vendor invoice

Question 48

Which of the following is designed to reflect the formal approval of the voucher for payment?

A) a vendor invoice
B) an RFQ
C) a payment voucher
D) a disbursement voucher

Question 49

Payments not typically supported by invoices include:

A) payroll
B) income taxes
C) investments
D) all of the above

Question 50

Information for evaluating vendor performance normally would reside on the:

A) accounts payable master data
B) vendor master data
C) vouchers payable master data
D) purchase order master data

Question 51

The document one business sends to another business that identifies the amount to be paid is:

A) check
B) purchase requisition
C) vendor invoice
D) disbursement voucher

Question 52

In a typical, efficient AP/CD process, you would expect that "validating" a vendor invoice might include all of the following steps except:

A) having a copy of the invoice approved by the purchasing manager
B) comparing the invoice with a copy of the purchase order
C) comparing the invoice with a copy of the receiving report
D) checking the invoice for mathematical accuracy

Question 53

Which document typically notifies the purchaser of his or her obligation to pay?

A) vendor packing slip
B) receiving report
C) acceptance report
D) vendor invoice

Question 54

An exception routine is usually performed for:

A) processing payments
B) vendor invoice identification
C) purchase returns and allowances
D) general ledger updates

Question 55

In an AP/CD process "establish payable" would normally be triggered by:

A) vendor invoice
B) a purchase order
C) a copy of the purchase order sent to the inventory process
D) a vendor acknowledgement

Question 56

In an AP/CD process, a process "make payment" normally would be triggered by the data flow:

A) purchase order
B) vendor acknowledgement
C) vendor packing slip
D) payment due date information

Question 57

In a voucher system, the data flow between the originating department and the process "prepare disbursement voucher" typically is:

A) the disbursement voucher
B) the payment notification
C) the payment request
D) the check

Question 58

Which of the following statements regarding evaluated receipt settlement (ERS) is false?

A) ERS is a system by which an organization pays for a purchase on the basis of the goods receipt.
B) ERS can reduce the costs associated with entering invoices, matching the invoice with the PO and receiving report, and resolving discrepancies between the invoice and the PO and goods receipt.
C) ERS arrangements are only made with vendors who have proven e-payment records.
D) Upon receipt of the goods, the AP/CD system compares the received quantity to the open purchase quantity and, if appropriate, makes a payment based on the price and terms on the PO.

Question 59

Which disbursement system most easily facilitates paying a number of invoices with a single check?

A) nonvoucher system
B) voucher system
C) balance-forward system
D) open-items system

Question 60

Which of the following documents would be matched with the vendor invoice to ensure that the purchase was authorized (i.e., to ensure input validity)?

A) receiving report
B) acceptance report
C) purchase order
D) vendor packing slip

Question 61

Which of the following statements regarding e-payment technologies is true?

A) an advantage to the payer is that float is eliminated
B) the use of EDI for payments continues to decline in use
C) e-payments are settled through the ACH network, by wire transfer, or by debit or credit card
D) the cost of paying an invoice is reduced by about 50% when using e-payments

Question 62

Which control is most likely to address the goal of input completeness?

A) agreement of run-to-run totals
B) digital signature
C) independent validation of vendor invoice
D) tickler file of open purchase orders and receiving reports

Question 63

In an entity-relationship (E-R) diagram for the accounts payable/cash disbursements process, you would expect that the words sent to would appear in the diamond showing the relationship between:

A) VENDORS and INVENTORY_RECEIPTS
B) VENDORS and VENDOR_INVOICES
C) VENDORS and CASH_DISBURSEMENTS
D) CASH_DISBURSEMENTS and INVENTORY_RECEIPTS

Question 64

An enterprise system may facilitate the AP/CD process by linking:

A) the PO and receiving report
B) the PO and invoice
C) the invoice and the related cash disbursements
D) all of the above

Question 65

The control plan tickler file of payments due, is directed primarily at which of the following control goals?

A) update completeness
B) input validity
C) input accuracy
D) input completeness

Question 66

A control plan that helps ensure the security of resources within the AP/CD process is:

A) requisition confirmation to originating department
B) approve vendor selection
C) independent validation of vendor invoice
D) independent authorization to make payment

Question 67

The ______________________________ department is responsible for processing vendor invoices, preparing disbursement vouchers, and recording purchase and disbursement transactions.

Question 68

For payment voucher input validity, which control plan uses records in the AP master data to give authorization to the cash disbursements computer program to make a payment?

A) independent validation of vendor invoices
B) match invoice, purchase order, and receiving report
C) independent authorization to make payment
D) reconcile input and output batch totals

Question 69

A control plan to ensure input accuracy in payables processing is:

A) requisition confirmation to originating department
B) match invoice, purchase order, and receiving report
C) tickler file of payments due
D) independent authorization to make payment

Question 70

In an AP/CD process, a frequent exception routine is caused by ______________________________.

Question 71

The AP application matches invoices, quantities, prices and terms when it performs the control plan:

A) independent validation of vendor invoices
B) match invoice, purchase order, and receiving report
C) independent authorization to make payment
D) reconcile input and output batch totals

Question 72

A company using a centralized database approach to data management might not maintain a relational table for ACCOUNTS PAYABLE. Rather, accounts payable balances at any point in time could be computed as the difference between the relations for which of the following continuous events?

A) PURCHASE_ORDERS and INVENTORY_RECEIPTS
B) INVENTORY and INVENTORY_RECEIPTS
C) VALID_ INVOICES and INVENTORY_RECEIPTS
D) VALID_ INVOICES and CASH_DISBURSEMENTS

Question 73

The resources for which the AP/CD process wants to ensure security typically do not include:

A) cash
B) accounts payable master data
C) accounts receivable master data
D) All of the above are included in resources for which the AP/CD process wants to ensure security.

Question 74

The AP/CD process handles the repetitive work routines of:

A) cashier
B) purchasing
C) Receiving
D) all of the above

Question 75

Frauds in the cash disbursement function:

A) are less direct and more subtle than purchasing and accounts payable frauds
B) have decreased significantly due to a decrease in the number of checks being written
C) can be decreased or prevented by using digitally signed electronic payments
D) all of the above

Question 76

The control plan independent validation of vendor invoice is directed primarily at which of the following control goals?

A) select a vendor who will provide the best quality at the lowest price by the promised delivery date
B) input validity
C) input accuracy
D) input completeness

Question 77

The notification of an obligation to pay a vendor for merchandise that was ordered and received is known as a(n) ______________________________.

Question 78

Information technology has enhanced the AP/CD process by:

A) eliminating invoices
B) eliminating paper checks
C) reducing the cost to process an invoice by up to 40%
D) all of the above

Question 79

Which of the following items is not a control plan of the AP/CD process?

A) check for authorized prices, terms, freight, and discounts
B) independent validation of vendor invoices
C) independent authorization to make payment
D) reconcile bank account

Question 80

What factor has caused an escalation of check forgeries in recent years?

A) the increased use of EDI
B) the availability of cheap color printers
C) a lack of control plans to control automated funds transfer
D) a repeal of severe civil and criminal penalties for such crimes