Chapter 4 The Rev Cycle

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10 Questions - Developed by: - Developed on: - 2.473 taken

  • 1
    What department is NOT prepared by the sales department?
    Stock Release
    Packing Slip
    Bill of Lading
    Shipping Notice
  • 2
    What document triggers the update of the inventory subsidiary ledger?
    Bill of Lading
    Stock Release
    Sales Order
    Shipping Notice
  • 3
    What function should the billing department NOT perform?
    Record the sales in the sales journal
    Send the ledger cy of the sales order to accounts receivable
    Send the stock release document and the shipping notice to the billing department as proof of shipment
    Send the stock release document to inventory control
  • 4
    When will a credit check approval most likely require specific authorization by the credit department?
    When verifying that the current transaction is a valid customer
    When verifying that the current transaction does not exceed the customer's credit limit
    When a valid customer return goods
    When a valid customer places a materially large order
  • 5
    Which type of control is considered a compensating control?
    Access control
    Segregation of duties
    Accounting records
  • 6
    Which of the following is NOT an independent verification control?
    The use prenumbered sales orders
    General ledger clerks reconcile journal vouchers that were independently prepared in various departments
    The shipping department verifies that the goods were sent from the warehouse are in correct type and quantity
    The billing department reconciles the shipping notice with the sales invoice to ensure that customers are billed for only the quantities shipped
  • 7
    Which function or department below records the decrease in inventory due to sale?
    inventory control
    Billing department
    Sales department
  • 8
    Which situation indicates a weak internal control structure?
    The AR clerk authorizes the write-off of bad debts
    The inventory control clerk authorizes inventory purchases
    The AR clerk prepares customers statements every month
    The record-keeping clerk maintains both AR and AP subsidiary ledgers
  • 9
    The bill of lading is prepared by
    Shipping clerk
    Billing clerk
    Sales clerk
    Warehouse clerk
  • 10
    Which of the following functions should be segregated?
    Providing information on inventory levels and reconciling the bank statement
    Opening the mail and recording cash receipts in the journal
    Authorizing credit and determining reorder quantities
    Shipping goods and prepare the bill of lading

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