AIS P4-1 Revenue Cycle

Chapter 4 The Revenue Cycle

M u l t i p l e - C h o i c e Q u e s t i o n s

1. Which document is NOT prepared by the sales

department?

Sales department

2. Which document triggers the update of the

inventory subsidiary ledger?

3. Which function should the billing department

NOT perform?

record the sales in the sales journal
send the ledger copy 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.
Pg,184

The Billing Department

The billing clerk then enters the transaction into the sales journal and distributes documents to the AR and inventory control departments.

4. When will a credit check approval most likely

require specific authorization by the credit

department?

when verifying that the current transaction does not exceed the customer’s credit limit
when verifying that the current transaction is with a valid customer
when a valid customer places a materially large order
when a valid customer returns goods
Pg,201

Authorization

In POS systems, the authorization process involves validating credit card charges and establishing that the customer is the valid user of the card.

5. Which type of control is considered a compensating control?

6. Which of the following is NOT an independent

verification control?

The shipping department verifies that the goods sent from the warehouse are correct in type and quantity.
General ledger clerks reconcile journal vouchers that were independently prepared in various departments.
The use of prenumbered sales orders.
The billing department reconciles the shipping notice with the sales invoice to ensure that customers are billed for only the quantities shipped.
Pg,181

Page updated

Google Sites

Report abuse