Quiz Two Flashcards
What is the primary objective of the revenue cycle?
To provide the right product in the right place at the right time at the right price
Which of the following is not a basic activity of the revenue cycle?
Question options:
A)
Sales order entry
B)
Shipping
C)
Receiving
D)
Billing
Receiving
The activities involved in soliciting and processing customer orders within the revenue cycle are known as the ________
Sales order entry process
Retail stores could send their orders directly to the manufacturer’s sales order system in a format that would eliminate the need for data entry, using
Electronic data interchange
When a customer places an order (on account) for a certain product, what should be done before the order is checked for inventory availability?
The customer’s available credit should be checked
Because it is the most fungible of all assets, the management of cash has always been the most difficult of all control issues. The most important of cash controls is
segregation of duties
The best solution for maintaining accurate automated perpetual inventory system is to use
RFID tags
This document is a legal contract that defines responsibility for goods that are in transit
Bill of lading
Two documents usually accompany goods shipped to a customer. What are the two documents?
A packaging slip and a bill of lading
A company uses the method for tracking accounts receivable where customers pay according to individual sales invoices. This describes the ________ method
Open- invoice
The document a customer returns with their payment and that identifies the source and the amount of the payment is called a
Remittance advice
When a customer pays off the balance on an invoice, the payment is credited to the ________ file
customer master
A document typically encountered in the revenue cycle that is both an output document and a source document is the
Sales invoice
An arrangement where a bank receives customer payments through the postal system, scans the remittance advices, and transmits payment data to the business electronically is known as
An electronic lockbox
Separating the shipping and billing functions is designed to reduce the threat of
a failure to bill costumers
