REVENUE CYCLE

Question 1

It is a regular set of business activities relating to selling goods and services to customers and collecting payments from those sale

Answer 1

Revenue cycle

Question 2

It is considered the starting point of the revenue cycle where the company receives orders from customers

Answer 2

Sales order entry

Question 3

It must occur before the goods are released from inventory and shipped to the customer

Answer 3

Credit approval

Question 4

Sales people need to determine whether sufficient inventory is available to fill the order, so that customers can be informed
of the expected delivery date.

Answer 4

Checking inventory availability

Question 5

This process consists of two (2) steps: picking and packing orders and
shipping the order.

Answer 5

Shipping

Question 6

This process consists of two (2) steps: picking and packing orders and
shipping the order.

Answer 6

Shipping

Question 7

It is an information processing activity that repackages and summarizes information from sales order entry and shipping activities

Answer 7

Invoicing

Question 8

This method, customer typically pays according to each invoice. Usually, two (2) copies of the invoice are mailed to the customer, who is requested to return one (1) copy with the payment.

Answer 8

Open invoice method

Question 9

This method, customers typically
pay according to the amount shown on a monthly statement rather than by individual invoices.

Answer 9

Balance forward method

Question 10

It is a postal address to which customers send their remittances.

Answer 10

Lockbox

Question 11

It is an another way to speed up the processing.

Answer 11

Electronic fund transfer (EFT)