revenue/receipts-sales

Question 1

revenue receipts cycle

Answer 1

customer’s order form (purchase order) external document

shipping docs for outbound/inbounds shipments and bill of lading (when a third party does the delivery for you)

sales invoice (billing)

customer remittance advice-to match the customer payment with the appropriate account

Question 2

revenue sales cycle in order

Answer 2

sales order received
shipping docs
sales invoice-billing
record sales transaction in sales journal
post the months sales to the general ledger

Question 3

segregation of duties applicable at the

Answer 3

employee level and

department level within the entity

Question 4

segregation of duties in the revenue receipts cycle

Answer 4

authorization
accounting
access

Question 5

controls

Answer 5

Controls (Physical controls)-computer passwords

custody of cash receipts and record keeping should be kept separate

Question 6

review performance review

Answer 6

monthly statement should be sent to all customers

related documents should be compared-sales invoice, sales order, shipping docs, customer purchase order

someone should verify cutoff. that transactions were recorded in the proper period

Question 7

edp/it information processing

Answer 7

focus on the entity’s records

all of the key docs should be renumbered and the numerical sequence should be properly accounted for

aged trial balance should be reconciled to the general ledger control account periodically