the sales process

Question 1

describe the start and end goal of the process

Answer 1

• start with customer order

- end with collection of cash

Question 2

describe the sales process

Answer 2

• receive an order
• select the good to be delivered
• prepare the good for delivery
• maintain customer records
• send invoice
• receive payments for goods/service
• forecast future sales
• accept returns

Question 3

describe the sales process objective/objectives

Answer 3

respond to customer inquiries
determine delivery method for goods
invoice customers and maintain customer accounts
collect cash

Question 4

list the inputs of the sales process

Answer 4

• sales order
• sales invoice
• remittance advise
• shipping notice
• debit/credit memoranda

Question 5

describe the sales order

Answer 5

it is an input

• it is created at the time of sale
• used to prepare the sales invoice

Question 6

describe the sales invoice

Answer 6

it is an input

• reflects the information of the sale
• eg products purchased, price and terms of payment

Question 7

describe remittance advice

Answer 7

an input

- may accompany payment

Question 8

describe shipping notice

Answer 8

it is an input

• prepared when the warehouse releases goods
• a copy is sent to accounts receivable
• copy can be included with goods

Question 9

describe debut/credit memoranda

Answer 9

it is an input

• denotes the return of damaged goods
• identifies discrepancies about the amount due

Question 10

list the outputs of the sales process

Answer 10

• financial statements
• customer billing statements
• ageing reports
• approved customer reports
• sales analysis reports
• bad debt reports
• cash receipt forecast

Question 11

describe financial statements

Answer 11

it is an output

- refers to the financial statements produced when a sale is made

Question 12

describe customer billing statements

Answer 12

it is an output

• summarizes outstanding sales invoices
• shows the total amount currently owed

Question 13

describe aging reports

Answer 13

it is an output
- organizes the accounts receivables based on how long they have been outstanding. helps identify which customers may require following up

Question 14

describe approved customer reports

Answer 14

it is an output

• shows customers approved for sales
• includes customer information eg billing address, credit limits and billing terms

Question 15

describe sales reports sales analysis reports

Answer 15

it is an output

• details the information captured be AIS
• used for decision making

Question 16

describe bad dept reports

Answer 16

it is an output

• contains information on the collection follow-up procedures
• helps manage over-due accounts

Question 17

describe cash receipts forecast

Answer 17

it is an output

- used to predict future cash flows