Exam 11: The Billingaccounts Receivable Cash Receipts Barcr Process

An organization can accelerate cash deposits and prevent lapping by _________________________.

Below is the narrative of the "Manage customer accounts" portion of the B/AR/CR process.Narrative Description Processes 2.1 through 2.3 relate to sales returns adjustments.This process begins when there is notification from the receiving department that goods have been returned by a customer.Subprocess 2.1 obtains data from the accounts receivable master data to validate the return.If the sales return is not valid, it will be rejected (see Reject stub) and processed through a separate exception routine.If the sales return is valid, it is sent to subprocess 2.2 where a credit memo is prepared and sent to the customer, and the accounts receivable master data is updated to reflect the credit.At the same time, the validated sales return is sent to subprocess 2.3 where a journal voucher is prepared, which is used to create a record in the AR adjustments event data store (i.e., the journal), and the general ledger is notified that a credit memo has been issued.This results in updates to sales returns and allowances and to AR.Process 2.4 is triggered by a periodic review of aging details obtained from the accounts receivable master data.This report would be used to identify and follow up on late-paying customer accounts.One of two types of adjustments might result from this review: -The recurring adjusting entry for estimated bad debts.-The periodic write-off of "definitely worthless" customer accounts.Like process 2.4, bubble 2.5, "Prepare customer statements," also is triggered by a periodic event that recurs at specified intervals, often on a monthly basis in practice.Details of unpaid invoices are extracted from the accounts receivable master data and are summarized in a statement of account that is mailed (or sent electronically) to customers.Required: From the DFD in TB Figure 11.5 and the narrative description above, explode bubble 2.0 into a lower-level diagram showing the details of that process by identifying the words that belong in items 1.to 15.(TB Figure 11.6).

The E-R diagram below represents a B/AR/CR process but with the names of certain entities, and relationship cardinalities removed from the diagram.In alphabetic order, the names omitted are: $\bullet$ BANKS $\bullet$ CASH_RECEIPTS $\bullet$ CUSTOMERS $\bullet$ DEPOSITS $\bullet$ INVENTORY $\bullet$ SALES_INVOICES $\bullet$ SALES_ORDERS $\bullet$ SHIPMENTS Required: Complete The E-R Diagram (TB Figure 11.12) by: a.Inserting the names from the above lists into the boxes where they belong. b.Inserting a 1 or an M or an N where necessary to indicate whether the cardinality of the relationship is: one-to-one (1:1), one-to-many (1:M), or many-to-many (M:N). TB Figure 11.12

In a balance-forward accounts receivable system, the customer statements display previous balance, payments, and balance forward to which is added any new charges to derive the total balance due.

In a B/AR/CR process, which of the following data stores is least likely to interact with a process called "perform billing"?

Placing a customer's bills on a company's own Web site and sending an e-mail telling the customer that his or her bill is there is called:

A(n) _________________________ is a form of payment authorizing the collector to transfer funds electronically from the payer's bank account to the collector's bank account.

An invoice record usually contains all of the following elements except:

A company using a centralized database approach might not maintain a relational table for ACCOUNTS RECEIVABLE.Rather, accounts receivable balances at any point in time could be computed as the difference between the relations for which of the following continuous events?

In an open-item system, accounts receivable records consist of a customer's current balance due, past-due balance, and the finance charges and payments related to the account.

In an entity-relationship (E-R) diagram for the B/AR/CR process, you would expect that the word trigger would appear between the boxes for ?

In a(n) ____________________ billing system, invoices are prepared upon acceptance of the customer order.

Below is the narrative for the "Receive payment" portion of the B/AR/CR process.Narrative Description The check and remittance advice triggers the receive payment process.Upon receipt of the check and RA from a customer, process 3.1 first validates the remittance by comparing the check to the RA.Mismatches are rejected for later processing.If the check and RA agree, the validated remittance is sent to process 3.2, which endorses the check and separates it from the RA.Process 3.3 accumulates a number of endorsed checks, prepares and sends a bank deposit to the bank, records the collection with the cash receipts events data (i.e., the cash receipts journal could be used for a periodic update of the GL for a number of cash receipts events), and notifies the general ledger process of the amount of the cash deposited.This is an immediate update of the GL for a single cash receipt.While process 3.3 is preparing the deposit (typically performed by the cashier, a treasurer function), process 3.4 uses the RA to update the accounts receivable master data to reflect the customer's payment and then files the RA in the remittance advice file.Process 3.4, which is a controller function, is typically performed by the cash applications section of the accounts receivable department.Required: From the DFD in TB Figure 11.7 and the narrative description above, explode bubble 3.0 into a lower-level diagram showing the details of that process.

A lockbox is a postal address maintained by a third party-typically a bank-which is used solely for the purpose of collecting checks.