Question 1

A document typically encountered in the revenue cycle that is both an output document and a source document is the

Accepted Answer

A) sales invoice. 
B) customer purchase order. 
C) sales order. 
D) packing slip. 
A) sales invoice. 
B) customer purchase order. 
C) sales order. 
D) packing slip.

Question 2

A monthly statement sent to customers serves a control purpose by

Accepted Answer

A) providing an opportunity for customers to verify the balance owed and activity on the account. 
B) triggering the process to record a customer payment. 
C) summarizing invoices and amounts due for customers. 
D) reminding customers of the balance due and due date. 
A) providing an opportunity for customers to verify the balance owed and activity on the account. 
B) triggering the process to record a customer payment. 
C) summarizing invoices and amounts due for customers. 
D) reminding customers of the balance due and due date.

Question 3

The ________ normally triggers the billing process in the revenue cycle.

Accepted Answer

A) sales order received from the sales department 
B) picking ticket received from the sales department 
C) packing slip received from the shipping department 
D) journal voucher received from the shipping department 
A) sales order received from the sales department 
B) picking ticket received from the sales department 
C) packing slip received from the shipping department 
D) journal voucher received from the shipping department

Question 4

How is credit approval generally handled for established customers with a documented payment history?

Accepted Answer

A) A new credit application is requested. 
B) General authorization by a sales clerk 
C) Specific authorization by the credit manager 
D) A formal credit check should be made for each sale. 
A) A new credit application is requested. 
B) General authorization by a sales clerk 
C) Specific authorization by the credit manager 
D) A formal credit check should be made for each sale.

Question 5

Which of the following is not one of the controls when customer payments are commingled with other mail?

Accepted Answer

A) preparing a remittance list as mail is opened 
B) restrictively endorsing checks when received 
C) requiring two mail room clerks to open mail together 
D) requiring the controller to be personally present when mail is received and opened 
A) preparing a remittance list as mail is opened 
B) restrictively endorsing checks when received 
C) requiring two mail room clerks to open mail together 
D) requiring the controller to be personally present when mail is received and opened

Question 6

An ________ is an arrangement where a bank receives customer payments and transmits payment data to the organization.

Accepted Answer

A) e-commerce 
B) electronic funds transfer (EFT) 
C) electronic lockbox 
D) electronic data interchange (EDI) 
A) e-commerce 
B) electronic funds transfer (EFT) 
C) electronic lockbox 
D) electronic data interchange (EDI)

Question 7

When a proper segregation of duties exists in the area of handling cash receipts,the ________,who reports to the ________,actually handles the cash and is not the same person who posts cash receipts to customer accounts.

Accepted Answer

A) cashier;treasurer 
B) cashier;controller 
C) accountant;treasurer 
D) accountant;controller 
A) cashier;treasurer 
B) cashier;controller 
C) accountant;treasurer 
D) accountant;controller

Question 8

Which of the following is not a key decision that needs to be made in the revenue cycle?

Accepted Answer

A) How should merchandise be delivered to customers? 
B) Should credit be extended to customers? 
C) How can customer payments be processed to maximize cash flow? 
D) Which vendor should inventory be purchased from? 
A) How should merchandise be delivered to customers? 
B) Should credit be extended to customers? 
C) How can customer payments be processed to maximize cash flow? 
D) Which vendor should inventory be purchased from?

Question 9

An accounts receivable aging report is useful for doing everything except

Accepted Answer

A) estimating bad debts. 
B) estimating future sales. 
C) projecting the timing of future cash flows. 
D) deciding whether to increase a specific customer's credit limit. 
A) estimating bad debts. 
B) estimating future sales. 
C) projecting the timing of future cash flows. 
D) deciding whether to increase a specific customer's credit limit.

Question 10

Explain how to effectively segregate duties in the sales order activity.

Accepted Answer

Sales orders should be recorded by sales

Question 11

Suppose management wanted to increase the speed of processing customer payments.One way to speed up payment transaction processing is to

Accepted Answer

A) use a FEDI. 
B) use JEDI analysis software. 
C) eliminate credit sales. 
D) extend the amount of credit offered to customers. 
A) use a FEDI. 
B) use JEDI analysis software. 
C) eliminate credit sales. 
D) extend the amount of credit offered to customers.

Question 12

The best solution for maintaining accurate automated perpetual inventory system is to use

Accepted Answer

A) closed-loop verification when inventory is received from vendors and recorded. 
B) point of sale devices integrated with inventory records. 
C) periodic physical counts to reconcile with perpetual inventory records. 
D) RFID tags. 
A) closed-loop verification when inventory is received from vendors and recorded. 
B) point of sale devices integrated with inventory records. 
C) periodic physical counts to reconcile with perpetual inventory records. 
D) RFID tags.

Question 13

What is image processing technology and how can it help companies improve the efficiency and effectiveness of managing their customer accounts?

Accepted Answer

Image processing technology can further

Question 14

A method for tracking accounts receivable that matches specific invoices and payments from the customer is called a(n)________ method.

Accepted Answer

A) specific identification 
B) balance forward 
C) cycle billing 
D) open-invoice 
A) specific identification 
B) balance forward 
C) cycle billing 
D) open-invoice

Question 15

A serious exposure in the revenue cycle is loss of assets.What is the related threat and applicable control procedure that address this exposure?

Accepted Answer

A) shipping errors;reconciliation of sales order with picking ticket and packing slip 
B) theft of cash;segregation of duties and minimization of cash handling 
C) making sales that turn out to be uncollectible;force sales people to make collection calls on customers with past due balances 
D) poor performance;preparation and review of performance reports 
A) shipping errors;reconciliation of sales order with picking ticket and packing slip 
B) theft of cash;segregation of duties and minimization of cash handling 
C) making sales that turn out to be uncollectible;force sales people to make collection calls on customers with past due balances 
D) poor performance;preparation and review of performance reports

Question 16

What is QR codes and can companies use them to improve interactions with their customers?

Accepted Answer

QR codes are two-dimensional bar codes t

Question 17

The ________ should always be included with a merchandise shipment to a customer.

Accepted Answer

A) picking ticket 
B) packing slip 
C) sales invoice 
D) remittance advice 
A) picking ticket 
B) packing slip 
C) sales invoice 
D) remittance advice

Question 18

The shipping department at Eka Toys follows policies that determine which carrier will deliver orders according to the size,weight,and destination of the shipment.It maintains standing agreements with shippers that specify legal responsibility for the shipment while it is in transit.The terms of the shipping agreements are documented on

Accepted Answer

A) picking tickets. 
B) packing slips. 
C) bills of lading. 
D) RFID tags. 
A) picking tickets. 
B) packing slips. 
C) bills of lading. 
D) RFID tags.

Question 19

A(n)________ system prepares and mails monthly statements to customers throughout the entire month,instead of just at the end of the month.

Accepted Answer

A) continuous 
B) open-invoice 
C) cycle billing 
D) balance forward 
A) continuous 
B) open-invoice 
C) cycle billing 
D) balance forward

Question 20

Describe the basic revenue cycle activities.

Accepted Answer

The revenue cycle is a recurring set of

Exam 12: The Revenue Cycle: Sales to Cash Collections

A document typically encountered in the revenue cycle that is both an output document and a source document is the

A monthly statement sent to customers serves a control purpose by

The ________ normally triggers the billing process in the revenue cycle.

How is credit approval generally handled for established customers with a documented payment history?

Which of the following is not one of the controls when customer payments are commingled with other mail?

An ________ is an arrangement where a bank receives customer payments and transmits payment data to the organization.

When a proper segregation of duties exists in the area of handling cash receipts,the ________,who reports to the ________,actually handles the cash and is not the same person who posts cash receipts to customer accounts.

Which of the following is not a key decision that needs to be made in the revenue cycle?

An accounts receivable aging report is useful for doing everything except

Explain how to effectively segregate duties in the sales order activity.

Suppose management wanted to increase the speed of processing customer payments.One way to speed up payment transaction processing is to

The best solution for maintaining accurate automated perpetual inventory system is to use

What is image processing technology and how can it help companies improve the efficiency and effectiveness of managing their customer accounts?

A method for tracking accounts receivable that matches specific invoices and payments from the customer is called a(n)________ method.

A serious exposure in the revenue cycle is loss of assets.What is the related threat and applicable control procedure that address this exposure?

What is QR codes and can companies use them to improve interactions with their customers?

The ________ should always be included with a merchandise shipment to a customer.

A(n)________ system prepares and mails monthly statements to customers throughout the entire month,instead of just at the end of the month.

Describe the basic revenue cycle activities.

Conceptual Foundations of Accounting Information Systems

Overview of Transaction Processing and Enterprise Resource Planning Systems

Systems Documentation Techniques

Relational Databases

Computer Fraud

Computer Fraud and Abuse Techniques

Control and Accounting Information Systems

Controls for Information Security

Confidentiality and Privacy Controls

Processing Integrity and Availability Controls

Auditing Computer-Based Information Systems

The Expenditure Cycle: Purchasing to Cash Disbursements

The Production Cycle

The Human Resources Management and Payroll Cycle

General Ledger and Reporting System

Database Design Using the Rea Data Model

Implementing an Rea Model in a Relational Database

Special Topics in Rea Modeling

Introduction to Systems Development and Systems Analysis

Ais Development Strategies

Systems Design, implementation, and Operation

Filters

When a proper segregation of duties exists in the area of handling cash receipts,the ,who reports to the ,actually handles the cash and is not the same person who posts cash receipts to customer accounts.