Chapter 5 Flashcards
(13 cards)
Procurement Cycle Steps
- Purchase Requisition
- Purchasing
- Receiving/Inspection
- Accounts Payable
- Cash Disbursements
Manual Purchases system begins in
Inventory Control when
inventory levels drop to reorder levels
When reorder level is reached
A purchase requisition (PR) is prepared and copies are sent to Purchasing and Accounts Payable (A/P)
Purchasing prepares a _______ for each vendor and sends copies to Inventory Control, A/P, and Receiving
purchase order (PO)
Upon receipt, Receiving
counts and inspects the goods.
A blind copy of the PO is used to
force workers to count the goods
After counting of goods, a _________ is prepared and copies sent to the raw materials storeroom, Purchasing, Inventory Control, and A/P.
receiving report
When A/P eventually gets the copies of PR, PO, receiving report, and supplier’s invoice, what should A/P do?
A/P reconciles these documents, posts to the purchases journal, and records the liability in the accounts payable subsidiary ledger.
First step in manual cash disbursements system?
Periodically, A/P searches the open vouchers payable file for items with payments due:
After seeing vouchers payable due, what does A/P do?
A/P sends the voucher and supporting documents to Cash Disbursements
After sending the voucher and supporting documents to cash disbursements, what should A/P do next?
A/P updates the accounts payable subsidiary ledger
Cash Disbursements, does this things
- prepares the check
- records the information in a check register (cash disbursements journal)
- returns paid vouchers to accounts payable, mails the check to the supplier
- sends a journal voucher to G/L
General Internal Controls
- Organization Controls (Segregation of duties)
- Documentation
- Asset Accountability Controls
- Management Practices
- Data Center Operation Controls
- Authorization Controls
- Access Controls
