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WorksheetsIT2_Final Quiz Part 2 Expenditure Cycle
Total questions: 20
Worksheet time: 13mins
Purchasing decisions are authorized by inventory control.
TRUE
FALSE
The blind copy of the purchase order that goes to the receiving department contains no item descriptions.
TRUE
FALSE
Firms that wish to improve control over cash disbursements use a voucher system
TRUE
FALSE
In a voucher system, the sum of all unpaid vouchers in the voucher register equals the firm’s total voucher payable balance.
TRUE
FALSE
The accounts payable department reconciles the accounts payable subsidiary ledger to the control account
TRUE
FALSE
The use of inventory reorder points suggests the need to obtain specific authorization
TRUE
FALSE
Proper segregation of duties requires that the responsibility approving a payment be separated from posting to the cash disbursements journal
TRUE
FALSE
A major risk exposure in the expenditure cycle is that accounts payable may be overstated at the end of the accounting year
TRUE
FALSE
A three way match involves a purchase order, a purchase requisition, and an invoice.
TRUE
FALSE
Authorization for a cash disbursement occurs in the cash disbursement department upon receipt of the supplier’s invoice.
TRUE
FALSE
The purpose of the purchase requisition is to
order goods from vendors
record receipt of goods from vendors
authorize the purchasing department to order goods
bill for goods delivered
The purpose of the receiving report is to
order goods from vendors
record receipt of goods from vendors
authorize the purchasing department to order goods
bill for goods delivered
All of the following departments have a copy of the purchase order except
the purchasing department
the receiving department
accounts payable
general ledger
The purpose of the purchase order is to
order goods from vendors
record receipt of goods from vendors
authorize the purchasing department to order goods
approve payment for goods received
The open purchase order file in the purchasing department is used to determine
the quality of items a vendor ships
the best vendor for a specific item
the orders that have not been received
the quantity of items received
The purchase order
is the source document to make an entry into the accounting records
indicates item description, quantity, and price
is prepared by the inventory control department
is approved by the end-user department
The reason that a blind copy of the purchase order is sent to receiving is to
inform receiving when a shipment is due
force a count of the items delivered
inform receiving of the type, quantity, and price of items to be delivered
require that the goods delivered are inspected
The receiving report is used to
accompany physical inventories to the storeroom or warehouse
advise the purchasing department of the dollar value of the goods delivered
advise general ledger of the accounting entry to be made
advise the vendor that the goods arrived safely
When a copy of the receiving report arrives in the purchasing department, it is used to
adjust perpetual inventory records
record the physical transfer of inventory from receiving to the warehouse
analyze the receiving department’s process
recognize the purchase order as closed
The financial value of a purchase is determined by reviewing the
packing slip
purchase requisition
receiving report
supplier’s invoice
