AIS-Chapter 12
with verified
solutions
1. According to generally accepted accounting
principles, a sale is recognized when
A.cash is received from the customer.
B.inventory is removed from the warehouse.
C.inventory becomes the legal property of the
customer.
D.a sales order is approved by sales, inventory
control, and credit departments. - answer
C.inventory becomes the legal property of the
customer.
1. Which is the best control to prevent invoicing
customers for more than the actual quantity
shipped?
,A.Use the information from the sales order to
prepare the sales invoice.
B.Use the information from the packing slip to
prepare the sales invoice.
C.Use the information from the bill of lading to
prepare the sales invoice.
D.Use the information from the picking ticket to
prepare the sales invoice. - answer B.Use the
information from the packing slip to prepare the
sales invoice.
1. A picking ticket is generated by the
A.shipping process.
B.sales order entry process.
C.packing process.
D.billing process. - answer B.sales order entry
process.
1. Matching customer account numbers and
inventory item numbers to the numbers in the
customer and inventory master files is an example
of a
A.completeness test.
B.field check.
, C.reasonableness test.
D.validity check. - answer D.validity check.
1. Which of the following is not a key decision that
needs to be made in the revenue cycle?
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? - answer D.Which vendor should inventory
be purchased from?
The document a customer returns with their
payment and that identifies the source and the
amount of the payment is called a
A.remittance advice.
B.remittance list.
C.credit memorandum.
D.debit memorandum - answer A.remittance advice
with verified
solutions
1. According to generally accepted accounting
principles, a sale is recognized when
A.cash is received from the customer.
B.inventory is removed from the warehouse.
C.inventory becomes the legal property of the
customer.
D.a sales order is approved by sales, inventory
control, and credit departments. - answer
C.inventory becomes the legal property of the
customer.
1. Which is the best control to prevent invoicing
customers for more than the actual quantity
shipped?
,A.Use the information from the sales order to
prepare the sales invoice.
B.Use the information from the packing slip to
prepare the sales invoice.
C.Use the information from the bill of lading to
prepare the sales invoice.
D.Use the information from the picking ticket to
prepare the sales invoice. - answer B.Use the
information from the packing slip to prepare the
sales invoice.
1. A picking ticket is generated by the
A.shipping process.
B.sales order entry process.
C.packing process.
D.billing process. - answer B.sales order entry
process.
1. Matching customer account numbers and
inventory item numbers to the numbers in the
customer and inventory master files is an example
of a
A.completeness test.
B.field check.
, C.reasonableness test.
D.validity check. - answer D.validity check.
1. Which of the following is not a key decision that
needs to be made in the revenue cycle?
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? - answer D.Which vendor should inventory
be purchased from?
The document a customer returns with their
payment and that identifies the source and the
amount of the payment is called a
A.remittance advice.
B.remittance list.
C.credit memorandum.
D.debit memorandum - answer A.remittance advice
