HLA#4 – Ch02
Part I.
Categorize each of the following activities into the expenditure, conversion, or revenue cycles and identify the applicable
subsystem:
Expenditure Cycle/Payroll subsystem
preparing the weekly payroll for manufacturing personnel
Conversion Cycle/Production system subsystem
releasing raw materials for use in the manufacturing cycle
Revenue Cycle/Cash Receipts subsystem
recording the receipt of payment for goods sold
Revenue Cycle/Sales Order subsystem
recording the order placed by a customer
Expenditure Cycle/Purchases subsystem
authorizing credit
Conversion Cycle/Production system subsystem
determining the amount of raw materials to order
Expenditure Cycle/Purchases subsystem OR Conversion Cycle/Production Planning
preparing a purchase requisition to authorize ordering of raw materials
Expenditure Cycle/Purchases subsystem
preparing a receiving report
Part II.
Classify the following documents, journals, or ledgers as belonging to either the Revenue Cycle or the Expenditure Cycle:
Revenue Cycle
Expend. Cycle
Expend. Cycle
Revenue Cycle
Expend. Cycle
Expend. Cycle
Revenue Cycle
Revenue Cycle
Revenue Cycle
Revenue Cycle
Revenue Cycle
sales invoice
purchase order
cash disbursement
sales order
cash disbursements journal
accounts payable ledger
deposit slip
cash pre-list
customer check
shipping notice
stock release
Expend. Cycle vendor invoice
Expend. Cycle receiving report
Expend. Cycle payroll check
Revenue Cycle accounts receivable ledger
Revenue Cycle sales journal
BOTH inventory ledger
Revenue Cycle remittance advice
Expend. Cycle purchase requisition
BOTH packing slip
BOTH bill of lading
Revenue Cycle credit memo
HLA#4 – Ch02
Part III.
For each of the following records, indicate the appropriate related file structure: Master file, Transaction file, Reference
file, or Archive file:
Master
customer ledgers
Transaction
purchase orders
Reference
list of authorized vendors
Archive
records related to prior pay periods
Master
vendor ledgers
Transaction
hours each employee has worked during the current pay period
Reference
tax tables
Archive
sales orders that have been processed and recorded
Part IV.
Draw a flowchart that depicts the following: The Purchasing Department receives a purchase requisition from Inventory
Control. The clerk checks the approved vendor’s list to select a vendor, and prepares a 4-part purchase order. The
purchase order is distributed as follows: PO1 goes to the vendor; PO2 is filed by number (along with the purchase
requisition); PO3 goes to the Receiving Department; and PO4 is sent to Accounts Payable.
In the Receiving Department, PO3 is filed in a temporary file until the inventory arrives, along with a packing slip. A 3part receiving report is prepared. RR1 goes to Accounts Payable; RR2 goes to Purchasing where it is filed with PO2; RR3,
PO3, and the packing slip are file by number in the Receiving Department. [STOP]
A – check vendor list & prepare PO
B – prepare Rec. Report