Question 1: What is “The additional cost required to establish separate departments for warehousing, shipping and inventory control is considered a necessary cost for the added benefit of control over inventory.” Discuss this statement in the light of existing revenue cycle of RCE Limited. please find the document attached for more info. The Revenue Cycle of RCE Limited. RCE Limited is a Queensland based wholeseller that deals in theupdate the accounts receivable subsidiary ledger and general ledger from his computer terminal.rafting and camping equipment. In particular, RCE Limited serves outdoor sports camping retailersAfter the records are updated, the clerk files the stock release and shipping notice in the accountsthroughout the Queensland. Mr. Chris Doubler has recently joined the accounting department ofreceivable department. Sometimes, the account receivable clerk reconciles the quantities from theRCE Limited as a head of the department. Mr. Doubler gathered a wide range of data from hissales order and adjusts the account receivables. Cash Receipt Procedures of RCE Limited Thedeparment using different sources to improve the operations of his departmetn. After analysing thisdata, Mr. Doubler is concerned about the revenue cycle of RCE Limited. You are running anpayments of customers come directly to the general mailroom along with other mail items. The mailclerk performs the different tasks, including (1) sorting the mail, (2) opening the customer paymentaccounting consultancy and considered as the best consultant on the accounting informationenvelope, (3) removing the customer's check and remittance advice, and (4) reconciling these twosystem. Therefore, Mr. Doubler approached you to evaluate their revenue cycle. During the initialdocuments. To control the checks and remittance advices, the clerk manually prepares two hardmeeting, you suspect that the business activities and related data processing operations of thecopies of a remittance list. He sends one copy to the accounts receivable department, along with therevenue cycle of RCE Limited might not closely associated with providing goods and services tocustomers and collecting their cash payments. You further elaborated that the revenue cycle can becorresponding remittance advices. The other copy of the remittance list accompanies the checks tothe cash receipts department. Once the checks and remittance list arrive in the cash receiptscategorised into (1) sales order processing procedures (SOPP), and (2) cash receipts proceduresdepartment, the treasurer performs the following tasks: (1) reconciles the documents, (2) endorses(CRP). Consequently, you requested the head of the accounting department to describe the SOPPthe checks, (3) manually prepares three hard copies of a deposit slip, (4) updates the cash receiptsand the CRP of RCE Limited separately. This description is given below. Sales Order Procedures ofjournal and the general ledger from his computer terminal, (5) sends the checks and two copies ofRCE Limited The sales department encourages its customers to forward the orders in any form,the deposit slip to the bank, and (6) files the third copy of the deposit slip and the remittance in theincluding mail, e-mail or fax. The sales clerk first converts these sales order into the standardiseddepartment. HI5019 T1 2021 Assessment 1: Individual Assignment Page 4 of 9 The accountssales order. For this purpose, the sales representative requests the missing information, if any. (Inreceivable clerk receives the remittance list and remittance advice from the mailroom and reconcilesthe light of our discussion during the Interactive Tutorials, please mention this missing information.)these two documents. He then updates the accounts receivable subsidiary ledger and the generalledger. Then, account receivable files the two documents in the department.When the order is received, the sales clerk checks the customer's creditworthiness of the customerfrom his computer terminal. Sales clerk thinsk that checking the accounting record is not technicaland he can perform these duties efficiently. Two years ago, the sales clerk requested the accountingdepartment to provide him with a list of customers whose account receivables are written off. Thesales clerk is still using this information to check the creditworthiness of the customers. The salesclerk did not differentiate the new customers from the existing customers and he is using the sameHIS019 T1 2021 Assessment 1: Individual Assignment Page 3 of 9 procedure to check thecreditworthiness of the new customers. The customer's order is rejected if the customer's credit isnot verified. The sales order processing is started after the credit verification. In particular, the salesclerk records the approved standardised sales order in the sales order system through his computerterminal. A digital copy of the order is distributed to the warehouse and the shipping departmentterminals for further processing. The computer system automatically records the sale in the salesjournal. The clerk files the hard copy of the customer order in the sales department withoutreviewing the entry. Then, the receipt of the digital sales order prompts on the computer terminal ofthe warehouse manager. This digital sales order has the associated stock release and the shippingnotice. These documents play an important role in the transition processing system. The warehousemanager has access to these documents. For further processing, the warehouse manager prints outthe sales order, the stock release, and the shipping notice. Using the stock release copy, awarehouse clerk picks the selected items from the shelves and sends them to the shippingdepartment along with the stock release and the shipping notice. The warehouse manager thenupdates the inventory subsidiary ledger and the general ledger control account from his computerterminal. The shipping clerk receives the physical stock, the stock release, and the shipping noticefrom the warehouse manager. The shipping clerk matches them to the corresponding digital salesorder displayed on his terminal. If everything matches, he prints out three hard copies of the bill oflading and a packing slip. The shipping clerk sends two copies of the bill of lading and the packingslip, along with the goods, to the carrier. The stock release copy and the shipping notice are sent tothe accounts receivable department. The third bill of lading copy is filed in the shipping department.Account receivable clerk receives the stock release and shipping notice from the shipping clerk.Then, the accounts receivable clerk manually creates a hardcopy invoice, which is immediatelymailed to the customer. After mailing the invoice, the clerk uses information on the stock release to

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Inventory cost is the cost of holding goods, expressed as a percentage of the inventory value that…