SYSTEM DOCUMENTATION- REVENUE CYCLE (MANUALAND COMPUTER PROCESSES)The following describes the revenue cycle procedures for a hypotheticalcompany. The sales department clerk receives hard-copy customer orders andmanually prepares a six-part hard-copy sales order. Copies of the salesorder are distributed to various departments as follows: Copies 1, 2, and3 go to the shipping department, and Copies 4, 5, and 6 are sent to thebilling department where they are temporarily filed by the billing clerk. Upon receipt of the sales order copies, the shipping clerk picks the goodsfrom the warehouse shelves and ships them to the customer. Theclerk sends Copy 1 of the sales order along with the goods to thecustomer. Copy 2 is sent to the billing department, and Copy 3 is filed inthe shipping department. When the billing clerk receives Copy 2 from the warehouse, she pulls theother copies from the temporary file and completes the documents byadding prices, taxes, and freight charges. Then, using the departmentPC, the billing clerk records the sale in the digital sales journal, sendsCopy 4 (customer bill) to the customer, and sends Copies 5 and 6 to theAR and inventory control departments, respectively. Upon receipt of the documents from the billing clerk, the AR andinventory control clerks post the transactions to the AR Subsidiary andinventory subsidiary ledgers, respectively, using their department PCs.Each clerk then files the respective sales order copies in the department. On the payment due date, the customer sends a check for the fullamount and a copy of the bill (the remittance advice) to the company.These documents are received by the mailroom clerk who distributesthem as follows:1. The check goes to the cash receipts clerk, who manually records it in the hard-copy cash receipts journal and prepares two depositslips. One deposit slip and the check are sent to the bank; the otherdeposit slip is filed in the cash receipts department.2. The remittance advice is sent to the AR clerk, who posts to thedigital subsidiary accounts and then files the document RequiredPrepare a data flow diagram and a system flowchart of the revenue cycleprocedures previously described.
SYSTEM DOCUMENTATION- REVENUE CYCLE (MANUAL
AND COMPUTER PROCESSES)
The following describes the revenue cycle procedures for a hypothetical
company.
The sales department clerk receives hard-copy customer orders and
manually prepares a six-part hard-copy sales order. Copies of the sales
order are distributed to various departments as follows: Copies 1, 2, and
3 go to the shipping department, and Copies 4, 5, and 6 are sent to the
billing department where they are temporarily filed by the billing clerk.
Upon receipt of the sales order copies, the shipping clerk picks the goods
from the warehouse shelves and ships them to the customer. The
clerk sends Copy 1 of the sales order along with the goods to the
customer. Copy 2 is sent to the billing department, and Copy 3 is filed in
the shipping department.
When the billing clerk receives Copy 2 from the warehouse, she pulls the
other copies from the temporary file and completes the documents by
adding prices, taxes, and freight charges. Then, using the department
PC, the billing clerk records the sale in the digital sales journal, sends
Copy 4 (customer bill) to the customer, and sends Copies 5 and 6 to the
Upon receipt of the documents from the billing clerk, the AR and
inventory control clerks
inventory subsidiary ledgers, respectively, using their department PCs.
Each clerk then files the respective sales order copies in the department.
On the payment due date, the customer sends a check for the full
amount and a copy of the bill (the remittance advice) to the company.
These documents are received by the mailroom clerk who distributes
them as follows:
1. The check goes to the cash receipts clerk, who manually records it in the hard-copy cash receipts journal and prepares two deposit
slips. One deposit slip and the check are sent to the bank; the other
deposit slip is filed in the cash receipts department.
2. The remittance advice is sent to the AR clerk, who posts to the
digital subsidiary accounts and then files the document
Required
Prepare a data flow diagram and a system flowchart of the revenue cycle
procedures previously described.
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