Tag: GCSE

Which ONE of the following is a control objective relating to the sales system?

Select ONE answer:

1. Credit notes are only issued for valid reasons
2. Sales invoices are checked to Goods Despatched Notes by accounts staff
3. Customer accounts are scrutinised to see if credit limits have been observed
4. Orders are made only to authorised suppliers

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – Statement 2 is a control activity, not a control objective. Statement 3 is a test of controls, not a control objective. Statement 4 is a control objective relating to the purchases system, not the sales system.
2. Not correct
3. Not correct
4. Not correct

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The following process describes aspects of the sales system in operation at Alex plc:

For each process, select whether it represents a big strength, a big deficiency, a minor impact or no impact on the system.

• A copy of any despatch notes with incomplete orders is placed in an ‘unfulfilled orders’ file. This file is reviewed daily, and orders are filled as soon as inventory is available.

Select ONE answer:

1. Sales are only made to non-creditworthy customers
2. Goods are correctly invoiced
3. Cut-off is correct
4. Orders can be fulfilled

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 4

1. Not correct
2. Not correct
3. Not correct
4. Correct – a copy of any dispatch notes with incomplete orders filed and reviewed daily will ensure that orders are filled at a later date.

This work is licensed under a Creative Commons Attribution 4.0 International License.

The following process describes aspects of the sales system in operation at Alex plc:

For each process, select whether it represents a big strength, a big deficiency, a minor impact or no impact on the system.

• The order generates a despatch note, which is sent to the warehouse, and an invoice, which is sent to accounts receivable. Goods in inventory are dispatched immediately, and the dispatch note is amended manually for unavailable goods.

Select ONE answer:

1. a minor impact
2. a big strength
3. a big deficiency
4. no impact

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 3

1. Not correct
2. Not correct
3. Correct – the order should only be accepted once it has been confirmed that the goods ordered are available. The invoice should be generated once it is confirmed that the goods have reached the customer (as evidenced by the customer signing the dispatch note).
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

The following process describes aspects of the sales system in operation at Alex plc:

For each process, select whether it represents a big strength, a big deficiency, a minor impact or no impact on the system.

• Orders are placed by telephone. On receipt of a call, following credit checks, the order is immediately entered onto the system

Select ONE answer:

1. a minor impact
2. a big strength
3. no impact
4. a big deficiency

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Not correct
2. Correct – that orders placed by telephone, once credit checked, are entered into the system is a strength as it ensures the prompt recording of an order. Also, the customer is checked for creditworthiness before the order being generated – indicating that the company is protecting itself from loss.
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.

Which ONE of the following is an objective of the sales “ordering” part of the sales system?

Select ONE answer:

1. Sales are ONLY made to credit worthy customers
2. Goods are correctly invoiced
3. Cut-off is correct
4. Orders CANNOT be fulfilled

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 1

1. Correct – Correct invoicing is an objective of the invoicing stage of the sales system. Cut-off affects the recording stage of the sales cycle.
2. Not correct
3. Not correct
4. Not correct

This work is licensed under a Creative Commons Attribution 4.0 International License.