Question 1 (10 marks)

You have been asked to review the process through which cash collections are handled in a small business. You observe that a staff member in the accounts receivable department receives all incoming payments, and since the business does not accept any cheques unless approved in advance by the management, most payments are cash payments. There are odd cheque payments, but all of them were accepted because of prior approval by the management.

 

REQUIRED

 

What would your advice be to the management of this business in the context of what you observed? (10 marks) QUESTION 2- Unit 6 Conceptual

Question 2 (10 marks)

You are auditing a local pharmaceutical company. One of the newly appointed purchasing staff is an old school friend of yours. During lunch one day he tells you that the company's purchasing department is looking at their list of preferred suppliers and wonders why his line manager was adamant that purchase orders should be sent only to preferred suppliers. Adding that he personally knows a supplier that can provide raw materials at a much better price than the preferred suppliers, your friend believes that he can save the company thousands in the long run.

 

REQUIRED

What action should the local pharmaceutical company take? Provide evidence to support your decision and explain how supplier selection should be managed. (10 marks)

Ramjohn Hunte wants to store the following data about Helsinki Company's purchases of inventory:

Item number

Date of purchase

Vendor number

Vendor address

Vendor name

Purchase price

Quantity purchased

Employee number

Employee name

Purchase order number

Description

Quantity on hand

Extended amount

Total amount of purchase

REQUIRED

2. Design a set of relational tables to store this data above with Miscrosoft Excel file or Microsoft Word document. Name each table and field in accordance with good database design. Make all the data items need to be stored in a table? If not, which ones do not need to be stored, and why do they not need to be stored? (14 marks)
4. Identify the primary key for each table. (3 marks)
6. Identify the foreign keys needed in the tables to implement referential integrity. (3 marks)

 

Question (20 marks)

Renton Business Supplies sells building materials and plumbing equipment to individual as well as corporate customers. Individual customers are typically walk-in customers who pay for their purchases before leaving the store. Corporate customers often have accounts with Renton's and these customers prefer to call through their orders, have them made up, and then send a driver to collect the items. These types of corporate purchases are charged to the accounts of the corporate customers. At the end of the month, the corporate customers can either pay off the entire balance on the account, or they can pay off the balance over a period of three months. The arrangement with corporate customers is that all payments should be made via Electronic Funds Transfer.

REQUIRED

1. Draw an REA diagram for the revenue cycle of Renton Building Supplies. Include all entities and cardinalities. (20 marks)