QUESTION 9

Just-In-Time (JIT) inventory is best characterized by

		frequent deliveries of large quantities to be held at the work centers.
		less frequent deliveries of large quantities of goods to central receiving.
		infrequent bulk deliveries of items directly to work centers.
		frequent deliveries of smaller quantities of items to the work centers.

QUESTION 10

Once a purchase request is approved, what is the next step?

		The inventory master file is accessed to find the preferred supplier(s).
		The department that created the purchase request may buy the requested item(s).
		The accounts payable department approves the purchase request, creating a purchase order.
		The system creates a purchase order.

QUESTION 11

Restricting access to the approved supplier list can

		improve the efficiency of the expenditure cycle.
		eliminate the risk of duplicate payment.
		cause purchase order approval delays.
		help reduce the risk of fraudulent disbursements.

QUESTION 12

The first major business activity in the expenditure cycle is

		receiving goods from vendors.
		ordering inventory, supplies, or services.
		a customer sale.
		shipping goods to customers.

QUESTION 13

What is the best control to mitigate the threat of paying prices that are too high for goods ordered?

		Use only approved suppliers and solicit competitive bids.
		Use bar-code technology to eliminate data entry errors.
		Only pay invoices that are supported by the original voucher package.
		Require the receiving department to verify the existence of a valid purchase order.

QUESTION 14

The receiving clerk at Wattana Technologies examines incoming shipments and checks their purchase order numbers. A receiving report is then sent to accounts payable, where it is reconciled with the relevant purchase orders and invoices and payment is authorized. Which of the following would correct control weaknesses related to the clerk's activities?

		Purchase orders and receiving reports should be reconciled by the purchasing manager.
		Vendor invoices should be approved for payment by the shipping clerk after the purchase order and receiving report are reconciled.
		Controls are adequate under the current system.
		Vendor invoices should be approved for payment by the purchasing manager.

QUESTION 15

Which electronic files are either read or updated when goods are ordered from a vendor?

		inventory, vendors, and accounts payable
		open purchase orders and accounts payable
		vendors and accounts payable
		inventory, vendors, and open purchase orders

QUESTION 16

Which of the following controls can minimize the threat of stockouts and excess inventory?

		The use of positive pay.
		Do not inform receiving employees about quantity ordered.
		The use of ERS.
		Perpetual inventory system.