Acct 3222 - Final Exam with accurate detailed solutions

Acct 3222 - Final Exam with accurate detailed solutions || || || || || || || ||




Revenue - ✔✔inflows of assets from delivery or producing goods or rendering services - realized
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and earned ||




Realized - ✔✔product/service is exchanged for cash/promise/other asset
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Earned - ✔✔products have been delivered or services provided
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Criteria for Revenue - ✔✔- evidence
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- delivered/rendered
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- price fixed and determinable
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- assured collectability
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Fraud Risk - Revenue - ✔✔- Alter Terms
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- Channel Stuffing
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- Related-Parties
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- Bill/Hold Sales
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Trans and Accts - Revenue - ✔✔1. Sales = AR, Sales, AFDA, BDE
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2. Cash Receipts = Cash, AR, Discounts
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3. Returns = SR&A, AR
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Documents and Records - Revenue - ✔✔- Customer SO || || || || || || || ||




- Credit Approval Form
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- Open-Order Report
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- Shipping Doc
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, - Sales Invoice
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- Sales Journal
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- Customer Stmt
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- AR subsidiary Ledger
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- Aged TB of AR
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- Remittance Advice
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- Cash Receipts Journal
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- Credit Memo
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- Write-off Authorization
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Major Functions - Revenue - ✔✔1. Order Entry - acct orders into system
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2. Credit Auth - creditworthiness, monitor pmts
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3. Shipping
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4. Billing - issue invoice, process adj
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5. Cash Receipts
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6. AR - record indiv accts
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7. GL - accum/classify/summary of accts
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Segregation of Duties - Revenue - ✔✔Credit Authorization and Billing || || || || || || || || ||




AR and GL || ||




Shipping and Billing || ||




Cash Recipts and AR || || ||




IR Assessment - Revenue - ✔✔identify factors affecting both rev and cash receipts transactions
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and FS accts || ||




- industry related factors
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- complexity/continuance of rev rec issues
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