Acctg Exam 2-Ch 10

Front 1

expenditure cycle

Back 1

deals with the purchase of goods and services and paying for them, divided into purchases and cash payments

Front 2

functions of the expenditure cycle

Back 2

focuses on obtaining resources at a reasonable cost and paying the money owed to the vendors

Front 3

expenditure cycle-departments

Back 3

controller's (GL, a/p, cost acctg), logistics (purchase, warehouse, ship, receive), treasurer's (cash disbursements),

Front 4

expenditure cycle-basic steps

Back 4

determine when a product is needed, acquire the product, receive the goods and inspect, return or obtain purchase allowance if necessary, validate order, pay vendor cash

Front 5

expenditure cycle-basic journal entries

Back 5

record purchases, pay vendor (in or out of discount period), record return of goods

Front 6

gross method

Back 6

purchases are recorded at full amount

Front 7

net method

Back 7

purchases recorded at full amount less cash discount

Front 8

inventory subledger

Back 8

subsidiary ledger that details the specific goods that comprise the inventory account

Front 9

expenditure cycle-control objectives

Back 9

safeguard inventories and cash, authorize all purcahse transactions, record transactions accurately, safeguard records

Front 10

credit purchases-documents

Back 10

purchase requisition, purchase order, vendor invoice, vendor packing list, receiving report, journal voucher

Front 11

purchase voucher/voucher packet

Back 11

purchase requistion, purchase order, receiving report, vendor invoice

Front 12

purchase returns-documents

Back 12

debit memo-document indicating that the firm's account should be reduced because of a purchase r&a

Front 13

cash disbursements-documents

Back 13

purchase requisition, purchase order, receiving report, vendor invoice (purchase voucher package)