111 Terp10 Unit 3 - Financial Accounting

Front 1

1. What is the purpose of Reconciliation Accounts? (1) 101

Back 1

1. Connect subledger accounts to the General Ledger in Real Time.

Front 2

2. What is the purpose of Account Groups? (2) 95

Back 2

1. Account groups classify G/L accounts into user-defined segments
2. Determine the number range of the accounts that fall into these user-defined segments.

Front 3

3. What is a Chart of Accounts Segment? (4)

Back 3

1. It has high level control features like description
2. BS vs. P&L
3. Account group
4. Consolidation account number.

Front 4

4. What are the two segments of a G/L account master record? (2) 92

Back 4

1. Chart of Accounts Segment
2. Company Code Segments

Front 5

5. When a goods receipt is posted in Inventory Management, when is the G/L updated? (1) 213

Back 5

1. Immediately via the inventory stock account .

Front 6

6. What is the difference between a G/L account and a Reconciliation account? 93

Back 6

1. G/L: Post directly
2. Reconciliation: Cannot post directly

Front 7

7. T/F - The automatic payment process is used only for paying vendors. 248

Back 7

1. False

Front 8

8. T/F - A Business Area is a required organizational element in FI. 122

Back 8

1. False

Front 9

9. T/F - A Company Code is used for internal purposes to create balance sheet and
profit and loss statements. 122

Back 9

1. False

Front 10

10. T/F - A Chart of Accounts contains the definitions of all G/L accounts. 91

Back 10

1. True

Front 11

11. What is a Company Code Segment?

Back 11

1. It details how the company code that uses that specific account manages the account.

Front 12

12. T/F - A general ledger document is made up of a header and line items. 104

Back 12

1. True

Front 13

13. T/F - A chart of accounts can be assigned to only one company code. 92

Back 13

1. False

Front 14

14. T/F - Each company code has a separate general ledger. 91

Back 14

1. True

Front 15

What do you have to consider when creating chart of accounts in FI? (3)

Back 15

1. A company code has only one operating chart of accounts.
2. Many company codes can use the same operating chart of accounts.
3. A company code can also have a country-specific chart of accounts.

Front 16

16. T/F - The vendor master record and the customer master record have similar structures.

Back 16

1. True

Front 17

17. T/F - Within the G/L you can view a listing of individual vendor’s account balances.

Back 17

1. False

Front 18

18. T/F - A Chart of Accounts can be country specific. 91

Back 18

1. True

Front 19

19. T/F - Subledgers are not listed in the Chart of Accounts

Back 19

1. True

Front 20

20. Define Chart of Accounts. (2)

Back 20

1. Every general ledger is structured according to a Chart of Accounts
2. It contains the definitions of all GL accounts.

Front 21

21. What three attributes define all G/L accounts?

Back 21

1. Account Number
2. G/L account designation
3. Categorization of the G/L account as an income statement or Balance Sheet account.

Front 22

22. Define subledger.

Back 22

1. Subledger accounts contain detailed line item activity which is then passed to a Reconciliation G/L account in summarized form.

Front 23

23. Why have subledgers?

Back 23

1. For reasons of clarity, the GL uses Reconciliation accounts containing only collective postings.

Front 24

24. Define reconciliation account.

Back 24

1. These accounts connect the subledgers to the General ledger in real time via a summary balance.

Front 25

25. What is the difference between financial and managerial accounting? (2)

Back 25

1. Financial accounting is for external/legal reporting.
2. Managerial accounting is for internal managerial purposes.

Front 26

26. The integration between FI and CO is realized using what? (2)

Back 26

1. Primary cost elements
2. Account Assignment Category

Front 27

27. What is the significance of the company code in FI? (3)

Back 27

1. The General Ledger is managed at the Company Code level.
2. From this, the Balance Sheets required by law and the P&L statements are compiled.
3. Each company code has its own Chart of Accounts

Front 28

28. A _____________ is the smallest organizational unit for which a complete self-contained set of books can be executed.

Back 28

1. Company Code

Front 29

29. A company code is assigned to __#____ controlling area.

Back 29

1. One

Front 30

30. A _____________ is the organizational entity for which balance sheets as well as profit & loss statements can be executed across company codes covering a company’s main areas of operation.

Back 30

1. Business Area

Front 31

31. A legal entity is represented by a ________ ________ in SAP.

Back 31

1. Company Code

Front 32

32. T/F – Reconciliation accounts can be posted to directly.

Back 32

1. False

Front 33

33. What is a segment used for? (2)

Back 33

1. Chart of accounts segment: Has high level control features like description, BS vs. P&L, account group, and the consolidation account number.
2. Company code segment: Details how the company code that uses that specific account manages the account.

Front 34

34. How does parallel accounting work? (2)

Back 34

1. One ledger in the new GL has the role of a “leading” ledger. This ledger is usually used for consolidated financial statements.
2. The new GL allows you to see other ledgers in addition to the leading ledger for parallel financial reporting.

Front 35

35. What is the relationship between segment and company code?

Back 35

1. The segment details how the company code that uses that specific account manages the account.

Front 36

36. Define Controlling Area? (2)

Back 36

1. Identifies a self-contained org. structure for which costs and revenue s can be managed and allocated.
2. It represents a separate unit of cost accounting.

Front 37

37. What is the relationship among controlling area, company code and chart of accounts?

Back 37

1. Company Code: Independent accounting entity
2. Controlling Area: Represents a separate unit of cost accounting.
3. Chart of Accounts: Contains the definitions of all GL accounts.

Front 38

38. Business area is used for what?

Back 38

1. BS and P&L statements can be executed across company codes covering a company’s main areas of operation.

Front 39

39. What three entries must always be assigned when a GL account is created?

Back 39

1. Account Description
2. Account type: BS or P&L
3. Account Group

Front 40

40. T/F – A Client may contain multiple charts of accounts.

Back 40

1. True

Front 41

41. T/F – A plant must be allocated to a company code.

Back 41

1. True

Front 42

42. What are the parts of the G/L account record? (2)

Back 42

1. Chart of accounts segment
2. Company Code segment

Front 43

43. What information is included in the chart of accounts segment? (4)

Back 43

1. High level control features like the description of the account.
2. BS vs. P&L
3. Account Group
4. Consolidation account number

Front 44

44. What do account groups determine? (3)

Back 44

1. Classify GL accounts into user-defined segments.
2. The number range of the accounts.
3. Field status of the company code: Suppress, Required, Display, and Optional

Front 45

45. For operational chart of accounts, if cross code controlling is required, what must be used?

Back 45

1. The same chart of accounts.

Front 46

46. Name three advantages of the New GL: (3)

Back 46

1. Real-time Integration with FI and CO
2. Real-time document splitting
3. Parallel Accounting

Front 47

47. What three things does the posting key determine?

Back 47

1. Account type to be posted (P&L / BS)
2. Whether the entry is a debit or credit
3. Which fields are required in the entry

Front 48

48. How are profit centers used in FI?

Back 48

1. To use the GL to conduct management analysis.

Front 49

49. What is the purpose of document splitting?

Back 49

1. A single invoice can be posted to multiple segments

Front 50

50. Between which functions in FI-MM modules does a direct relationship exist? (3)

Back 50

1. Purchasing – invoice verification
2. Invoice verification – accounts payable
3. Goods issue to production order – GL account

Front 51

51. How is customer credit managed in Financial Supply Chain Management? (4)

Back 51

1. When the order is placed, a Check is run.
2. If order $$ > credit limit, order is Blocked.
3. Release the order
4. Or, Order is Rejected.

Front 52

52. What is the transaction type?

Back 52

1. It specifies exactly where the asset posting is listed in the asset history sheet.

Front 53

53. The ____________ determines the structure of a balance sheet and income statement as far as which accounts map to which line items on the report.

Back 53

1. Financial statement version.

Front 54

54. What is the purpose of a financial statement version?

Back 54

1. It determines the structure of a BS and income statement as far as which accounts map to which line items on the report.

Front 55

55. T/F – When a transaction is posted in FI, it automatically appears on the balance sheet.

Back 55

1. True: The account must be assigned to an appropriate line item in the financial statement version used when running the balance sheet. Otherwise, the posting will appear at the end of the financial statement in a category called Accounts.

Front 56

56. What is Financial Accounting? (2)

Back 56

1. FI focuses on the General Ledger, the processing of AR, AP and Asset Accounting.
2. FI is responsible for the recording of monetary (Bank Ledger) and value flows as well as the evaluation of inventory.

Front 57

57. What is the leading Ledger? (2)

Back 57

1. It reflects the set of accounting principles used to create group financial statements.
2. Used for consolidated financial statements.

Front 58

58. How is the G/L Account Document one-screen transaction set up? (4)

Back 58

1. Work Template: Here you can select screen variant, account assignment templates, or held documents.
2. Header Data: Applies to the whole document, such as posting date and document type.
3. Line Item Information: here the line items are entered.
4. Information Area: Here the debit/credit totals of the document are displayed.