Oklahoma Services Unparalleled (OSU) is a manufacturing company. The following narrative describes a portion of the cash
Question:
Oklahoma Services Unparalleled (OSU) is a manufacturing company. The following narrative describes a portion of the cash disbursement process for the company.
When vendors send an invoice to OSU for payment of raw materials used during the manufacturing process, the invoice goes directly to Gwen, OSU's accounts payable clerk. When received, Gwen uses a computer terminal to enter the invoice data into OSU’s system, where it is saved to the database. After entering the invoice, Gwen makes a copy of the invoice. The original invoice (copy 1) is then sent to Jorge, the cash disbursements clerk. Gwen files the copy of the invoice (copy 2) in a filing cabinet based on alphabetical order.
Using the original invoice, Jorge manually prepares a check to pay for the invoice. Jorge then forwards both the invoice and the check to Taylor, OSU’s Treasurer, for approval. Taylor manually reviews the invoice and check for accuracy and reasonableness. Once approved, Taylor stamps the invoiced as “PAID” and signs the check. The stamped invoice is then sent back to Jorge. Taylor also makes a copy of the signed check, then mails the original check to the vendor. Taylor files the second copy of the check-in a filing cabinet in numerical order.
Jorge enters the canceled invoice data into OSU’s system using a computer terminal. Once entered, the data is processed and saved to the database. Jorge then files the canceled invoice in alphabetical order.
At the end of the month, Gwen enters commands into a computer terminal to gather accounts payable data from the database. Once processed, the system prints the cash disbursements journal, accounts payable ledger, and accounts payable subledger.
Accounting Information Systems
ISBN: 978-1133935940
10th edition
Authors: Ulric J. Gelinas, Richard B. Dull