1. Discuss the overview of the revenue cycle.

The revenue cycle has 3 processes: sales order procedures, sales return procedures and
cash receipt procedures.
2. What are the sales order procedures? Briefly discuss each.
For receiving orders, documents such as customer orders and sales order are prepared. To
know the creditworthiness of a customer, sales managers refer to sales order (credit copy). A
sales journal will be used for transactions completed. Journals vouchers are for corrections and
adjustments. Then an inventory subsidiary ledger is used to record inventories. Lastly, the
accounts receivable for customers balances.
3. What are the sales return procedure? Briefly discuss each.
Return slips are prepared for this procedure. Then a credit memo is made to approve the
items returned by customers. The sales journal, inventory and general ledger is then updated.
4. Discuss the cash receipt procedures.
Remittance list is prepared, then deposit check are recorded, accounts receivable and
general ledgers are updated, checks are reconciled with cash receipts.
5. Discuss the basic technology revenue cycle.
Smaller businesses tend to use basic technology for managing their businesses. Example of
the technology used is a personal computer.
6. Discuss the advanced technology revenue cycle.
The ones to integrate advance technology in their businesses are corporations. It makes
operations and managing the company more efficient, less costly and more reliable.
7. What is integrated sales order system?
A salesclerk uses computers that are connected to a central sales order when receiving
orders.
8. Discuss REVENUE CYCLE RISKS AND INTERNAL CONTROLS.
Risk of selling to uncreditworthy customers:
Physical control
- Transaction authorization
- Segregation of duties
IT control
- Automated credit checking
Risk of shipping incorrect items/quantities
Physical control
- Independent verification
IT control
- Scanner technology
- Automated inventory ordering
Risk of inaccurately recording transactions in journal
Physical control
- Transaction authorization
- Accounting records
- Prenumbered documents
- Special journal
- Subsidiary ledger
- Files
- Independent verification
IT controls
- Data input edits
- Automated posting to subsidiary and GL accounts
- File back-up
Risk of misappropriation of cash receipts and inventory
Physical control
- Transaction authorization
- Supervision
- Access control
- Segregation of duties
IT Control
- Multilevel security
Risk of unauthorized access to accounting records and reports
Physical controls
- Access controls
- Segregation of duties
 IT control
- Passwords
- Multilevel security
9. What is Point-of-Sale System (POS)?
This system is used in retail stores, such as grocery store, where inventories are kept on
shelves rather than in separate warehouses.
10. discuss the end-of-day procedures in the revenue cycle.
At the end of the day, cash clerks prepares a deposit slip then is escorted by armed guards
to the bank for safety purposes.