Purchases and Payments Process Quiz

What is the first step in the purchases and payments cycle?

• Payment

• Determining need

• Receiving

• Recording

Which of the following is NOT a logical category for business processes?

• Purchases and payments process

• Revenue and receipts process

• HR and payroll process

• Marketing and sales process

What type of control is aimed at preventing errors before they occur?

• Detective

• Corrective

• Directive

• Preventative

Which document is used to confirm the receipt of goods?

• Purchase Order

• Delivery Note

• Goods Received Note

• Invoice

What is the main objective of the payment process?

• To determine the need for goods

• To make valid payments and record transactions

• To record purchases accurately

• To ensure goods are received

Which of the following is a risk associated with ordering goods?

• Goods received are damaged

• Invalid purchase orders are placed

• Incorrect payments are made

• Goods are not recorded

What is the purpose of using pre-numbered order forms?

• To confirm receipt of goods

• To ensure timely payments

• To prevent fraud

• To track inventory levels

Which of the following is a characteristic of the purchases and payments cycle?

• Only one function involved

• Only applicable to manufacturing firms

• Two broad functions: ordering and receiving

• No risks involved

What can go wrong during the receiving of goods?

• Incorrect quantities received

• Goods are not ordered

• Goods are returned

• Payments are not recorded

What is a common control to manage risks in the recording of purchases?

• Comparison of invoices to purchase orders

• Inspection of goods upon receipt

• Use of approved supplier lists

• Frequent review of order files