Accounting Information Systems 7e Ulric J. Gelinas and Richard Dull Chapter 11 The Billing/Accounts Receivable/Cash Receipts (B/AR/CR) Process
Ulric J.Gelinas and Richard DullChapter 11 The Billing/Accounts Receivable/Cash Receipts (B/AR/CR) Process
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The billing/accounts receivable/cash receipts (B/AR/CR) process is an interacting structure of people, equipment, methods, and controls designed to create information flows and records that accomplish the following:
1. Shipping department informs the accounts receivable department (billing section) of shipment.
2a. Accounts receivable department (billing) sends invoice to customer.
2b. and c. Cash applications and general ledger department informed that an invoice has been sent. Accounts receivable and sales accounts are updated.
3. Customer payment is received.
4a. Cashier deposits payments in bank.
4b. and c. System informs accounts receivable department (cash applications section) of payment.
5. Cashier informs general ledger process of payment.
Invoices are prepared after goods are shipped and shipping notice compared to sales order notice
There may be a delay between receiving the order and shipping
Post-billing is assumed in Ch. 12 diagrams
Invoice prepared upon receipt of order (after inventory and credit checks)
There is little or no delay between receiving order and shippingTypes of Billing Systems