Accounting Information Systems Have Five Generic Elements

question 20

Essay

Accounting information systems have five generic elements.Identify and describe two examples of each element in the acquisition/payment process of PTW Corporation based on the following narrative:
PTW Corporation sells computer peripherals and related devices, such as printers, ink, flash drives and cables.PTW has a staff of three purchasing agents, each of whom is in charge of a specific set of inventory items.Each purchasing agent uses his/her discretion in making decisions about when to order inventory, how much inventory to order and which vendor to purchase from.When ordered inventory arrives at PTW, one of two receiving clerks matches the items, quantities and vendors against a copy of the purchase order, then either stocks the merchandise on the shelves or puts it in the storeroom.PTW's accountant receives a copy of the invoice from the vendor, as well as an e-mail from one of the receiving clerks indicating that merchandise has been received.The e-mail also includes the relevant purchase order number.The accountant files the invoice by date in a filing cabinet; once a week, the accountant removes invoices from the filing cabinet and pays them by check.To cut down on clutter in the office, the accountant shreds the vendor invoice after the check has been paid by the bank.The accountant also completes a bank reconciliation within two weeks of receiving the bank statement in the mail.

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Definitions:

Partnership Form

A type of business structure where two or more individuals share ownership, profits, losses, and responsibilities for managing the business.

Oral Agreement

A contract that has been agreed upon by verbal communication between parties, rather than in writing, though its legal enforceability can vary by jurisdiction and the nature of the agreement.

Revised Uniform Partnership Act

Legislation aimed at governing the operation of partnerships within the jurisdiction it is adopted, updating and replacing the original Uniform Partnership Act.

Uniform Partnership Act

A set of laws adopted by some states to regulate the operations of partnerships and ensure uniformity in their treatment.