The Flow of Financial Data Through the Accounting Information System

question 26

Multiple Choice

The flow of financial data through the accounting information system does NOT include

• A) analyzing transactions.
• B) journalizing and posting transactions.
• C) preparing a trial balance.
• D) receiving payment for all accounts receivable.

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Definitions:

Depositary Bank

A financial institution that holds and manages the deposits of securities for investors, facilitating the trading of these securities.

Payor Bank

The bank on which a check is drawn and that is responsible for paying the amount of the check to the holder.

Collection Process

The steps taken by creditors or agencies to recover debts owed by individuals or businesses, often involving contacting the debtor, negotiating payment plans, and possibly legal action.

Demand Instrument

A financial document or instrument that requires payment of a particular sum of money immediately or on demand by the entitled party.