When Accounts Payable and Purchasing Systems Are Highly Automated, More

question 50

Multiple Choice

When accounts payable and purchasing systems are highly automated, more detail is included in the transaction files. This deeper level of detail is illustrated by including

• A) economic order quantities for each item that is held in inventory, including delivery times.
• B) quantities, prices, and item descriptions from each line of the supplier invoice.
• C) sequentially numbered purchase requisitions and purchase orders (with matching numbers).
• D) having receiving report numbers match the numbers on the supplier invoices for improved tracking.

Comprehend the effect of denominator level of activity on predetermined overhead rates.

Analyze the impact of variable and fixed manufacturing overhead variances.

Recognize how standard costing systems apply fixed and variable manufacturing overhead costs to products.

Evaluate the financial implications of failing to meet target activity levels.

---

Definitions:

Wrongful Interference

A legal term referring to the act of intentionally interfering with contractual or business relationships.

Business Relationship

A connection between two or more parties engaged in commercial transactions or activities, based on contractual, statutory, or recognized ethical obligations.

Intentionally Interfered

Deliberate actions taken to obstruct or meddle with someone's rights, activities, or legal interests.

Personal Property

Movable properties such as furniture, vehicles, electronics, not fixed to one location, unlike real property like land or buildings.