Which of the Following Statements Regarding Evaluated Receipt Settlement (ERS)

question 103

Multiple Choice

Which of the following statements regarding evaluated receipt settlement (ERS) is false?

• A) ERS is a system by which an organization pays for a purchase on the basis of the goods receipt.
• B) ERS can reduce the costs associated with entering invoices, matching the invoice with the PO and receiving report, and resolving discrepancies between the invoice and the PO and goods receipt.
• C) ERS arrangements are only made with vendors who have proven e-payment records.
• D) Upon receipt of the goods, the AP/CD system compares the received quantity to the open purchase quantity and, if appropriate, makes a payment based on the price and terms on the PO.

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Definitions:

Selling and Administrative Expenses

Costs related to the day-to-day operations of a business, excluding manufacturing expenses.

Internal Rate of Growth

The maximum rate at which a firm can grow its sales and revenue without needing to increase external financing, relying solely on its own profits.

Assets

Resources owned by a company or individual that have economic value and can be used to meet debts, commitments, or legacies.

Accounts Payable

This is the amount of money that a company owes to its suppliers or creditors as a result of purchasing goods or services on credit.