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:

Call Option

A call option gives the holder the right, but not the obligation, to buy an underlying asset at a specified price within a specific time period.

Premium

The amount by which the price of a financial asset exceeds its par or face value, or alternatively, the cost above the normal price paid to acquire an insurance policy.

Put Option

A financial contract giving the holder the right, but not the obligation, to sell a specified amount of an underlying asset at a predetermined price within a set time frame.

Put Premium

The cost associated with acquiring a put option, allowing the holder to sell an asset at a stipulated price within a specific timeframe, offering protection against asset depreciation.