Using a Lock-Box System

question 127

Multiple Choice

Using a lock-box system

• A) expedites the cash flow for a company.
• B) helps to reduce interest income lost due to delays in depositing out-of-state-checks.
• C) promotes the segregation of duties because a third-party handles cash receipts.
• D) All of these answers are correct.

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Definitions:

Detail Type

Detail Type in accounting software helps categorize financial transactions more specifically within a broader account type for better clarity and reporting.

COA

An abbreviation for Chart of Accounts; a systematic list of account titles and numbers used by a company to organize its financial transactions and prepare financial statements.

Sub-accounts

Secondary accounts nested under a primary account, used for more granular management of finances.

Run Report

The process of generating a summary of data or statistics, typically from a database or software application.