Question

Which of the following is an example of an application control for the purchases and payments system?

A. Management approval is required for large purchases.

B. The purchase order number is automatically assigned.

C. The employee who receives supplier goods must not be the same employee who ordered the goods.

D. Defective items should be returned to suppliers promptly.

Answer 1

The correct answer is option B.

Explanation for the above statement.

1. If the purchase order is automatically numbered the purchases will recorded in a systematic manner and accuracy in the recorded information.

2. If the purchased order is automatically numbered then again that items in the purchase order will not be ordered again.

3. By this numbering reordering the same items cam be avoided. If before ordering some items the old purchase orders should be verified.

4. The payment also controlled if the orders gave proper numbering . Once a numbered purchase order is paid and all the details of that order is entered in the system then if we goes to make payments of same numbered order once again automatically the system itself shows error that this numbered order is already paid.

5. By this we can avoid double payment of the same order.

6. Not only in the system the people who maintain manually also can use this. In manual method if the person who pays amount verify all the paid orders then if that order is numbered so that the person find those order is get paid already and doesn't pay again. It avoids double payment of purchase orders.

These are the explanation for the above givem statement.

I hope, all the above given points are useful and helpful to you.

Thank you.