chapter 8 using accounting applications. organization of accounting applications
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Chapter 8USING ACCOUNTING APPLICATIONS
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Organization of Accounting Applications
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Using Accounting Applications
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Accounting Applications and Modules
Purchasing module Sales module Inventory module General ledger module Payroll module Jobs/projects module
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Accounting Applications and Modules
Integration of modules
Similarities across modules
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Processing Modes
4 covered in this text: Immediate recording
with immediate updating: real-time processing
Batch recording (on-line)
Off-line entry with batch recording
Immediate recording with batch updating
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Processing Modes
Immediate recording with immediate updating – real-time processing
Using the sales application
Effect of recording and updating on data tables
Prohibition against deleting posted event records
Real-time system Status reports under a
real-time system
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Processing Modes
Immediate recording with
immediate updating – real-time processing
Characteristics: Immediate recording As data are entered,
there is an immediate edit
Immediate update (posting)
Posting to the general ledger module
Event and status reports
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Processing Modes
Batch recording (on-line): Data entry steps
1. Accumulate a batch of source documents and calculate batch totals.
2. Enter each event in the batch using an accounting application.
3. Print an edit report of all events in the batch.
4. Review the report and make corrections.
5. Post the batch
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Processing Modes
Batch data entry: Edit report as a
control
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Processing Modes
Effect of batch recording on tables:
Invoice table before events are recorded
Invoice table after events are recorded
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Processing Modes
Effect of posting on tables and reports:
Batch posting as an internal control device
Characteristics of a batch recording system
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Processing Modes
Effect of posting on tables and reports:
Characteristics of a batch recording system1. Event documents
not recorded until batch is accumulated
2. Batch control totals calculated before recording events in batch
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Processing Modes
Effect of posting on tables and reports:
Characteristics of a batch recording system3. Batch control totals
are entered into the system; batch# is assigned
4. Each event document in the batch is entered one at a time, edited, and compared to data in related tables
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Processing Modes
Effect of posting on tables and reports:
Characteristics of a batch recording system5. After all events in
the batch are recorded, edit report is printed
6. Totals on the edit report are compared to the batch control totals; if agree and other data appear accurate, next step is taken
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Processing Modes
Effect of posting on tables and reports:
Characteristics of a batch recording system7. Batch is posted; posting date is recorded in the Post_Date field in the event records; summary fields in master tables are updated
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Processing Modes
Effect of posting on tables and reports:
Characteristics of a batch recording system
8. Posting to general ledger module may or may not occur at the same time the event records are posted to the master records in the module
9. Event and status reports not up-to-date until batch is posted
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Processing Modes
Effect of posting on tables and reports:
Benefits and drawbacks of batch recording
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Processing Modes
Off-line entry with batch recording:
Events are recorded electronically but without the use of the main computer
Data entry controls such as record checking are not available
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Processing Modes
Off-line entry with batch recording:
After batch is recorded off-line, it is uploaded to the main computer and checked
Report of all the errors detected is printed, corrections are made, and batch is resubmitted
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Processing Modes
Immediate recording with batch updating:
Procedures in a batch update system1. No batch totals are
taken 2. Events are
recorded as they occur
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Processing Modes
Immediate recording with batch updating:
Procedures in a batch update system3. Form used contains
a “save” button4. System checks are
done as records are being entered
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Processing Modes
Immediate recording with batch updating:
Procedures in a batch update system5. Event records are
added to the event table.
6. After several events have been recorded, a list of unposted invoices is printed
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Processing Modes
Immediate recording with batch updating:
Procedures in a batch update system7. List of unposted
event records is checked for accuracy but no comparison is made of report totals to batch control totals
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Processing Modes
Immediate recording with batch updating:
Procedures in a batch update system 8. If recordings appear
to be accurate, the group of unposted event records is posted to the master tables in the module
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Processing Modes
Immediate recording with batch updating:
Procedures in a batch update system 9. Upon posting Set Post_Date field
in event records to the current date
Summary fields in the master table are updated
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Processing Modes
Immediate recording with batch updating:
Procedures in a batch update system 10. After posting,
status reports in the module is up to date
11. Event records may or may not be posted to the general ledger
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Using Accounting Applications: Additional Issues
Posting to the general ledger:
Sales module General ledger module
Integration of sales module with general ledger module – 2 options
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Using Accounting Applications: Additional Issues
Posting to the general ledger:
General ledger module – Option 1
System adds journal entries to Journal_Entry Table
Updates account balances in general ledger as soon as batch of event documents is posted or event is recorded (in a real-time system) in the sales or other module
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Using Accounting Applications: Additional Issues
Posting to the general ledger: General ledger module – Option 2
When event records in sales module are posted, general ledger entries are created and stored in general ledger module
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Using Accounting Applications: Additional Issues
Purging 4 steps for purging
event records:1. Make sure all event
records in the module have been posted to the module’s master tables and to the general ledger
2. Print event and ledger reports
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Using Accounting Applications: Additional Issues
Purging 4 steps for purging
event records:3. Identify records to
be deleted; then archive them to off-line source
4. Delete event records are no longer needed
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K E Y T E R M S
Accounting application Archive Batch Batch recording Batch total Batch update Edit report Hash total
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K E Y T E R M S
Module Off-line On-line Posting Processing mode Purge Real-time system Record count