Answer to Question #252023 in Management for Leo

Question

The authority to accept incoming goods in the receiving of goods function (acquisition and payments cycle)should be based on what

Answer 1

The Purchases, Payables, and Payments Cycle (also known as the PPP Cycle for Purchases, Payables, and Payments) is made up mostly of two types of transactions. The acquisition class is the first. A debit to inventory or an expense and a credit to accounts payable are the most common journal entries for this type of transaction. The categorization assertion is critical in this instance since there are numerous debits that could be used to complete the journal entry.

The cash disbursements class is the second type of transaction in the acquisition and payment cycle. A debit to accounts payable and a credit to cash is the most common journal entry for this class. In general, this cycle revolves around incurring payables and paying them off with cash.