3.7.
Ashton Fleming has asked you to document the cash receipts system at S&S. Ashton’s narrative
of the system follows:
Customer payments include cash received at the time of purchase and payments received
in the mail. At day’s end, the treasurer endorses all checks and prepares a deposit slip for
the checks and the cash. A clerk deposits the checks, cash, and deposit slip at the local
bank each day.
When checks are received as payment for accounts due, a remittance slip is included with
the payment. The Treasurer sends this to accounts receivable. The remittance slips are
used to update the accounts receivable file at the end of the day. The remittance slips are
stored in a file drawer by date.
Every week, accounts receivable generates a cash receipts report and an aged trial
balance using the accounts receivable ledger. The cash receipts report is sent to Scott and
Susan and one of them reviews it. A copy of the aged trial balance is sent to the credit and
collections department where it is reviewed.
REQUIRED
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a. Develop a context diagram and a Level 0 DFD for the cash receipts system at S&S.
Bank
Deposit
Payment at
Sale
Cash Receipts Cash
Customers Management
System Receipts
Remitances Report
on Account
Aged Trial Balance
Credit and
Collections
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Level 0 Data Flow Diagram of the Cash Receipts System at S&S:
Remittance
Customers File
Payments at
Sale
Remittances
on
Account
Remittance
Slips 2.0
1.0
Update
Process
Customer
Payments
Accounts
Endorsed
Checks &
Cash, Deposit
Slip
3.0
Accounts
Bank Prepare
Receivable
Reports
Ledger Aged Trial
Balance
Cash
Receipts
Report
Credit and
Management
Collections
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b. Prepare a document flowchart for the cash receipts system at S&S.
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c. Prepare a business process diagram for the cash receipts system at S&S.
Employee Activities Performed
Treasurer From customer
Receive cash and remittance
advices, Endorse checks, and
Prepare deposit slip
Clerk
Deposit cash
in bank
Accounts Weekly
Receivable Receive remittance Generate cash receipt
advice, Update report & aged trial
accounts receivable balance using A/R
ledger
Management:
Scott &
Review cash
Susan
receipts report
Credit and
Collections
Review aged
trail balance
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