Accounting -CASE A: Fred’s Electrical, Inc. (Cash Receipts Process)

| January 31, 2017

CASE A: Fred’s Electrical, Inc. (Cash Receipts Process)

Fred’s Electrical, Inc. sells electrical parts to electrical contractors in the northwest- ern United

States. Fred’s customers mail their payments—attached to the stub (i.e., remittance advice [RA])

from their monthly statement—to Fred’s accounts receivable (AR) office. An AR clerk confirms

that the check amount agrees with the amount on the RA and sends the checks to the cashier. The

AR clerk prepares batch totals of the customer numbers, invoice numbers, and amount paid. The

AR clerk then enters the batch totals and RAs into the computer, where the AR master data are

updated to record the payment. The computer reconciles the batch totals, confirms job comple-
tion, and reports discrepancies, if any, to the AR clerk.

For the case assigned by your instructor,19 complete the following requirements, using software

where diagrams are required:

a.Prepare a table of entities and activities.

b.Draw a context diagram.

c.Draw a physical data flow diagram (DFD).

d.Prepare an annotated table of entities and activities. Indicate on this

table the groupings, bubble numbers, and bubble titles to be used in

preparing a level 0 logical DFD.

e.Draw a level 0 logical DF

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