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The document outlines the manual procedures for the expenditure cycle of a hypothetical company, detailing the steps from inventory requisition to payment to suppliers. It describes the roles of various clerks in the purchasing, receiving, and accounts payable processes, including the documentation involved at each stage. Additionally, it provides instructions for preparing a system flowchart of these procedures, to be submitted by January 10, 2026.

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9 views1 page

Project 1

The document outlines the manual procedures for the expenditure cycle of a hypothetical company, detailing the steps from inventory requisition to payment to suppliers. It describes the roles of various clerks in the purchasing, receiving, and accounts payable processes, including the documentation involved at each stage. Additionally, it provides instructions for preparing a system flowchart of these procedures, to be submitted by January 10, 2026.

Uploaded by

micabalo.john11905
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

12/13/2025

PERIODIC 1 : PROJECT / ASSIGNMENT

SYSTEM DOCUMENTATION—EXPENDITURE CYCLE (MANUAL PROCEDURES)

The following describes the expenditure cycle manual procedures for a hypothetical company.

The inventory control clerk examines the inventory records for items that must be replenished and prepares a two-part purchase
requisition. Copy 1 of the requisition is sent to the purchasing department and Copy 2 is filed.

Upon receipt of the requisition, the purchasing clerk selects a supplier from the valid vendor file (reference file) and prepares a
three-part purchase order. Copy 1 is sent to the supplier, Copy 2 is sent to the accounts payable department where it is filed
temporarily, and Copy 3 is filed in the purchases department.

A few days after the supplier ships the order, the goods arrive at the receiving department. They are inspected, and the receiving clerk
prepares a three-part receiving report describing the number and quality of the items received. Copy 1 of the receiving report
accompanies the goods to the stores, where they are secured. Copy 2 is sent to inventory control, where the clerk posts it to the
inventory records and files the document. Copy 3 is sent to the accounts payable department, where it is filed with the purchase order.

A day or two later, the accounts payable clerk receives the supplier’s invoice (bill) for the items shipped. The clerk pulls the purchase
order and receiving report from the temporary file and compares the quantity ordered, quantity received, and the price charged.
After reconciling the three documents, the clerk enters the purchase in the purchases journal and posts the amount owed to the
account payable subsidiary account.

On the payment due date, the accounts payable clerk posts to the accounts payable subsidiary account to remove the liability and
prepares a voucher authorizing payment to the vendor. The voucher is then sent to the cash disbursement clerk. Upon receipt of the
voucher, the cash disbursements clerk prepares a check and sends it to the supplier. The clerk records the check in the check register
and files a copy of the check in the department filing cabinet.

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PERIODIC 1 : PROJECT / ASSIGNMENT

SYSTEM DOCUMENTATION—EXPENDITURE CYCLE (MANUAL PROCEDURES)

INSTRUCTIONS:

1. Prepare a system flowchart of the expenditure cycle procedures described using manual procedures.

2. Manually draw the flowchart in a short-sized bond paper.

3. Limit erasures.

4. Submit on January 10, 2026.

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Personal property of RJVL, CPA, MGM,


CTT 1

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