Rjl Wholesalers Analysis

RJL Wholesalers

RJL Wholesalers is owned by a single owner, RJ L. Smith. The company buys ice cream from various vendors and then sells the ice cream to independent ice cream shops. There is no conversion process, only a purchasing and selling process. The owner has three people working directly underneath him, the marketing manager, the logistics manager, and the controller. The marketing manager is in charge of making sales calls to prospective and current customers. The multiple salespeople who work underneath the marketing manager prepare the sales invoice after a customer has placed their order over the phone. The logistics manager is in charge of all deliveries that go in and out of the company. Working underneath him is the delivery person who delivers the ice cream to their customers. The controller is in charge of the accounting department, makes all the deposits in the bank for the company, and writes off bad debt expense at the end of each year. Underneath the controller are the accounts clerk and the cashier. The accounts clerk makes all the journal entries in the sales journal, accounts receivable journal, and cash receipts journal. The cashier receives all payments, endorses checks, and enters receipts into the cash receipts prelist. (See Organizational Chart)

After the marketing manager has successfully convinced a customer to make a purchase, a salesperson prepares a sales invoice. The salesperson consults the current price list at this point and conveys the total purchase amount to the customer. The salesperson then checks the inventory levels and notes items that are out of stock and will have to be shipped later. Then a bill of lading is prepared and given to the delivery person along with the sales invoice. The delivery person actually picks the items from inventory, loads them into his truck, and delivers the goods to the customer. Along with the goods, the customer is given two copies of the sales invoice and a copy of the bill of lading.

Two copies of the sales invoice and a copy of the bill of lading are then sent to the accounts clerk. Next the accounts clerk makes the necessary entries in the various journals. All sales are recorded in the sales journal and the accounts receivable ledger. Since all customers are given thirty days to pay for their purchases and it is not possible to pay for a purchase when ordering, all sales are recorded in the accounts receivable subsidiary ledger. The documents are then stored in permanent storage and are filed numerically by customer number.

Checks and payments are sent to the cashier who then endorses the check and enters the payment onto the cash receipts prelist. The check is then sent to the controller who prepares the bank deposit slip for each day's receipts. Then the check and bank deposit slip are brought to the bank to be deposited. The cash receipts prelist is given to the accounts clerk who uses the prelist to make entries in the cash receipts journal and the accounts receivable subsidiary ledger. The cash receipts prelist is then filed numerically in temporary storage. (See Flowcharts)

When the marketing manager makes a sales call it may or may not result in a sales order and it is possible for the marketing manager to exist without making a sales call. A sales order may