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Saturday, August 27, 2016

Oracle AR (Account Receivables) Interview Questions

1. How do you create a Chargeback Invoice ?
A. Using Receipts window

2. How do you adjust the amount of advance already received against an Invoice ?
A. Create an Invoice for Deposit and receive an amount against this deposit Invoice. Then Create the regular invoice and in the column of Commitments enter the number of Deposit Invoice. The Regular Invoice gets matched with the Deposit Invoice for the amount of Regular invoice or deposit invoice which ever is lower

3. How do you write off small amounts while accounting the receipt against an invoice?
A. Using Receipts window. You have the button for write offs.

4. How do you Account for bank charges deducted from amount received against an invoice?
A. Using Quick cash window also you can enter receipts. Here you have the option of accounting the bank charges deducted on receipt. However, this has to be enabled by putting the Value in profile option AR: Create Bank Charges = YES.

5. How do you create a credit note against an invoice ?
A. You have separate window to create such credit note. Navigation Transactions => Credit Transactions.

7. What are different types of Receipt Reversals ? What is the difference between them ? What are the accounting entries ?
A. Standard Reversal and Debit Note Reversal. Standard Reversal reopens the invoice matched in that receipt. You can match a new receipt against this invoice.
Debit Note Reversal does not reopens the earlier matched invoice but it creates a new debit note which can be matched with another receipt.

8. When are the following accounts are used
Unbilled Receivable
Unearned Revenue
A. When you use Invoicing Rule, the receivables are accounted on different dates as defined in the rule. Till such time receivables are accounted, the amount is debited to Unbilled Receivables.
If you use Accounting Rule, the revenue is accounted on different dates. Till such time revenue is accounted, the amount is credited to Unearned Revenue..

9. What is the difference between Unidentified Receipt, Unapplied Receipts and On Account Receipts ? What are the Accounting Entries for each of this ?
A. Unidentified Receipts: The Customer is yet to be identified and so receipt is not matched.
Unapplied Receipts: The Customer is identified and entered but the amount is not matched with any of his invoice.
On Account Receipts: The Customer is entered and instead of matching the amount to any of his invoice it is matched with the On Account option. This option is available as first item in the pick list of invoices.

10. What is the difference between earned discounts and Unearned discounts ? How do you account the Unearned discount? What are the accounting entries involved ?
A. The cash discounts are mentioned in the payment terms. Considering the due date and the receipt date the discount is automatically calculated while entering the receipt. If however you want to increase the amount of invoice you can manually increase it. The amount automatically calculated as per terms is the Earned Discount. The manually added amount is the Unearned Discount. This however, depends upon the option given in System Options in Setup.

11. What are the Key Flexfields in AR.
A. Sales Tax Location Flexfield
Territory Flexfield
AR Setup Related

12. What is difference between transaction type and transaction source ?
A. Transaction type can either be Invoice, Credit Note, Debit Note, Deposit. Etc. This also decides whether to account in GL, Whether to consider in receivables, the accounts to be debited, credited, the tax calculation options, and some other options which are defauled.
Transaction Source decides whether the source of entry is manual or automatic. It also mentions whether transaction and batch numbering is manual or automatic.
If automatic the last entered number is to be mentioned to start the automatic numbering. IF the source is automatic, that means the transactions are to be uploaded through interface either from OE or legacy system. Then some other options are to be set.

13. What is AutoAccounting ?
A. This is the account generator in Accounts receivables. This decides accounts for
Receivables
Revenue
AutoInvoice Clearing
Freight
Tax
Unbilled Receivable
Unearned Revenue

From where the accounts are defaulted ?
Sales reps
Transaction Lines
Transaction Types
Taxes
Or you can have Constant values

14. What is AutoCashRule Set ?
This decides the sequence of the invoice matching rules for unmatched receipts entered though quich cash or AutoLockBox(interface). The rules are already defined in the system. Like “Match Payment with Invoice”, “Apply to the Oldest Invoice First”, “Clear the Account”, etc.

15. Where do you attach the Set Of Books ? Can you attach more than one set of books ? if you have more then one set of books then how Receivables is configured ?
You attach the set of books in System Options in Setup. Only one set of books can be attached. If you have more then one set of books then AR is to be set in multi org environment. By specifying the “MO Operating Unit” and the “GL Set of Books Name”.

16. How do you define document numbering for receipts ? can you have different sequences for each Payment Method.

In system administration. You can have different sequences for different payment methods.

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