Month End Closing Process! Finance Quiz

1. There is no sequence of importance in the close transaction steps ... all that matters is that they all get performed.

True

False

The statement is false because there is indeed a sequence of importance in the close transaction steps. The order in which the steps are performed can greatly impact the outcome of the transaction. For example, certain steps like verifying the accuracy of the transaction details, obtaining necessary signatures, and recording the transaction in the appropriate systems need to be done in a specific order to ensure the transaction is properly closed. Failing to follow the correct sequence can lead to errors, legal issues, or financial loss.

Explanation

The statement is false because there is indeed a sequence of importance in the close transaction steps. The order in which the steps are performed can greatly impact the outcome of the transaction. For example, certain steps like verifying the accuracy of the transaction details, obtaining necessary signatures, and recording the transaction in the appropriate systems need to be done in a specific order to ensure the transaction is properly closed. Failing to follow the correct sequence can lead to errors, legal issues, or financial loss.

2. With regard to foreign currency translation rates

The rate with a validity date closest to the posting date without being in the future is the rate used.

Rate have to be entered before the "old" period is closed.

Rates are only entered once a month on the 15th.

Only one rate type can exist for each currency combination.

The correct answer is the rate with a validity date closest to the posting date without being in the future is the rate used. This means that when translating foreign currency, the rate that is closest to the date of the transaction is used. It should not be a rate that is in the future. This ensures that the translation is based on the most current exchange rate available at the time of the transaction.

Explanation

The correct answer is the rate with a validity date closest to the posting date without being in the future is the rate used. This means that when translating foreign currency, the rate that is closest to the date of the transaction is used. It should not be a rate that is in the future. This ensures that the translation is based on the most current exchange rate available at the time of the transaction.

3. A balance sheet and income statement can be run at any time.

True

False

A balance sheet and income statement can be run at any time because they provide a snapshot of a company's financial position and performance. These financial statements can be prepared at the end of a specific period, such as a month, quarter, or year, or they can be generated at any other point in time to assess the current financial status of the company. This flexibility allows businesses to monitor their financial health and make informed decisions based on the information provided by these statements.

Explanation

A balance sheet and income statement can be run at any time because they provide a snapshot of a company's financial position and performance. These financial statements can be prepared at the end of a specific period, such as a month, quarter, or year, or they can be generated at any other point in time to assess the current financial status of the company. This flexibility allows businesses to monitor their financial health and make informed decisions based on the information provided by these statements.

4. The FIRST closing step that needs to be performed is?

FK10N

KKAK

MMPV

VKM1

The correct answer is MMPV. MMPV is the transaction code used in SAP for closing the period in Material Ledger. It is used to perform activities such as closing the current period, updating exchange rates, and carrying out valuations for materials. This step needs to be performed first before any other closing steps can be executed in SAP.

Explanation

The correct answer is MMPV. MMPV is the transaction code used in SAP for closing the period in Material Ledger. It is used to perform activities such as closing the current period, updating exchange rates, and carrying out valuations for materials. This step needs to be performed first before any other closing steps can be executed in SAP.

5. Asset depreciation should be run before the GR/IR clearing.

True

False

Asset depreciation should be run after the GR/IR clearing. GR/IR clearing is the process of reconciling the Goods Receipt/Invoice Receipt account in the general ledger with the corresponding accounts in the subledger. Once this process is completed, the asset depreciation can be accurately calculated based on the reconciled values. Therefore, the correct answer is False.

Explanation

Asset depreciation should be run after the GR/IR clearing. GR/IR clearing is the process of reconciling the Goods Receipt/Invoice Receipt account in the general ledger with the corresponding accounts in the subledger. Once this process is completed, the asset depreciation can be accurately calculated based on the reconciled values. Therefore, the correct answer is False.

6. The month-end close process that involves production orders entails the following:

Run asset depreciation, then billing due list, and then calculate overhead.

Review blocked billing docs, then process vendor payments, and then execute order settlement.

Calculate overhead, calculate WIP, calculate variances, and then execute order settlement.

Review PO listing for goods received, not invoiced, calculate variances, and then post parked docs.

The correct answer is "Calculate overhead, calculate WIP, calculate variances, and then execute order settlement." This is because the month-end close process involving production orders requires calculating overhead costs, calculating work in progress (WIP), calculating any variances, and finally executing the order settlement. This sequence ensures that all costs and financial transactions related to production orders are accurately accounted for and settled.

Explanation

The correct answer is "Calculate overhead, calculate WIP, calculate variances, and then execute order settlement." This is because the month-end close process involving production orders requires calculating overhead costs, calculating work in progress (WIP), calculating any variances, and finally executing the order settlement. This sequence ensures that all costs and financial transactions related to production orders are accurately accounted for and settled.

7. FI Period Close t-code and related settings.

Can only be executed one time, the first day of the new period.

Can only be controlled by sub-module, not collectively.

Is part of MMPV.

The FI Period Close t-code and related settings can be customized to be set by module individually or collectively for all FI modules. This means that each module within the FI system can have its own specific period close settings, or all modules can have the same settings. Additionally, the period can be opened or closed as often as needed, based on the requirements of the organization. This flexibility allows for efficient financial period management. The statement also mentions that the period close is part of MMPV, which is a transaction code used for period close activities in SAP systems.

Explanation

The FI Period Close t-code and related settings can be customized to be set by module individually or collectively for all FI modules. This means that each module within the FI system can have its own specific period close settings, or all modules can have the same settings. Additionally, the period can be opened or closed as often as needed, based on the requirements of the organization. This flexibility allows for efficient financial period management. The statement also mentions that the period close is part of MMPV, which is a transaction code used for period close activities in SAP systems.

8. Which step in invoice creation enters the invoice into the SAP system after it has been parked?

Completing an invoice

Simulating an invoice

Posting an invoice

Answers A and C

Posting an invoice is the step in invoice creation that enters the invoice into the SAP system after it has been parked. Once the invoice has been parked, it is not yet considered as officially entered into the system. Posting the invoice finalizes the process and ensures that the invoice is recorded and accounted for in the SAP system. Therefore, the correct answer is "Posting an invoice".

Explanation

Posting an invoice is the step in invoice creation that enters the invoice into the SAP system after it has been parked. Once the invoice has been parked, it is not yet considered as officially entered into the system. Posting the invoice finalizes the process and ensures that the invoice is recorded and accounted for in the SAP system. Therefore, the correct answer is "Posting an invoice".

9. What t-code displays PO goods delivered, not invoiced?

F.19

F-32

VF04

ME2L

ME2L is the correct answer because it is a t-code that displays Purchase Order (PO) goods that have been delivered but not yet invoiced. This transaction code provides a list of all open POs with their respective delivery status, allowing users to track the goods that have been delivered but have not yet been invoiced. This information is essential for monitoring the status of deliveries and ensuring accurate financial records.

Explanation

ME2L is the correct answer because it is a t-code that displays Purchase Order (PO) goods that have been delivered but not yet invoiced. This transaction code provides a list of all open POs with their respective delivery status, allowing users to track the goods that have been delivered but have not yet been invoiced. This information is essential for monitoring the status of deliveries and ensuring accurate financial records.

10. All journal entries in GL must be posted before running a P&L report in SAP.

True

False

This statement is false because the journal entries in the general ledger (GL) do not need to be posted before running a Profit and Loss (P&L) report in SAP. In SAP, P&L reports can be generated based on both posted and unposted journal entries in the GL. Therefore, it is not necessary to post all journal entries before running a P&L report in SAP.

Explanation

This statement is false because the journal entries in the general ledger (GL) do not need to be posted before running a Profit and Loss (P&L) report in SAP. In SAP, P&L reports can be generated based on both posted and unposted journal entries in the GL. Therefore, it is not necessary to post all journal entries before running a P&L report in SAP.