STL COMPANY

Accounts Payable / Cash Disbursement

DAILEG, MA. ALEXANDRIA FELECIO, IRENE JOYCE OMAR, SHARINE MARIE RANIN, MANILAC MELISSA RINA, MERCEDITA

AC508 MW 1:30 3:00

MARILYN U. CORTES, CPA, MAIA NARRATIVE ACCOUNTS PAYABLE/ CASH DISBURSEMENTS

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The inventory of the company depends on the approved contract from their customers. If the customer has already 50% down payment, thats the time the product request details (PRD) are prepared by the sales engineer going to the accounting for verification. After which, PRD is then passed to the plant manager to produce the requested product, and checks availability of materials from logistics. If there is no stock of materials, they will prepare a requisition of materials for Manila which will have a minimum of 1 week lead time from Manila. The materials received from Manila will directly be placed in the warehouse. An Issuance of materials occurs under logistics, where availability of stocks is checked. If theres no more stock, then requisition of material for Manila is prepared. If Manila Main Office no longer have available stock, then that is the time that STL Corporation will purchased the metal coils from their supplier coming from Korea, Taiwan, Japan, United States and Europe. This innovative galvanizing plant has a capacity to purchase 150,000 metric tons/year.

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The purchasing department places a purchase order, while the accounting department approves based on available cash resources. The receiving department receives the order from the supplier on credit. The accounting department creates all the necessary paperwork for the purchase. As for the remaining balance, an invoice from the supplier will be received by the accounts payable department. The accounts payable department notifies the general ledger that an invoice has been received and recorded. Accounts payable requests the cashier for a payment to be made. Payment is sent to the vendor by the cashier through bank to bank transaction, paid voucher is returned to the accounts payable department and the payment notice is sent to the general ledger for reconciliation.