1Z0-516 Oracle EBS R12.1 General Ledger Essentials Exam Set 5

You are implementing Oracle General Ledger at a client site. The client is based in the U.S. but has a global presence in many countries worldwide, and has transactions in multiple currencies. The implementation team decides that GL multi currency setup will be part of the implementation. One of the companies in Europe has a requirement to maintain account balances both in U.S. dollar and in euros, and for this purpose they have to enter each transaction twice in their present system, once in U.S. dollars and then again in euros. The Controller wants a system where transactions can be entered only in one currency, and then be automatically converted into another currency. Additionally they need the flexibility to enter different exchange rates for different types of accounts. He wants to know whether this requirement cold be fulfilled. What is your response?


Options are :

  • Transactions could be automatically converted into another currency, but different exchange rate types are not supported
  • Workflow needs to be customized to satisfy this requirement
  • Oracle GL does not support this functionality.
  • Oracle GL provides this functionality and there is no problem in satisfying the requirements. (Correct)

Answer : Oracle GL provides this functionality and there is no problem in satisfying the requirements.

You are about to set up an accounting calendar for a new set of books at ABC.com. ABC.com's fiscal year end is March 31.
The company is not sure if it wants to convert one year or two years of history in the GL. The controller wants to choose conversion of one-year history for an April 1, 2007 go-live date, but also wants to keep the option open for conversion of two-year history (to be decided before the go   
live date). ABC.com will use the GL Translation functionality, beginning from the first period, with historical GL balances. Which solution would meet ABC.com's requirement?


Options are :

  • Define the calendar for Mar-05 through Mar-08. Open Apr-06 as the first period to convert historical data. If they choose a two-year history, they can always open Apr-05 later
  • Define the calendar for Apr-05 through Mar-08. Open Apr-06 as the first period to convert historical data. If they choose a two-year history, they can always open Apr-05 later
  • Define the calendar for Apr-05 through Mar-08. Open Apr-05 through Apr-06 periods. Plan to convert historical data from Apr-06 through Mar-07. If they choose a two-year history, they can always open Apr-05 later.
  • Define the calendar for Mar-05 through Mar-08. Open Mar-05 through Apr-06 periods. Plan to convert historical data from Apr-06 through Mar-07. If they choose a two-year history, they can always close all periods except Apr-06 later. (Correct)

Answer : Define the calendar for Mar-05 through Mar-08. Open Mar-05 through Apr-06 periods. Plan to convert historical data from Apr-06 through Mar-07. If they choose a two-year history, they can always close all periods except Apr-06 later.

ABC.com, the GL accountant comes to you and says that she is running the tests to check budget functionality. She says that the GL period is closed, but she was able to post the budget journal in a closed period. You check the setups and confirm that the GL period in which Tess was able to post the budget journal is closed. What explanation do you provide to Tess? 


Options are :

  • The budget status is Current.
  • The budget year is Open (Correct)
  • The Profile option Require Budget Journal is set at the set of books level.
  • The budget status is Frozen.

Answer : The budget year is Open

ABC.com runs the Program-Create Journals, after which the Create Journal Entries Execution Report is automatically created. Identify three components that the report Create Journal Entries Execution Report reports on. (Choose three.)
A. Budget Journals
B. Purchasing Encumbrance Entries
C. Payables Encumbrance Entries
D. Journal Posting Report 


Options are :

  • A,B,C (Correct)
  • A,C,D
  • A,B,D
  • B,C,D

Answer : A,B,C

You are implementing Oracle General Ledger at a client site. The client is based in the US but has a presence in many countries worldwide, and has transactions in multiple currencies. The implementation team decides that GL multi currency setup will be part of the implementation. The Controller wants a system which allows the flexibility to enter transactions in any foreign currency, and at the same time automatically performs currency conversion online and in real time. She wants to know whether this requirement could be satisfied. What is the correct response?


Options are :

  • Oracle GL does not support this functionality
  • Oracle GL provides this functionality and there is no problem in satisfying the requirement. (Correct)
  • Account generator needs to be customized for journals to be entered in foreign currency
  • Workflow needs to be customized for journals to be entered in foreign currency.

Answer : Oracle GL provides this functionality and there is no problem in satisfying the requirement.

A General Ledger user at ABC.com opens the account inquiry screen, chooses a line item, and wants to drill down to Sub-ledger and find out more details about an Accounts Payable invoice. The user is unable to drill down. What is the likely explanation for this? (Choose two.)
A. Drilldown was option not added to responsibility.
B. Journal source was not set up to import references.
C. Journal entry was not posted.
D. Journal category was improperly setup.
E. Journal import was not done.


Options are :

  • A,B (Correct)
  • A,E
  • C,D
  • B,C

Answer : A,B

During a period, several preapproved batches of miscellaneous transactions were entered and released. The project manager informs you that he is unable to view the accounting in the expenditure inquiry form. Which process was likely omitted? 


Options are :

  • distribute costs (Correct)
  • interface costs
  • tieback costs
  • streamline costs

Answer : distribute costs

ABC.com has decided on a chart of accounts structure that consists of four segments: Company - Cost Center - Account - Sub Account. It has one company value only, and wants to have the  ability to restrict (limit the appearance of) the lists of Account values and Sub Account values for some cost centers. What are the design option would meet Newco Inc.'s requirement?


Options are :

  • Define a value set with Independent validation for each of the three segments: Cost Center, Account and Sub Account. Deselect Dynamic Inserts for the accounting flexfield structure and define all possible code combinations that are desirable for the specified cost centers
  • Define a value set for Cost Center with Independent validation and Non-Hierarchical Security. Define a value set for Account with Dependent validation that depends on Cost Center. Define a value set for Sub Account with Dependent validation that depends on Account. Enable security for the Cost Center segment and define security rules to restrict list accordingly
  • Define a value set with Independent validation and Non-Hierarchical Security for each of the three segments: Cost Center, Account and Sub Account. Enable security for all three segments and define security rules to restrict lists accordingly. (Correct)

Answer : Define a value set with Independent validation and Non-Hierarchical Security for each of the three segments: Cost Center, Account and Sub Account. Enable security for all three segments and define security rules to restrict lists accordingly.

What does the elimination program enable you to do? (Choose all that apply.)
A. eliminate average balances
B. eliminate inter company balances for fully reciprocating elimination that repeat every accounting period
C. create journal entries for all values in the source account to zero them out and post them to a target account


Options are :

  • A,C
  • B,C (Correct)
  • A,B

Answer : B,C

Which sub ledger transfers journal information directly to General Ledger to create an un posted journal entry?


Options are :

  • Payables
  • Receivables
  • Purchasing
  • Assets (Correct)

Answer : Assets

An auditor has asked the payables manager to provide detail that supports the Oracle Payables Liability amount listed on the balance sheet. Which report would best meet the auditor's request?


Options are :

  • Posted Invoice Register
  • Accounts Payable Trial Balance (Correct)
  • Payable Accounting Entries Report
  • Payables Account Analysis Report

Answer : Accounts Payable Trial Balance

ABC.com has many business units set up as company values in the Company (Balancing) segment for three sets of books: Canada, U.S. and Brazil. The sets of books share a common chart of accounts (COA) structure. The COA structure also has an Inter company segment (with
Inter company Qualifier) that uses the same value set as the Company segment. Which three options will best use GL Inter company functionality, given the multiple sets of books that share a common COA? (Choose three.)
A. Enable security for the Company segment, and define appropriate security rules, and assign them to the responsibility for each set of books.

B. Enable the profile option that automatically creates inter company accounting across sets of books.
C. Enable the Balance Inter company Journal option when defining each set of books.
D. Create a clearing company for each set of books to handle many-to-many inter company accounting in each set of books.
E. Enable security for the Company and Inter company segments, and define appropriate security rules, and assign them to the responsibility for each set of books. 


Options are :

  • A,C,D (Correct)
  • A,B,C
  • B,C,D
  • C,D,E

Answer : A,C,D

ABC.com wants to ensure that no changes are made to un posted journals that come in from their sub ledgers. At which setup can you control this? 


Options are :

  • set of books
  • journal categories
  • journal approval
  • journal sources (Correct)

Answer : journal sources

Which type(s) of journal entry does General Ledger automatically reverse and post?


Options are :

  • actuals and budgets only
  • actuals only (Correct)
  • budgets and encumbrance only
  • actuals, budgets and encumbrance

Answer : actuals only

ABC.com runs the Program-Create Journals, after which the Create Journal Entries Execution Report is automatically created. Identify three components that the report Create Journal Entries Execution Report reports on. (Choose three.)
A. Purchasing Encumbrance Entries
B. Payables Encumbrance Entries
C. Budget Journals
D. Journal Posting Report 


Options are :

  • A,C,D
  • A,B,C (Correct)
  • A,B,D
  • B,C,D

Answer : A,B,C

All of the manual journal entries are defaulting to a non current period. Which step was omitted from the accounting cycle?


Options are :

  • Reverse Journal Entries
  • Consolidate Financials
  • Translated Foreign Balances
  • Update Period (Correct)

Answer : Update Period

ABC.com's global chart of accounts structure includes the Company (balancing) segment and Inter company segment (with Inter company segment qualifier) in order to properly identify the  inter company trading party. Which statement is NOT true about using an Inter company segment in the chart of accounts structure? (Choose the statement that is NOT true.)


Options are :

  • GL automatically populates the inter company segment value in the Balancing segment to balance an inter company journal.
  • You can enable security for the Company segment and disable security for Inter company segment.
  • The Company and Inter company segments can share the same value set.
  • If a journal entry is balanced within the same company value in the balancing segment, GL automatically uses the value in the Inter company segment to create additional journal lines for the trading company. (Correct)

Answer : If a journal entry is balanced within the same company value in the balancing segment, GL automatically uses the value in the Inter company segment to create additional journal lines for the trading company.

What does the elimination program enable you to do? (Choose all that apply.)
A. eliminate average balances
B. create journal entries for all values in the source account to zero them out and post them to a target account
C. eliminate inter company balances for fully reciprocating elimination that repeat every accounting period


Options are :

  • A,B
  • B,C (Correct)
  • A,C

Answer : B,C

The controller has asked you to produce a report that identifies the total outstanding receivable by customertime period on the template to Earliest Period to identify the begin date of the new funds check level

  • delete the original template and then recreate it for the appropriate funds check level (Correct)
  • do nothing else; no additional work is needed
  • complete the required data on the template for the new funds check level
  • Answer : delete the original template and then recreate it for the appropriate funds check level

    ABC.com, the GL accountant, says that the budget for which she is trying to enter data requires budget journals, but she wants to enter budget amounts directly. You check the budget setups and confirm that the Require Budget Journal option is not enabled at the set of books level. What could be cause of Tess's problem?


    Options are :

    • The budget organization is not properly defined
    • The Allow Preparer Approval profile option is not enabled.
    • The Require Budget Journal option is enabled at the budget level (Correct)
    • The Budget status is Frozen

    Answer : The Require Budget Journal option is enabled at the budget level

    Isa Global Inc. is based in the United States with divisions in Europe and Asia. All journal imports, recurring journals, mass allocations, and manual journal entries have been posted for their European subsidiary. What is the next logical step in the period-close process? 


    Options are :

    • translating to the functional currency
    • opening the next period
    • revaluing foreign currency balances (Correct)
    • closing the current period

    Answer : revaluing foreign currency balances

    Which action is part of the Projects tieback process?


    Options are :

    • Updates cost distribution lines (Correct)
    • Balances the journal entry.
    • Interfaces cost to the General Ledger.
    • Validates the account combination.

    Answer : Updates cost distribution lines

    ABC.com, the GL accountant comes to you and says that to minimize maintenance efforts, disabled account code combinations should be automatically deleted from budget organization periodically. At the same time, if new account code combinations have been defined, then these should be automatically added. What is your response?


    Options are :

    • It is possible to automatically delete the disabled account code combinations, but new accounts need to be added manually.
    • To do this, automatically run the Maintain Budget Organization program periodically (Correct)
    • Oracle GL budget functionality cannot satisfy this requirement.
    • If the client wants to do this, then customization of workflow is the only option.

    Answer : To do this, automatically run the Maintain Budget Organization program periodically

    Which four does Oracle Consolidation enable you to consolidate? (Choose four.)
    A. multiple subsidiaries with different calendars to one parent set of books
    B. multiple subledgers such as Oracle Payables and Oracle Receivables to one parent subledger
    C. multiple subsidiaries with different currencies to one parent set of books
    D. multiple subsidiaries with same calendar to one parent set of books
    E. multiple subsidiaries to one parent set of books


    Options are :

    • B,C,A,D
    • A,C,D,E (Correct)
    • A,B,C,D
    • A,B,D,E

    Answer : A,C,D,E

    ABC.com has a calendar with 12 monthly periods. Their fiscal year is the calendar year. ABC.com uses Average Balance Processing. ABC.com's Accrual category is defined with Autoreversal, with the reversal period as the Next Day, and an effective date rule of Roll. An accrual journal entered on 29-Apr-05 will be reversed on the _____.


    Options are :

    • next business day in the same period or next period based on transaction calendar (Correct)
    • next business day in the same period
    • next day in the same period
    • first day of the next period

    Answer : next business day in the same period or next period based on transaction calendar

    ABC.com is a national company with five divisions that share the same set of books. Select the statement that best describes the consolidation process for ABC.com. 


    Options are :

    • Run revaluation, translation, and eliminations; transfer data and run financial reports
    • Run revaluation and translation, transfer data and run financial reports.
    • Enter eliminating journals and run financial reports (Correct)
    • Transfer data and run financial reports.

    Answer : Enter eliminating journals and run financial reports

    After discussions with the client, the implementation team decides that the GL Autoallocation functionality would help satisfy the clients requirements to automatically allocate the rent and other expenses to all the departments based on the defined formula. The GL accountant comes to you with a requirement that the approver of the journal should be automatically informed once the journal is generated. What is your response? 


    Options are :

    • Dynamic Insert must be enabled to satisfy this requirement.
    • It is not possible to satisfy this requirement.
    • Auto allocation uses Workflow, so there is no problem in satisfying this requirement. (Correct)
    • Cross-validation rules must be defined to satisfy this requirement

    Answer : Auto allocation uses Workflow, so there is no problem in satisfying this requirement.

    Select two actions that ledger sets permit. (Choose two.)
    A. performing variance inquiries
    B. being used for mass budgets
    C. sending budget balance inquiries
    D. viewing account balances for multiple ledgers in one view
    E. grouping multiple ledgers that share the same chart of accounts and calendar 


    Options are :

    • A,C
    • A,B
    • C,D
    • D,E (Correct)

    Answer : D,E

    Which three activities would use summary accounts? (Choose three.)
    A. Formulate a budget for employee benefits in each company based on the total of all budgeted employee salaries.
    B. Estimate a sales commission accrual based on the total of all product sales for each division.
    C. Create a monthly recurring standard journal entry to amortize Goodwill.
    D. Allocate the total monthly costs of the Information Services department to other departments.


    Options are :

    • A,B,D (Correct)
    • B,C,D
    • A,C,D
    • A,B,C

    Answer : A,B,D

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