Final answer:
The revenue cycle in business consists of two subsystems: the sales subsystem and the cash receipts subsystem. The sales subsystem focuses on selling goods or services and generating revenue, while the cash receipts subsystem ensures that the company collects and records cash from sales transactions.
Step-by-step explanation:
The revenue cycle in business has two subsystems: the sales subsystem and the cash receipts subsystem.
Within the sales subsystem, the key activities include generating sales orders, preparing invoices, and recording sales transactions. This subsystem focuses on the process of selling goods or services and generating revenue.
Within the cash receipts subsystem, the key activities involve receiving payments from customers, depositing the funds into the company's bank account, and updating the accounting records to reflect the receipt of cash. This subsystem ensures that the company collects and records the cash generated from the sales transactions.