AIS_CH1

Which of the following would contain the total value of all inventory owned by an organization?

General Ledger. It maintains summary information on inventory & every other general ledger account.

Technology activities (support activity), 14

Improve a product or service. Ex. research & development, investments in IT, and product design.

How does the chart of accounts list the general ledger accounts?

In the order in which they appear in financial statements. i.e, NOT alphabetical, NOR chronological, Nor size order.

Human Resources (support activity), 14

Includes recruiting, hiring, training, and compensating employees.

General ledger and reporting system, 9

Information-processing operations involved in updating the general ledger and preparing reports for both management and external parties.

Batch processing

Involves processing transactions in groups or batches all at the same times.

Improved monitoring capabilities.

Is an advantage of an ERP system because management gains greater visibility into every area of the enterprise that allows them to better monitor the organization.

Standardization of procedures and reports

Is an advantage of an ERP system because procedure and reports can be standardized across business units, and in mergers and acquisitions they can replace the different systems with a single, unified system.

Firm Infrastructure (support activity), 14

Is the accounting , finance, legal, and general administration activities that allow an organization to function. The AIS is part of the firm infrastructure.

Source data automation

Is the capturing of input data in machine-readable form.

Value Chain, 14

Linking together of all the primary and support activities in a business. Value is added as a product passes through a chain.

Cash Receipts Journal

Most companies have a large number of cash receipts, and thus this is NOT a specialized journal.

Cash Disbursements Journal

Most companies have a large number of disbursements, and thus this is NOT a specialized journal.

Sales Journal

Most companies have a large number of sales, and thus this is NOT a specialized journal.

Transaction Processing, 6

Process of capturing transaction data, processing it, storing it for later use, and producing information output, such as a managerial report or a financial statement.

Purchasing activities (support activity), 14

Procure raw materials, supplies, machineries, and the buildings used to carry out the primary activities.

Cash budget

Provides information only on projected cash inflows and out flows.

Which of the following documents is most likely to be used in the expenditure cycle?

Receiving report. An expenditure cycle document that is used to record the receipt of goods from suppliers. Companies pay their suppliers based on the goofs received and recorded on the receiving report.

All of the information (name, GPA, major, etc.) about a particular student is stored in the same......

Record. A record should include all information maintained by the system about a particular entity, such as a student.

Field

Represents a data storage space (accounting student would have "accounting" stores in the major field in this ex.)

Which is NOT an advantage of an ERP system?

Simplicity and reduced costs. ERP systems are quite complex and costly; they do not offer the advantages of simplicity and reduced costs.

Source documents

Source documents collect data about business activities.

Value of Information, 4

The benefit provided by information less the cost of producing it.

Information Technology (IT), 4

The computers and other electronic devices used to store, retrieve, transmit and manipulate data.

Data processing

The data processing cycle step where stored data is updated with new input data.

Data input

The first step in the data processing cycle. This is the step where data is captured, collected, and entered into the system.

Business processes or transaction cycles, 6

The major give-get exchanges that occur frequently in most companies.

Predictive Analysis, 12

The use of data warehouses and complex algorithms to forecast future events, based on historical trends and calculated probabilities.

External input documents.

These documents originate from external sources.

Date storage

This is the data processing cycle step where data is stored for future use by the company.

Give-get Exchange, 6

Transactions that happen a great many times, such as giving up cash to get inventory from a supplier and giving employees a paycheck in exchange for their labor.

Records of company data sent to an external party and then returned to the systems as input are called....

Turnaround documents. Ex. a utility bill is sent to a customer, who then returns the bill with payment.

Support Activities, 14

Value chain activities such as firm infrastructure, technology, purchasing, and human resources that enable primary activities to be performed efficiently and effectively.

Primary Activities, 14

Value chain activities that produce, market, and deliver products and services to customers and provide post-delivery service and support.

Goal Congruence, 3

When a subsystem achieves its goals while contributing to the organization's overall goal.

Goal Conflict, 3

When a subsystem's goals are inconsistent with the goals of another subsystem or the system as a whole.

Petty cash

is made up of only one account and thus is not a GL control account.

Recording and processing information about a transaction at the time it takes place is referred to as which of the following?

online, real-time processing involves processing transactions as they occur.

Retained Earnings

typically comprised of only one account and thus is not a GL control account.

Support Activities, 14

1. Firm Infrastructure 2. Human Resources 3. Technology 4. Purchasing

Primary Activities detail, 14

1. Inbound logistics - receiving & storing materials 2. Operations - manufacturing, repackaging 3. Outbound logistics - distribution, shipping 4. Marketing and Sales - Advertising and Selling 5. Service - repair and maintenance

Factors that influence the design of the AIS

1. Organizational Culture 2. Business Strategy 3. Information Technology

The Supply Chain, 15

1. Raw Materials Supplier 2. Manufacturer 3. Distributor 4. Retailer 5. Consumer

System, 3

2 or more interrelated components that interact to achieve a goal, often composed of subsystems that support the larger system.

Transaction, 6

An agreement between 2 entities to exchange goods or services, such a selling inventory in exchange for cahs; any other event that can be measure in economic terns by an organization.

Attribute

A descriptor or a characteristic of an entity (ex, the student's major is an attribute in this ex)

File

A file is designed to include information about many students.

Business process, 5

A set of related, coordinated, and structures activities and task, performed by a person, a computer, or a machine that help accomplish a specific organizational goal.

Prepaid Insurance Journal

A specialized journal is used to record large numbers of repetitive transactions, and most companies have very few prepaid insurance transactions.

Accounting Information System, 10

A system that collects, records, stores, and processes data to produce information for decision makers. It includes people, procedures and instruction, data , software, information technology infrastructure, and internal controls and security measures.

Supply Chain, 14

An extended system that includes an organization's value chain as well as its suppliers, distributors, and customers.

Which of the following is most likely to be a general ledger control account?

Accounts receivable. Typically made up of many individual customer accounts maintained in a subsidiary ledger. The total of all individual customer accounts in the subsidiary ledger is maintained in the AR control acct in the GL.

Human resources/payroll cycle, 7

Activities associated with hiring, training, compensating, evaluating, promoting, and terminating employees.

Expenditure Cycle, 6

Activities associated with purchasing inventory for resale or raw materials in exchange for cash or a future promise to pay cash.

Financing Cycle, 7

Activities associated with raising money by selling shares in the company to investors and borrowing money as well as paying dividends and interest.

Revenue Cycle, 6

Activities associated with selling goods and services in exchange for cash or a future promise to receive cash.

Production or conversion cycle, 7

Activities associated with using labor, raw materials, and equipment to produce finished goods.

Data, 4

Facts that are collected, recorded, stored, and processed by a system.

Source Document

Contains data about a particular event or transaction.

Which of the following is NOT a step in the data processing cycle?

Data Collection. Data collection is a part of data input & is there not a step in the data processing cycle.

Information, 4

Data that have been organized and processed to provide meaning and improve decision-making quality and an increase in the cost of providing information.

Why is better access control an advantage of an ERP system?

ERP can consolidate multiple permissions and security models into a single data access structure.

Information Overload, 4

Exceeding the amount of information a human mind can absorb and process, resulting in a decline in decision-making quality and an increase in the cost of providing information.

Job Time Ticket

a production cycle document that is used to record time spend on specific jobs.

Sales Order

a revenue cycle document that captures the information about a customer's order.

Credit memo

a revenue cycle document that is used to give a credit to a customer for damaged or returned goods.

Prepaid rent

a subsidiary ledger contained multiple prepaid rent accounts is not usually necessary and thus is not a GL control account.

1. Data differ from information in which way?

a. Data are output, and information is input. b. Information is output, and data are input. c. Data are meaningful bit of information. d. There is no difference. Soln: B Information is output, and data are input.

2. Which of the following is NOT a characteristic that makes information useful?

a. It is reliable b. It is timely. c. It is inexpensive. d. It is relevant. Soln: C, this is NOT one of the info. characteristics listed in Table 1.

5. Which of the following is NOT a means by which information improves decision making?

a. increases information overload b. reduces uncertainty c. provides feedback about the effectiveness of prior decisions d. identifies situation requiring management action Soln: A - increases information overload. Decision makers receiving too much information have difficulty incorporating all of the information into their decision framework, and , as a result, decision quality can be reduced rather than improved.

10. A report telling how well all approved vendors have performed in the prior 12 months is information that is MOST needed in which business process?

a. paying vendors b. acquiring inventory c. selling mechanize d. paying employees. Soln: B-acquiring inventory. Companies want to acquire inventory from companies that have performed well in the past. A vendor performance report would disclose whether the vendor shipped inventory on time, whether the inventory was of the requested quality, whether the prices were as agreed upon, etc.

6. In the value chain concept, upgrading IT is considered what kind of activity?

a. production cycle b. financing cycle c. revenue cycle d. expenditure cycle Soln: C-revenue cycle. The revenue cycle involves interactions between an organization and its customers, such as shipping them goods.

3. Which of the following is a primary activity in the value chain?

a. purchasing b. accounting c. post-sales service d. human resource management Soln: C - post-sales service is a primary activity.

8. Which of the following is a function of an AIS?

a. reducing the need to identify a strategy & strategic position b. transforming data into useful information c. allocating organizational resources d. automating all decision making Soln: B-transforming data into useful information. This is one of the primary functions of AIS.

4. Which transaction cycle includes interactions between an organization & its suppliers?

a. revenue cycle b. expenditure cycle c. human resources/payroll cycle d. general ledger & reporting system Soln: B - expenditure cyle

9. A firm, its supplies, and its customers collectively form which of the following?

a. supply chain b. value chain c. ERP system d. AIS Soln: A - Supply chain. The supply chain is made up of the firm, its suppliers, and customers.