D217 Multiple Choice

A control designed to validate a transaction at the point of data entry is a. recalculation of a batch total b. a record count c. a check digit d. checkpoints e. recalculation of hast total

A

A database deadlock a. is a lock placed on a record to prevent it from being accessed by other processes b. occurs when two records are accidentally assigned the same primary key c. occurs when a unique record is accessed by several different processes simultaneously d. none of the above

A

All of the following are characteristics of the strategic planning process except a. emphasis on both the short and long run b. analysis and review of departmental process c. review of the attributes and behavior of the organization's competition d. analysis of external economic factors e. analysis of consumer demand

A

An advantage of a physical address pointer is that a. it points directly to the actual disk storage location b. it is easily recovered if it is inadvertently lost c. it remains unchanged when disks are reorganized d. all of the above are advantages of the physical address pointer

A

An important reconciliation in the payroll system is when a. the general ledger department compares the labor distribution summary from cost accounting to the disbursement voucher from accounts payable b. the personnel department compares the number of employees authorized to receive a paycheck to the number of paychecks prepared c. the production department compares the number of hours reported on job tickets to the number of hours reported on time cards d. the payroll department compares the labor distribution summary to the hours reported on time cards

A

Application controls are classified as a. input, processing, and output b. input, processing, output, and storage c. input, processing, output and control d. input, processing, output, storage and control e. collecting, sorting, summarizing, and reporting

A

Ensuring that all material transactions processed by the information system are valid and in accordance with management's objectives is an example of a. transaction authorization b. supervision c. accounting records d. independent verification

A

In a hashtag structure a. two records can be stored at the same address b. pointers are used to indicate the location of all records c. pointers are used to indicate location of a record with the same address as another record d. all locations on the disk are used for record storage

A

Which functions should be segregated? a. picking goods from the warehouse shelves and updating the inventory subsidiary ledger b. authoring credit and determining reorder quantities c. billing customers and posting the bills to the sales journal d. providing information on inventory levels and reconciling the bank statement

A

Which is NOT a source of evidence for an external auditor? a. work performed by internal auditors who organizationally report to the controller b. test of controls c. substantive tests d. work performed by internal auditors who report to the audit committee of the BOD

A

Which ledger can be updated solely from the receiving report? a. standard cost inventory ledger b. actual cost inventory subsidiary ledger c. general ledger d. accounts payable subsidiary ledger

A

Which of the following are incompatible tasks? a. the AR clerk authorizes the write-off of bad debts b. the record-keeping clerk maintains both AR and AP subsidiary ledgers c. the inventory control clerk authorizes inventory purchases d. the AR clerk prepares customer statements every month

A

Which of the following best describes the activities of the accounting function? a. inventory control, accounts payable, fixed assets, and payroll b. fixed assets, accounts payable, cash disbursements, and cost accounting c. purchasing, cash receipts, accounts payable, cash disbursements, and payroll d. inventory control, cash receipts, accounts payable, cash disbursements, and payroll e. inventory control, cost accounting, accounts payable, cash disbursements, and payroll

A

Which of the following controls would best prevent the lapping of accounts receivable? a. segregate duties so that the clerk responsible for recording in the accounts receivable subsidiary ledger has no access to the general ledger b. request the customers review their monthly statements and report any unrecorded cash payments c. separate the tasks of depositing cash receipts and posting to the AR sub ledger d. request that customers make check payable to the company

A

Which of the following files is a temporary file? a. transaction file b. master file c. reference file d. none of the above

A

Which of the following is NOT a purpose of the transaction processing system? a. managing and reporting on the status of financial investments b. converting economic events into financial transactions c. distributing essential information to operations personnel to support their daily operations d. recording financial transactions in the accounting records

A

Which of the following is NOT a true statement? a. transactions are recorded on ledgers and are posted to journals b. transactions are recorded in journals and are post to ledgers c. infrequent transactions are recorded in the general journal d. frequent transactions are recorded in special journals

A

Which of the following is NOT true of a turn around document? a. the may reduce the number of errors made by external parties b. they are commonly used by utility companies c. they are documents used by internal parties only d. they are both input and output documents

A

Which of the following is often called a compensating control? a. supervision b. access control c. segregation of duties d. accounting records

A

Which one of the following departments does not receive a copy of the purchase order? a. general ledger b. the receiving department c. accounts payable d. the purchasing department

A

Which statement below best describes a profit center? a. the authority to make decisions affecting the major determinants of profit, including the power to choose its markets and source of supply b. the authority to make decisions affecting the major determinants of profit, including the power to choose its markets, source of supply, and significant control over the amount of invested capital c. the authority to make decisions over the most significant costs of operations, including the power to choose the sources of supply d. the authority to provide specialized support to other units within the organization e. the responsibility for combining raw materials, direct labor, and other factors of production into a final product

A

Which statement is NOT true? a. manufacturing firms have a conversion cycle but retail firms do not b. the conversion cycle includes the task of determining raw materials requirements c. a payroll check is an example of a product document of the payroll system d. a journal voucher is actually a special source document e. business activities begin with the acquisition of materials, property, and labor in exchange for cash

A

Which statement is true about a hashing structure? a. the same address could be calculated for two different records b. storage space is used efficiently c. records cannot be accessed rapidly d. a separate index is required

A

at what level of management is the long-range planning function most important? a. at top-management levels b.at middle-management levels c. at lower-management levels d. for staff functions e. for line functions

A

which is the fundamental purpose of responsibility accounting? a. variance analysis b. motivation c. authority d. budgeting e. pricing

A

which of the following situations is NOT a segregation of duties violation? a. the treasurer has the authority to sign checks but gives the signature block to the assistant treasurer to run the check-signing machine b. the sales manager has the responsibility to approve credit and the authority to write off accounts c. The warehouse clerk, who has custodial responsibility over inventory in the warehouse, selects the vendor and authorizes purchases when inventories are low d. the department time clerk is given the undistributed payroll checks to mail to absent employees. e. the accounting clerk who shares the recordkeeping responsibility for the accounts receivable subsidiary ledger performs the monthly reconciliation of subsidiary ledger and the control account

A

which of the following statements is most true? a. journal vouchers authorize all GL postings in a real-time GLS b. adjusting and reversing entries to the GL do not require journal vouchers because these entries are not transactions c. batch processing of journal vouchers is common for large organizations with multiple sources of transactions d. journal vouchers are used to capture summaries of multiple transactions but are not used to capture single transactions

A

which task should the general ledger perform? a. update the general ledger b. prepare journal vouchers c. have custody of physical assets d. have record-keeping responsibility of special journals of subsidiary ledgers e both tasks a and b

A

A coding scheme in the form of acronyms and other combinations that convey meaning is a(n) a. sequential code. b. mnemonic code. c. alphabetic code. d. block code.

B

An XBRL instance document is a. the document format used to produce web pages b. the final product (report) c. a classification scheme d. a tag stored in each database recrod

B

An employee in the receiving department keyed in a shipment from a remote terminal and inadvertently omitted the purchase order number. The best application control to detect this error would be a a. batch total b. missing data check c. completeness check d. reasonableness test e. compatibility test

B

Hercules, Inc. uses a performance reporting system that shows data for each subordinate employee who reports to a supervisor, the actual costs incurred during the period, the budgeted costs, and all variances from budget for that subordinate's department. The name of this reporting system is a. contribution accounting b. responsibility accounting c. flexible budgeting d. program budgeting e. cost-benefit accounting

B

How are individual transactions edited in a real-time file processing system? a. in a separate computer run b. in online mode as transactions are entered c. during a backup procedure d. not edited due to time constraints e. editing of real-time transactions is not necessary

B

The following are subsystems of the accounting information system, EXCEPT the a. transaction processing system b. human resources system c. general ledger/financial reporting system d. management reporting system

B

The production subsystem of the conversion cycle includes all of the following EXCEPT a. determining raw materials requirements b. make or buy decisions on component parts c. release of raw materials into production d. scheduling of goods to be produced

B

Which control helps to ensure that the inventory items are the correct type and correct amount and are in good condition? a. reconciliation with the packing slip b. issuance of the blind copy of the purchase order c. preparation of a shipping notice d. three way match

B

Which file below provides historical financial data for comparative financial reports? a. journal voucher history file b. general ledger history file c. responsibility file d. budget master file

B

Which is least appropriate type of transaction for a real-time system? a. airline reservations b. payroll c. point-of-sale transactions d. air traffic control systems e. all of these applications typically utilize real time processing

B

Which of the following benefits is least likely to result from a system of internal controls? a. reduction of cost of an external audit b. prevention of employee collusion to commit fraud c. availability of reliable data for decision-making purposes d. some assurance of compliance with the Foreign Corrupt Practices Act of 1977 e. some assurance that important documents and records are protected

B

Which of the following best describes depreciation? a. is calculated by the department that uses the fixed asset b. allocates the cost of the asset over its useful life c. is recorded weekly d. results in book value approximating fair market value

B

Which of the following is NOT an advantage of real-time processing of files over batch processing? a. shorter transaction processing time b. reduction of inventory stocks c. improved customer service d. all are advantages

B

Which of the following is NOT an element of the fraud triangle? a. ethics b. justifiable reliance c. situational pressure d. opportunity

B

Which of the following is often called a compensating control? a. transaction authorization b. supervision c. accounting records d. segregation of duties

B

Which of the following is true of the relationship between subsidiary ledgers and general ledger accounts? a. the two contain different and unrelated data b. the relationship between the two constitute part of the audit trail c. all general ledger accounts have subsidiaries d. the total of subsidiary ledger accounts usually exceeds the total in the related general ledger account

B

Which one of the following documents captures the total amount of time that individual workers spend on each production job? a. time card b. job ticket c. personnel action form d. labor distribution form e. none of the above

B

Which statement about cloud computing is most true? a. cloud computing involves long-term contracts b. cloud computing is location-independent computing c. cloud computing involves an organization selling its IT resources to a vendor and leasing back IT services from the vendor d. cloud computing involves fixed price contracts e. cloud computing involves signing entering into multiple contracts with each IP service provider to create a cloud of resources

B

Which statement below best describes an investment center? a. the authority to make decisions affecting the major determinants of profit, including the power to choose its markets and sources of supply b. the authority to make decisions affecting the major determinants of profit, including the power to choose its markets and sources of supply, and significant control over the amount of invested capital c. the authority to make decisions over the most significant costs of operations, including the power to choose the sources of supply d. the authority to provide specialized support to other units within the organization e. the responsibility of developing markets for and selling of the output of the organization

B

Which statement is NOT true batch processing? a. permits data to be edited in a separate computer run b. is subject to deadlocks when processing common accounts c. can use databases and flat files d. can be initiated from a terminal

B

what name is given to computer programs that are used for checking the validity and accuracy of transaction data? a. operating system programs b. edit programs c. compiler programs d. integrated test programs e. interrogation programs

B

which of the following would normally be considered in a strategic plan? a. setting a target of 12 percent return on sales b. maintaining the image of the company as the industry leader c. setting a market price per share of stock outstanding d. distributing monthly reports for departmental variance analysis e. both a and c

B

which statement is NOT correct? a. legacy systems may process financially significant transactions b. mainframes are exclusive to legacy systems, while modern systems use only the client-server model c. legacy systems may use database technology d. all of the above

B

An XBRL taxonomy is a. the document format used to produce webpages b. the final product (report) c. a classification scheme d. a tag stored in each database record

C

An invoice file would be coded using a(n) coding _____________ scheme A. Alphabetic B. Mnemonic C. Block D. Sequential

C

In an automated payroll processing environment, a department manager substituted the time card for the terminated employee with a time card for a fictitious employee. The fictitious employee had the same pay rate and hours worked as the terminated employee. The best control technique to detect this action using employee identification numbers would be to use a: a. batch total b. record count c. hash total d. subsequent check e. financial total

C

Providing timely information about transactions in sufficient detail to permit proper classification and financial reporting is an example of a. the control environment b. risk assessment c. information and communication d. monitoring

C

The bill of lading is prepared by the a. sales clerk b. shipping clerk c. warehouse clerk d. billing clerk

C

The underlying assumption of reasonable assurance regarding implementation of internal control means that a. auditors are reasonably assured that fraud has not occurred in the period b. auditors are reasonably assured that employee carelessness can weaken an internal control efficiency or profitability d. management assertions about control effectiveness should provide auditors with reasonable assurance e. a control applies reasonably well to all forms of computer technology

C

When viewed from the highest to most elemental level, the data hierarchy is a. attribute, record, file b. record, attribute, key c. file, record, attribute d. file, record, key e. key, record, file

C

Which control helps to ensure that the inventory items are the correct type and correct amount and are in good condition? a. reconciliation with the packing slip b. issuance of the blind copy of the purchase order c. reconcile stock release document and packing slip d. three way match

C

Which control is not a part of the fixed asset system? a. formal analysis of the purchase request b. review of the assumptions used in the capital budgeting model c. development of an economic order quantity model d. estimates of anticipated cost savings

C

Which document defines terms for shipped goods ownership? a. packing slip b. shipping notice c. bill of lading d. customer service

C

Which function or department records a sale in the sales journal? a. warehouse b. sales department c. billing department d. inventory control

C

Which of the following describe incompatible duties? a. matching purchase requisitions, receiving reports and invoices, and authorizing payment b. authorizing payment and maintaining the check register c. writing checks and maintaining the check register d. authorizing payment and maintaining the accounts payable subsidiary ledger

C

Which of the following is NOT a database management risk? a. retrieval b. storage c. summarization d. deletion

C

Which of the following is NOT a financial transaction? a. purchase of products b. cash receipts c. update valid vendor file d. sale of inventory

C

Which of the following is not a payroll system internal control? a. supervisors verify the accuracy of employee time cards b. the accounts payable department verifies the accuracy of the payroll register before transferring payroll funds to the general checking account c. paychecks are distributed by an independent paymaster d. the general ledger department reconciles the labor distribution summary and the payroll disbursement voucher e. all are payroll systems controls

C

Which of the following is not an independent verification control? a. the shipping department verifies that the goods sent from the warehouse are correct in type and quantity b. general ledger clerks reconcile journal vouchers that were independently prepared in various departments c. the billing department reconciles the shipping notices with the sales invoice to ensure that customers are billed for only the quantities shipped d. cash receipts reconcile checks from customers and remittance advices to ensure that payments are correct in amount d. all of the above

C

Which of the following sets of tasks should not be separated? a. processing customer sales orders and approving credit b. receiving cash and updating the accounts receivable subsidiary ledger c. storing inventory in the warehouse and updating the inventory subsidiary ledger d. processing customer sales orders and posting to the sales journal e. all of the above

C

Which of the following statements is correct? a. the cash disbursement function is part of accounts payable b. cash disbursement is an independent accounting function c. cash disbursement is a treasury function d. the cash disbursement function is part of the general ledger department

C

Which of the following statements is true? a. journal vouchers detailing transaction activity flow from various operational departments into the GLS, where they are independently reconciled and posted to the journal voucher history file b. journal vouchers summarizing transaction activity flow from the accounting department into the GLS, where they are independently reconciled and posted to general ledger accounts c. journal vouchers summarizing transaction activity flow from various operational departments into the GLS, where they are independently reconciled and posted the general ledger accounts d. journal vouchers summarizing transaction activity flow from operational departments into the GLS, are independently reconciled and posted to the journal voucher history file

C

Which of the following tasks should the cash disbursements clerk NOT perform? a. review the supporting documents for completeness and accuracy b. prepare checks c. approve the liability d. mark the supporting documents paid

C

Which one of the following is responsible for submitting employee pay rate changes? a. payroll b. treasurer c. personnel d. cash disbursements e. none of the above

C

Which statement is NOT correct? a. indexed random files are dispersed throughout the storage device without regard for physical proximity with related records b. indexed random files use disk storage space efficiently c. indexed random files are efficient when processing a large portion of a file at one time d. indexed random files are easy to maintain in terms of adding records

C

Which statement is NOT correct? The virtual storage access method a. is used for very large files that need both direct access and batch processing b. may use an overflow area for records c. provides an exact physical address for each record d. is appropriate for files that require few insertions and deletions

C

Which transaction is not processed in the fixed asset system? a. purchase of a building b. repair of equipment c. purchase of raw materials d. sale of company van e. all are fixed asset transactions

C

Who below is most likely to distribute paychecks? a. personnel clerk b. timekeeping clerk c. paymaster d. supervisor

C

the fraud scheme that is similar to the concept of "borrowing from Peter to pay Paul" is A. expense account fraud B. bribery C. lapping D. transaction fraud

C

which of the following is NOT an output report of the financial reporting system? a. variance analysis report b. statement of cash flows c. tax return d. comparative balance sheet

C

The objectives of the data collection activity of the general model for accounting information systems are to collect data that are

D

What is the process of posting to accounting records in a computer system? a. master file is updated to a transaction file b. master file is updated to an index file c. transaction file is updated to a master file d. master file is updated to a year-to-date file e. current balance file is updated to an index file

D

Which document typically triggers the three-way match? a. purchase requisition b. purchase order c. receiving report d. supplier's invoice

D

Which of the following are fixed asset system tasks? a. authorizing the acquisition of fixed assets b. recording depreciation expense c. computing gain and/or loss on the disposal of fixed assets d. all of the above are tasks e. a and b are tasks but c is not

D

Which of the following best describes the activities of the materials management function? a. purchasing, receiving, and inventory control b. receiving, sales, distribution, and purchasing c. receiving, sales, distribution, and purchasing d. purchasing, receiving, and storage e. purchasing, storage, and distribution

D

Which of the following documents would most likely provide audit evidence of an unrecorded liability? a. invoices b. purchase orders c. purchase requisitions d. receiving reports

D

Which of the following is NOT a characteristic of effective information? a. relevance b. accuracy c. summarization d. precision

D

Which of the following is NOT an objective of all information systems? a. support for the stewardship function of management b. support for management decision making c. support for day-to-day operations of the firm d. all of the above are objectives

D

Which of the following is NOT true? a. sorting documents that are coded alphabetically tends to be more difficult for users that sorting numeric sequences b. mnemonic codes are limited in their ability to represent items within a class c. sequential codes carry no information content beyond their order in the sequence d. mnemonic coding requires the user to memorize codes

D

Which of the following is an example of an input control? a. making sure that reports are distributed to the proper people b. monitoring the work of data entry clerks c. collecting accurate statistics of historical transactions while gathering data d. performing check-digit test on customer account number e. having another person review the design of a business form

D

Which of the following is not an example of preventive control? a. separation of responsibilities for the recording, custodial and authorization functions b. sound personnel practices c. documentation of policies and procedures d. password authentication software and hardware e. source documents for capturing sales data

D

Which of the following journal entries would a bookkeeper make to conceal the theft of cash receipts from customers in payment of their accounts? a. debit-miscellaneous expense; credit cash b. debit- petty cash; credit- cash c. debt- cash; credit accounts receivable d. debit sales returns; credit accounts receivable e. none of the above

D

Which of the following represents incompatible tasks? a. cash disbursement maintains the check register b. accounts payable maintains the accounts payable subsidiary ledger c. accounts payable is responsible for paying invoices d. accounts payable is responsible for authorizing payment of invoices

D

Which of the following statements is most accurate? a. ERP systems are commercial software packages that are sometimes called turnkey systems because they can be implemented by the user with little or no modification b. substantive tests provide evidence focused on the system controls c. public accounting firms that provide attest services that are not allowed under SOX to offer IT advisory services d. both small and large firms that have standardized information needs are potential customers for commercial software e. external auditors may rely on the work of internal auditors only if they report to the controller or the CEO of the client company

D

of the following, select the attribute that would be the best primary key in an inventory table a. item name b. item number c. item cost d. item location e. item supplier

D

which document triggers the billing function? a. bill of lading b. customer order c. sales order d. shipping notice

D

which of the following expenditure cycle tasks should not be separated? a. purchasing inventory items and updating inventory subsidiary ledger b. receiving inventory items and updating inventory subsidiary ledger c. storing inventory in the warehouse and updating inventory subsidiary ledger d. updating accounts payable records and posting to cash disbursements journal e. all of the above should be separated

D

A documentation tool used to represent the logical elements of a system is a(n) a. programming flowchart b. entity relationship diagram c. system flowchart d. data flow diagram

D.

A documentation tool that depicts the physical flow of information relating to a particular transactions through an organization is a(n) a. ER diagram b. program flowchart c. decision table d. data flow diagram e. system flowchart

E

Which of the following best describes the activities of the production function? a. maintenance, inventory control, and production planning b. production planning, inventory control, manufacturing, and cost accounting c. quality control, production planning, manufacturing and payroll d. maintenance, production planning, storage, and quality control e. manufacturing, quality control and maintenance

E

Which of the following statements is not correct? a. database systems resolve task data dependency b. the flat-file model encourages data redundancy c. a primary goal of database systems is minimize data redundancy d. database systems provide increased accessibility to data and data integration e. the database approach uses one common database to promote the concept of single user view

E

which of the following budgeting processes is LEAST likely to motivate managers toward organizational goals? a. setting budget targets at attainable levels b. participation by subordinates in the budgetary process c. use of management by exception d. holding subordinates accountable for the items they control e. having top management set budget levels

E