Chapter 1 Practice

A supply chain: 1. Does not apply to a service firm like an accounting firm. 2. Refers to the flow of materials, information, payments and services. 3. Refers to how costs are tracking in an AIS. 4. Refers to the supplies needed to build products.

2. Refers to the flow of materials, information, payments and services.

One of the most important ways that ERPs benefit organizations and their business processes is: 1. Reducing the amount of time to complete business processes by eliminating all controls associated with the processes. 2. Information is stored in many specialized, distributed databases that each serve separate business processes. 3. Current information is made available to all users involved in the activities and decisions associated with a company's business processes. 4. Preventing external business partners from accessing the organization's data.

3. Current information is made available to all users involved in the activities and decisions associated with a company's business processes.

The income statement line item most likely affected by an AIS investment in enterprise systems would be: 1. Unearned Revenue. 2. Revenues. 3. Selling, General and Administrative Expenses. 4. Cost of Goods Sold.

3. Selling, General and Administrative Expenses.

What would be the most appropriate designation for a professional who serves as an IT auditor?

Certified Information Systems Auditor (CISA)

What would be an appropriate designation for a CPA with a broad range of technology knowledge and experience?

Certified Information Technology Professional (CITP)

In the information value chain presented in the book, what precedes the receipt of information?

Data

Accounting and Finance is a primary activity in the value chain.

False

Accountants gather information relevant in solving business problems, create or extract that information, and then ______ the information to solve the problem.

analyze

To be useful to decision makers, information from an AIS must be both relevant and __________.

be a faithful representation

In the information value chain presented in the book, what precedes the collection of data?

business event

Which software manages sales and market for current sales and customer service?

customer relationship management software (CRM)

_____ manages the interaction between the company and its customer, from initial lead to customer service after the sale.

customer relationship management software (CRM)

Raw facts that describe the basic characteristics of an event would be defined as _________.

data

Activity-based costing would be an example of ____________.

discretionary information

Managerial accounting information is generally produced for internal information purposes and would be considered to be ____________.

discretionary information

A(n) _______ system serves as a central depository for information from orders, customers, sales, inventory, and employees.

enterprise

A(n) _______ system is a centralized database that collects data from throughout the firm.

enterprise , ERP, or ES

Which system can significantly lower the cost of support processes included in sales, general and administrative expenses (SG&A)?

enterprise system

External auditors accessing their client's accounting information system would be serving the accountant's role in an accounting information system of a(n) _____.

evaluator

Neutrality, or information without bias, would be considered a component of ________, which are critical for providing useful accounting information.

faithful representation

As of today, Accounting Information Systems are all computerized.

false

Data that simply collects the characteristics of different transactions has great value to an organization.

false

Relevant information's most defining characteristic is that it is free from bias and error.

false

The Certified Information Technology Professional (CITP) is a professional designation for those with a broad range of technology knowledge and does not require a CPA.

false

True or false: Supply chain is the term used to describe a firm's interactions with its current and potential clients.

false

Accounting information systems provide decision makers _______.

financial and nonfinancial information

What is a primary activity of the value chain?

inbound logistics

What is the IT strategic role that uses technology to provide information about business activities to senior management or to employees across the firm?

informate

What is the IT strategic role that uses technology to provide information to senior management?

informate-up

The International Federation of Accountants suggests that accounting can hardly be viewed separately from which field?

information technology

Sales recorded in a cash register would be an example of a(n) ____________ activity in an information system.

input

What is a primary activity of the value chain?

outbound logistics

Recorded transactions that are saved in the cloud would be an example of a(n) ____________ activity in an information system.

storage

What process refers to the flow of materials, information, payments and services from raw materials suppliers to the final customer?

supply chain

Which information system is most likely to impact the total cost of goods sold line item?

supply chain management software

Business value includes all those items, events and interactions that determine the financial health and well-being of the firm.

true

Information is defined as being data organized in a meaningful way that is useful to the user.

true

The Certified Information Systems Auditor (CISA) is a professional designation generally sought by those performing IT audits.

true

When accountants input journal entries or calculate the cost of a product input, the accountants' role in an accounting information system is that of a _____.

user