Question 1

Which cash reconciling item could potentially affect either the bank statement or the general ledger?

Accepted Answer

A)  Recording error 
B)  Interest earned on notes held by the bank 
C)  Outstanding deposit 
D)  NSF checks 
A)  Recording error 
B)  Interest earned on notes held by the bank 
C)  Outstanding deposit 
D)  NSF checks A

Question 2

According to the textbook, U.S. businesses will lose 7 percent, on average, of their gross revenues to fraud, with projected losses of more than $7 trillion.

Accepted Answer

A) True 
 B)False  False

Question 3

Diagnostic analysis includes all of the possible types of analytics except for which of the following?

Accepted Answer

A)  Identifying anomalies and outliers 
B)  Performing drill-down detailed analytics 
C)  Performing marginal analysis 
D)  Performing statistical analysis 
A)  Identifying anomalies and outliers 
B)  Performing drill-down detailed analytics 
C)  Performing marginal analysis 
D)  Performing statistical analysis C

Question 4

What is an observation that lies outside its expected distribution?

Accepted Answer

A)  Outlier 
B)  Unexpected observation 
C)  Fuzzy matching 
D)  Management by exception 
A)  Outlier 
B)  Unexpected observation 
C)  Fuzzy matching 
D)  Management by exception

Question 5

According to Benford's law, numbers with the first digit "4" are more likely than those with first digit "3".

Accepted Answer

A) True 
 B)False

Question 6

A realistic expectation an accountant could hold is that each transaction (e.g., cash receipt or cash disbursement) is independent of (not identical to) any other similar transaction.

Accepted Answer

A) True 
 B)False

Question 7

What is an example of a cash reconciling item for an item recorded by the bank but not yet recorded in the general ledger?

Accepted Answer

A)  Interest earned on notes held by the bank 
B)  Outstanding deposits 
C)  Outstanding checks 
D)  There are no items recorded by the bank but not recorded in the general ledger. 
A)  Interest earned on notes held by the bank 
B)  Outstanding deposits 
C)  Outstanding checks 
D)  There are no items recorded by the bank but not recorded in the general ledger.

Question 8

Testing for duplicate transactions is an example of what type of diagnostic analytics?

Accepted Answer

A)  Identifying anomalies and outliers 
B)  Finding previously unknown linkages, patterns, or relationships between variables 
C)  Performing marginal analysis 
D)  Performing descriptive analytics 
A)  Identifying anomalies and outliers 
B)  Finding previously unknown linkages, patterns, or relationships between variables 
C)  Performing marginal analysis 
D)  Performing descriptive analytics

Question 9

The test to see if the key number field in a record is in correct ascending or descending order is called a(n) __________ check.

Accepted Answer

A)  order 
B)  sequence 
C)  compliance 
D)  sorting 
A)  order 
B)  sequence 
C)  compliance 
D)  sorting

Question 10

In a bank reconciliation, NSF checks are recorded by the __________, but not yet by the __________.

Accepted Answer

A)  company; bank 
B)  bank; company 
C)  vendor; bank 
D)  bank; vendor 
A)  company; bank 
B)  bank; company 
C)  vendor; bank 
D)  bank; vendor

Question 11

In fuzzy matching, if the tolerance for a match is set to 100%, what is the likely consequence for finding potential matches?

Accepted Answer

A)  Too many potential matches 
B)  Only exact matches, no potential matches 
C)  Good mix between exact and potential matches 
D)  Too few potential matches 
A)  Too many potential matches 
B)  Only exact matches, no potential matches 
C)  Good mix between exact and potential matches 
D)  Too few potential matches

Question 12

Benford's law applies to the ______.

Accepted Answer

A)  first digit only 
B)  second digit only 
C)  both the first and second digit 
D)  neither the first nor second digit 
A)  first digit only 
B)  second digit only 
C)  both the first and second digit 
D)  neither the first nor second digit

Question 13

Internal controls testing is an example of what type of data analytics?

Accepted Answer

A)  Identifying anomalies and outliers 
B)  Finding previously unknown linkages, patterns, or relationships between variables 
C)  Performing marginal analysis 
D)  Performing descriptive analytics 
A)  Identifying anomalies and outliers 
B)  Finding previously unknown linkages, patterns, or relationships between variables 
C)  Performing marginal analysis 
D)  Performing descriptive analytics

Question 14

If we are running a regression to analyze the question if advertising expenses are related to sales revenue outcomes, what would be the independent variable?

Accepted Answer

A)  sales revenue 
B)  advertising expenses 
C)  cost of goods sold 
D)  operating expenses 
A)  sales revenue 
B)  advertising expenses 
C)  cost of goods sold 
D)  operating expenses

Question 15

The practice of bringing specific issues to the attention of management if they depart from expectation is called __________.

Accepted Answer

A)  anomaly 
B)  management by exception 
C)  outlier 
D)  fuzzy matching 
A)  anomaly 
B)  management by exception 
C)  outlier 
D)  fuzzy matching

Question 16

The practice of identifying the difference between a budget amount and actual performance is called:

Accepted Answer

A)  anomaly analysis 
B)  outlier analysis 
C)  variance analysis 
D)  management by exception 
A)  anomaly analysis 
B)  outlier analysis 
C)  variance analysis 
D)  management by exception

Question 17

__________ looks for underlying patterns in the data by examining the data at a more detailed level in order to examine potential correlations.

Accepted Answer

A)  Fuzzy matching 
B)  Drill-down detailed analytics 
C)  Summarizing data 
D)  Descriptive analytics 
A)  Fuzzy matching 
B)  Drill-down detailed analytics 
C)  Summarizing data 
D)  Descriptive analytics

Question 18

A realistic expectation an accountant may hold is that "Most accounting transactions are made and recorded during normal work hours and normal workdays".

Accepted Answer

A) True 
 B)False

Question 19

Diagnostic analytics is performed to investigate the underlying reasons for past results that cannot be answered by simply looking at the descriptive data.

Accepted Answer

A) True 
 B)False

Question 20

A realistic expectation an accountant could hold is that addresses of the company vendors are not similar to that of the company employees.

Accepted Answer

A) True 
 B)False

Which cash reconciling item could potentially affect either the bank statement or the general ledger?

According to the textbook, U.S. businesses will lose 7 percent, on average, of their gross revenues to fraud, with projected losses of more than $7 trillion.

Diagnostic analysis includes all of the possible types of analytics except for which of the following?

What is an observation that lies outside its expected distribution?

According to Benford's law, numbers with the first digit "4" are more likely than those with first digit "3".

A realistic expectation an accountant could hold is that each transaction (e.g., cash receipt or cash disbursement) is independent of (not identical to) any other similar transaction.

What is an example of a cash reconciling item for an item recorded by the bank but not yet recorded in the general ledger?

Testing for duplicate transactions is an example of what type of diagnostic analytics?

The test to see if the key number field in a record is in correct ascending or descending order is called a(n) __________ check.

In a bank reconciliation, NSF checks are recorded by the , but not yet by the .

In fuzzy matching, if the tolerance for a match is set to 100%, what is the likely consequence for finding potential matches?

Benford's law applies to the ______.

Internal controls testing is an example of what type of data analytics?

If we are running a regression to analyze the question if advertising expenses are related to sales revenue outcomes, what would be the independent variable?

The practice of bringing specific issues to the attention of management if they depart from expectation is called __________.

The practice of identifying the difference between a budget amount and actual performance is called:

__________ looks for underlying patterns in the data by examining the data at a more detailed level in order to examine potential correlations.

A realistic expectation an accountant may hold is that "Most accounting transactions are made and recorded during normal work hours and normal workdays".

Diagnostic analytics is performed to investigate the underlying reasons for past results that cannot be answered by simply looking at the descriptive data.

A realistic expectation an accountant could hold is that addresses of the company vendors are not similar to that of the company employees.

Using Data Analytics to Ask and Answer Accounting Questions

Master the Data: an Introduction to Accounting Data

Accounting Data Data Types and How They Are Used

Master the Data: Preparing Data for Analysis

Perform the Analysis: Types and Tools of Data Analyses

Perform the Analysis: Descriptive Analyses

Perform the Analysis: Predictive Analytics

Perform the Analysis: Prescriptive Analytics

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Exam 7: Perform the Analysis: Diagnostic Analyses

Which cash reconciling item could potentially affect either the bank statement or the general ledger?

According to the textbook, U.S. businesses will lose 7 percent, on average, of their gross revenues to fraud, with projected losses of more than $7 trillion.

Diagnostic analysis includes all of the possible types of analytics except for which of the following?

What is an observation that lies outside its expected distribution?

According to Benford's law, numbers with the first digit "4" are more likely than those with first digit "3".

A realistic expectation an accountant could hold is that each transaction (e.g., cash receipt or cash disbursement) is independent of (not identical to) any other similar transaction.

What is an example of a cash reconciling item for an item recorded by the bank but not yet recorded in the general ledger?

Testing for duplicate transactions is an example of what type of diagnostic analytics?

The test to see if the key number field in a record is in correct ascending or descending order is called a(n) __________ check.

In a bank reconciliation, NSF checks are recorded by the __________, but not yet by the __________.

In fuzzy matching, if the tolerance for a match is set to 100%, what is the likely consequence for finding potential matches?

Benford's law applies to the ______.

Internal controls testing is an example of what type of data analytics?

If we are running a regression to analyze the question if advertising expenses are related to sales revenue outcomes, what would be the independent variable?

The practice of bringing specific issues to the attention of management if they depart from expectation is called __________.

The practice of identifying the difference between a budget amount and actual performance is called:

__________ looks for underlying patterns in the data by examining the data at a more detailed level in order to examine potential correlations.

A realistic expectation an accountant may hold is that "Most accounting transactions are made and recorded during normal work hours and normal workdays".

Diagnostic analytics is performed to investigate the underlying reasons for past results that cannot be answered by simply looking at the descriptive data.

A realistic expectation an accountant could hold is that addresses of the company vendors are not similar to that of the company employees.

Using Data Analytics to Ask and Answer Accounting Questions

Master the Data: an Introduction to Accounting Data

Accounting Data Data Types and How They Are Used

Master the Data: Preparing Data for Analysis

Perform the Analysis: Types and Tools of Data Analyses

Perform the Analysis: Descriptive Analyses

Perform the Analysis: Predictive Analytics

Perform the Analysis: Prescriptive Analytics

Share the Story

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In a bank reconciliation, NSF checks are recorded by the , but not yet by the .