Deck 8: Accounting Information Systems and Business Processes: Part I

Question 1

Debit/credit memoranda are issued when there is a discrepancy about the amount owed or when goods are returned.

Answer 1

True

Question 2

The purchasing process is always complete when goods are received from vendors.

Answer 2

False

Question 3

Subsidiary ledgers are frequently maintained for accounts receivable and inventory accounts.

Answer 3

True

Question 4

A company's chart of accounts is used to organize its general ledger.

Question 5

A shipping notice is a source document that serves as a packing slip and accompanies goods sent to a customer.

Question 6

Codes are seldom used in an AIS because they use excess space.

Question 7

The purchasing process begins with a request for goods or services and ends with payment to the vendor.

Question 8

A ledger is a chronological record of business events that impact the accounting equation.

Question 9

Which of the following is not one of the trial balances typically produced as part of the financial accounting cycle?

A)Closing trial balance
B)Unadjusted trial balance
C)Adjusted trial balance
D)Post-closing trial balance

Question 10

Three primary concerns of a data collection process are accuracy, timeliness, and cost-effectiveness.

Question 11

The first step in the accounting cycle is to post a transaction to the ledger.

Question 12

Group codes are often used as product codes in a business.

Question 13

A cash disbursements journal is an example of a special journal.

Question 14

Managerial reports are the primary output of the financial accounting system.

Question 15

The AIS should bill customers for goods at the time they are ordered.

Question 16

Block codes consist of a combination of a sequence code and a mnemonic code.

Question 17

The first trial balance produced by an AIS in the accounting cycle, is the adjusted trial balance.

Question 18

The purchasing process begins with a request for goods or services and ends with receipt of the goods or services.

Question 19

Block codes are commonly used in constructing charts of accounts.

Question 20

The sales process begins with placing an order with a vendor.

Question 21

The bill of lading:

A)Signifies release of goods for shipment to customers
B)Is sent to the customer with the purchase invoice
C)Is used to control inventory

Question 22

A general ledger:

A)Is a collection of an organization's monetary transactions, organized by account
B)Does not include every account in an organization's chart of accounts
C)Is the same thing as a transaction listing

Question 23

Forecasting cash flows:

A)Is never considered an objective of transaction processing
B)Is only possible in computerized AISs
C)Is considered as a risky activity with which accountants should not be associated

Question 24

Which of the following is not a primary objective of coding systems today?

A)To uniquely identify objects
B)To convey special meanings that are not apparent to the public-at-large
C)To use numbers instead of alphabetic characters in order to save on computer data storage costs

Question 25

Inputs to transaction processing systems:

A)Are best when input in a graphical format
B)May be in an electronic format when an EDI system is used
C)May never be audio

Question 26

Which source document is used to request goods?

A)Shipping notice
B)Purchase requisition
C)Sales order

Question 27

An important input to the sales process is:

A)A customer sales order
B)The cash forecast
C)Aged accounts receivable information
D)A receiving report

Question 28

Well-designed output reports are characterized by all but which of the following?

A)They are conveniently formatted
B)They never include graphs
C)They are easily identifiable

Question 29

Information overload:

A)Refers to a problem that can result when an AIS produces too many reports
B)Refers to the situation that occurs when a company's database is too large
C)Almost always results when an AIS is computerized
D)Cannot be avoided in the Information Age

Question 30

Which of the following is not an example of a source document?

A)Purchase order
B)Sales order
C)Aging report

Question 31

Which of the following is not an objective of the sales process?

A)Controlling inventory
B)Tracking sales of goods and/or services to customers
C)Billing for goods and services
D)Forecasting sales and cash receipts

Question 32

Which of the following is not usually a design consideration in coding systems?

A)Standardization
B)Government regulation
C)Plans for future expansion

Question 33

To forecast cash receipts, information must be collected from:

A)Payroll processing
B)Inventory control systems
C)The sales process

Question 34

Performance reports are:

A)Reports that show any exception conditions in an organization
B)Adjusted trial balance
C)Transaction listings

Question 35

An AIS includes certain source documents to control sales and accounts receivable.The most complete set of documents for a manufacturer would include:

A)Purchase order, receiving report, shipping notice, sales invoice, customer remittance advice, bank deposit slip.
B)Sales order, receiving report, sales invoice, customer remittance advice.
C)Inventory reports of goods needed, purchase order, receiving report, vendor invoice.

Question 36

The primary objective in processing revenue transactions is to:

A)Achieve timely and efficient cash collection
B)Maximize an organization's sales orders
C)Only sell goods to customers who can pay their bills

Question 37

The financial accounting cycle ends with:

A)Closing journal entries and a post-closing trial balance
B)The production of an adjusted trial balance
C)Development of cash forecasts

Question 38

Which of the following is not an objective of the purchasing process?

A)Fastest possible processing of payments to vendors
B)Maintaining vendor records
C)Forecasting cash outflows

Question 39

The sales process begins with:

A)Placing an order with a vendor
B)A customer order for goods or services
C)Production of goods or services
D)Delivery of goods or services

Question 40

All of the following are inputs (source documents)to the sales process except:

A)Sales order
B)Shipping notice
C)Remittance advice
D)all of the above are source documents to the sales process

Question 41

Which of the following statements best describes business process outsourcing?

A)A company focuses on its core business processes and contracts with another firm to do the other processes
B)Companies frequently outsource core business processes
C)Due to networked enterprises and advanced technology, more employees may work from their homes or alternate locations
D)Companies engaged in business process outsourcing to offer employees more opportunities to travel and more career choices for advancement

Question 42

All of the following are inputs (source documents)to the purchasing process except:

A)Purchase order
B)Vendor invoice
C)Bill of lading
D)all of the above are source documents to the purchasing process

Question 43

When companies outsource business processes to other countries, such as India, and the Philippines, it is often the case that workers in those countries:

A)Gain job prestige
B)Enjoy a better quality of life
C)Have higher income
D)all the above

Question 44

Business organizations are recognizing the value of sales data and are purchasing software solutions to gather, maintain, and use these data to provide better service and promote customer loyalty.These software solutions are called:

A)Customer relations data solutions
B)Customer relationship management solutions
C)Sales data management solutions
D)none of the above

Question 45

Much of the input and output related to business processes is now electronic.Which of the following technologies is popular to manage inventory?

A)EDI
B)RFID tags
C)Magnetic ink characters that can be quickly and easily scanned
D)Bluetooth and wireless-enabled laptop computers

Question 46

Which of the following is an objective of accounts payable processing?

A)Collecting information for the financial statements
B)Making timely and accurate vendor payments
C)Forecasting cash requirements
D)Tracking bills of lading

Question 47

Which of the following statements best describes a business process?

A)It is a collection of related business activities in an organization that creates value
B)The nature and type of processes might vary from industry to industry
C)It is an activity that increases and/or decreases dollar amounts on the financial statements
D)It is an economic event in the life of an organization

Question 48

Networked enterprises and globalization have enabled a new business model called "business-without-boundaries." Which of the following statements describes this business model?

A)Companies no longer have all of their employees in one location
B)It is called offshoring and companies contract with firms in other countries to do such business processes as human resources, payroll, and accounting
C)Companies are under a great deal of scrutiny to manage costs and generate revenue so they contract with foreign firms to do various business processes at a lower cost to the company
D)all of the above statements describe this model

Question 49

Which of the following Business Process Management (BPM)software solutions is most often associated with the sales process?

A)Enterprise resource management
B)Integrated management
C)Customer relationship management
D)Supply chain management
E)none of the above

Question 50

Which of the following is a benefit to corporate executives when a process is outsourced?

A)Day-to-day process management responsibilities are deleted
B)More time to explore new revenue generation activities
C)More time to focus on recruiting and training personnel
D)Changing customer demands are no longer a problem

Question 51

Which of the following outputs (reports)result from both the sales process and the purchasing process?

A)Sales analysis reports
B)Financial statement information
C)both cash flow forecasts and financial statement information
D)none of the above