Deck 9: Accounting Information Systems and Business Processes: Part II

Question 1

The term vertical market refers to software distribution processes.

Answer 1

False

Question 2

Not-for-profit organizations focus primarily on the flow of funds rather than income in their internal accounting systems.

Answer 2

True

Question 3

The production process is present in service organizations.

Answer 3

False

Question 4

Production cost reports are useful for internal control since they help in calculating budget variances.

Question 5

With a job costing system it is not possible to keep track of costs for each item or group of items produced.

Question 6

Third party billing refers to the payment of many health care bills by insurance companies rather than by patients.

Question 7

The financing process concerns a company's acquisition and use of financial resources.

Question 8

The payroll process is part of the human resource management process.

Question 9

One distinguishing feature of organizations in the professional service industry is the difficulty in measuring the quantity and quality of their output when compared to manufacturing organizations.

Question 10

Time and billing features in accounting software are important to engineering, legal, and accounting firms.

Question 11

Point-of-sale accounting systems are important in the health care industry.

Question 12

The bill of materials lists the types and quantities of parts needed to assemble each unit of product.

Question 13

Financial planning models are useful to financial managers in helping them to determine an optimal strategy for acquiring and investing an organization's financial resources.

Question 14

Deposit slips and remittance advices are examples of source documents associated with the financing process.

Question 15

A cash budget is a primary output of the financing process.

Question 16

An AIS's cost accounting subsystem is an important part of the production process.

Question 17

Effective cash management is not an objective of the financing process.

Question 18

With a just-in-time inventory approach, raw material inventories are always zero.

Question 19

The primary objective of the production process is to convert raw materials to finished products as quickly as possible.

Question 20

Inputs to the production process include job time cards, material requisition forms, and the master production schedule.

Question 21

Healthcare organizations:

A)Are always not-for-profit enterprises
B)Do not include nursing homes in their industry segment
C)Have great difficulty in measuring outputs
D)Do not include patient scheduling functions in their AISs

Question 22

A major objective of professional service organizations is to:

A)Decrease billable hours
B)Increase billable hours
C)Increase time spent training employees
D)Bill customers as frequently as possible

Question 23

Which of the following characteristics are common to both service and not-for-profit organizations?

A)Importance of professional employees
B)Difficulty in measuring the quality and quantity of output
C)Inability to inventory a product
D)all of the above

Question 24

Time and billing systems are most often used by:

A)Health care organizations
B)Professional service organizations
C)Retail organizations
D)Not-for-profit organizations

Question 25

Inputs to the financing process include:

A)Remittance advices, deposit slips, checks, and stock market data
B)Remittance advices, deposit slips, checks, and receiving reports
C)Deposit slips, checks, receiving reports, and purchase requisitions
D)Deposit slips, checks, purchase requisitions, and financial institution profiles

Question 26

All of the following are input documents for the production process, except:

A)A master production schedule
B)A production order
C)A sales invoice
D)A bill of materials

Question 27

The production process begins with a request for raw materials and ends with the transfer of finished goods to warehouses.

Question 28

The objective of the fixed asset management function is to manage the purchase,
maintenance, valuation and disposal of an organization's fixed assets.

Question 29

Which of the following is an example of a not-for-profit organization?

A)Consulting firm
B)State university
C)Public hospital
D)both b and c are correct

Question 30

The AIS for the health care industry is particularly complex due to third party billing.

Question 31

An organization's working capital consists of:

A)Its checking accounts
B)Both checking and savings accounts
C)Bank accounts and other liquid assets
D)Coin and currency only

Question 32

It is generally true of not-for-profit organizations that they:

A)Are profit-oriented despite their name
B)Are always evaluated using profit measures
C)Are not governed by accounting standards
D)Emphasize funds rather than income in their internal accounting systems

Question 33

The objective of a manufacturing organization's production process is to convert
raw materials to finished goods as quickly as possible to free up cash resources.

Question 34

Which of the following is not a concern of the financing process?

A)Effective cash management
B)Optimizing an organization's cost of capital
C)Minimizing an organization's borrowings
D)Projecting cash flows

Question 35

Job costing systems are most appropriate for:

A)Home builders
B)Textbook publishers
C)Beverage companies
D)both a and b are appropriate industries for job costing systems

Question 36

Which of the following is not a characteristic associated with professional service organizations?

A)Lack of a profit motive
B)Absence of inventories
C)Importance of human resources
D)Difficulty in measuring the quantity and quality of output

Question 37

The primary objective of a manufacturing organization's production process is to:

A)Maintain inventories at a zero level
B)Convert raw materials into finished goods as efficiently as possible
C)Make sure that there are no product defects
D)Maintain the documentation and report on an organization's manufacturing process

Question 38

Which of the following statements is not true?

A)Time and billing systems in the professional service industry are similar to job order costing systems in manufacturing firms.
B)Time and billing systems are an important component of an AIS for manufacturing firms
C)A difficult problem for time and billing systems is tracking staff time
D)All of the above are true

Question 39

The largest expense item on a manufacturing organization's income statement is most likely to be:

A)Salaries for production workers
B)The depreciation associated with manufacturing equipment
C)The cost of direct materials
D)Cost of goods sold

Question 40

Third party billing refers to:

A)Billing to clients by professional service organizations
B)Billing to insurance companies by health care organizations
C)The fact that the customer often does not pay directly for goods purchased in the health care industry
D)both b and c are correct

Question 41

Lean manufacturing involves:

A)Decreasing production
B)Using nonmonetary measures of performance
C)Eliminating wasteful processes
D)all of the above

Question 42

According to the text, which of the following is an output of the human resource management process?

A)Retired employee roster
B)List of training programs for employees
C)Employee listings
D)none of the above

Question 43

Business process reengineering:

A)Is an incremental approach to redesigning business processes
B)Involves redesigning business processes from scratch
C)Is rarely successful in cutting an organization's costs
D)Is always welcomed by an organization's employees

Question 44

RFIDs allow firms to:

A)Track inventory more effectively
B)Eliminate the use of databases
C)Reduce the costs of ERP systems
D)all of the above

Question 45

Important source documents for the human resource management process do not include:

A)Valid vendor lists
B)Time sheets
C)Payroll deduction authorizations
D)Tax withholding forms

Question 46

According to the text, all of the following are objectives of the human resource management process except:

A)Hiring, training, and employing workers
B)Counseling employees on retirement and medical benefits
C)Maintaining employee earnings records
D)Reporting on payroll deductions

Question 47

Business process reengineering efforts sometimes fail because:

A)Management gets too involved in the process
B)Management is too optimistic regarding its expectations from its implementation
C)Management support can never overcome employee resistance
D)Employees will never accept change

Question 48

When using activity-based costing techniques, which one of the following departmental activities would be expected to use machine hours as a cost driver to allocate overhead costs to production?

A)Plant cafeteria
B)Machine setups
C)Material handling
D)Robotics painting

Question 49

The most significant difference in the AISs of retail organizations versus other vertical market organizations is the:

A)Sophistication of the systems used
B)Type of training programs available to employees
C)Point-of-sale data capture
D)Structure of information that the system provides to managers

Question 50

Which of the following technologies are used in conjunction with automated production process systems to increase efficiencies?

A)Radio frequency technology
B)Bar code scanners
C)FRIDs and advanced electronic tags
D)all of the above
E)none of the above