Deck 1: Introduction to Accounting Information Systems

Question 1

According to the Sarbanes-Oxley Act of 2002, management must audit and report on auditors' assertions about the organizations' systems of internal controls.

Answer 1

False

Question 2

According to the Sarbanes-Oxley Act's Section 409, material changes in the organization's financial condition must be disclosed to the public on a rapid and current basis.

Answer 2

True

Question 3

An information system consists of an integrated set of computer-based and manual components established to provide information to users.

Answer 3

True

Question 4

Internal control is a process that provides complete assurance that the organization is meeting its objectives, such as efficiency and effectiveness of operations and reliable reporting.

Question 5

The purpose of an accounting information system is to collect, process, and report financial aspects of business events.

Question 6

Sarbanes-Oxley Section 404 compliance is a major line of business for the biggest accounting firms.

Question 7

The Sarbanes Oxley Act of 2002 applies to publicly traded companies and not-for-profit entities.

Question 8

The Sarbanes-Oxley Act of 2002 has dramatically changed the daily work of financial accountants and auditors.

Question 9

The MIS is a subsystem of the AIS.

Question 10

Financial care for the elderly has been identified by the AICPA as a potential assurance service.

Question 11

Mobile and remote computing was identified as one of the ten most important 2008 technological challenges and opportunities facing CPAs.

Question 12

According to the Sarbanes-Oxley Act of 2002, management must identify, document, and evaluate significant internal controls.

Question 13

The Sarbanes-Oxley Act's Section 404 creates changes in both how companies document and evaluate internal control and how auditors audit and report on internal control.

Question 14

The three themes of the text are operating systems, e-business, and internal control.

Question 15

Enterprise systems provide complete integration of an organization's business events and information processing systems.

Question 16

In an assurance service the accountant will provide the original information used for decision making.

Question 17

Billing/accounts receivable is traditionally part of the AIS.

Question 18

Sales/marketing information system is traditionally part of the AIS.

Question 19

Knowledge of Microsoft Access was identified as one of the ten most important 2008 technological challenges and opportunities facing CPAs.

Question 20

Production and personnel are part of the operations process.

Question 21

The most important information for tactical management involves information about the organization's environment.

Question 22

Information about a customer's credit history that is received after the decision to grant additional credit lacks completeness.

Question 23

A system can be further divided into

A)input data
B)subsystems
C)databases
D)enterprise systems

Question 24

An information system:

A)is composed of only the computer-based information resources of an organization
B)may consist of both computer-based and manual components
C)is different from a data processing system because it uses computers
D)is not generally used for transaction processing

Question 25

A set of interdependent elements that together accomplish specific objectives is a

A)system
B)subsystem
C)database
D)accounting information system

Question 26

How much inventory to reorder is a structured decision.

Question 27

Strategic management requires more detailed information than operations management.

Question 28

Much of the information used by strategic managers comes from outside the organization.

Question 29

The consistency principle is violated when a firm uses straight-line depreciation one year and changes to declining balance depreciation the next year.

Question 30

The three steps in decision making take place in the sequence of (1) intelligence (2) design (3) choice.

Question 31

Middle management requires information that is more accurate and timely than strategic management.

Question 32

The three themes of the text book include all of the following except:

A)enterprise systems
B)risk assessment
C)e-business
D)internal control

Question 33

The management process includes marketing and sales.

Question 34

Efficiency and effectiveness of operations are goals of:

A)enterprise systems
B)risk assessment
C)e-business
D)internal control

Question 35

Internal control issues are some of the questions the accountant answer in the design of the AIS.

Question 36

Generally, the benefits obtained from improved information are easier to measure than the costs of obtaining those benefits.

Question 37

The AICPA has identified all but which of the following as assurance services?

A)risk assessment
B)information systems reliability
C)electronic commerce
D)consulting

Question 38

Information that is capable of making a difference in a decision-making situation, by reducing uncertainty or increasing knowledge for that particular decision, has the quality of relevance.

Question 39

A system that consists of an integrated set of computer-based and manual components established to collect, store, and manage data and to provide output information to users is a(n)

A)output
B)input
C)database
D)information system

Question 40

Accuracy is the correspondence or agreement between the information and the actual events or objects that the information represents.

Question 41

____ are facts and figures in raw form.

A)Data
B)Information
C)Objectives
D)Goals

Question 42

All of the following are components of reliability except:

A)validity
B)accuracy
C)verifiability
D)feedback value

Question 43

The correspondence or agreement between the information and the actual events or objects that the information represents is known as

A)accuracy
B)completeness
C)neutrality
D)comparability

Question 44

The functional model of an information system can be described as

A)Output, Input, Processing, Users
B)Input, Processing, Output, Users
C)Processing, Input, Users, Output
D)Users, Processing, Input, Output

Question 45

A man made system consisting of people, authority, organization, policies and procedures with the objective of accomplishing the work of the planning and controlling the operations of the organization.

A)organization process
B)management process
C)information system
D)strategic planning

Question 46

The minimum threshold for recognition is

A)relevance
B)materiality
C)reliability
D)decision usefulness

Question 47

Which of the following statements is false?

A)Management designs the operations and information processes and establishes these processes with people, equipment, and policies.
B)Information process users include operations personnel, management, and people outside the organization.
C)Operations related and accounting related processes are designed by those external to the organization.
D)None of the statements are true.

Question 48

All of the following are components of relevance except:

A)feedback value
B)predictive value
C)verifiability
D)timeliness

Question 49

Which of the following statements is true?

A)The information process facilitates operations by maintaining inventory and customer data.
B)The information process provides the means by which management monitors the operations process.
C)Operations-related processes and accounting-related processes are integrated.
D)All of the statements are true.

Question 50

The _________________ suggests that technology improves information available for decision making

A)AICPA
B)Sarbanes-Oxley Act of 2002
C)Occupational Outlook Handbook
D)Accounting Information System

Question 51

The degree to which information includes data about every relevant object or event necessary to make a decision is

A)accuracy
B)completeness
C)neutrality
D)comparability

Question 52

Historically, the relationship between an information system and an accounting information system has been:

A)the AIS is a part of the IS
B)the IS is a part of the AIS
C)the IS and the AIS are one in the same
D)the IS and AIS are unrelated

Question 53

The three logical components of a business process include all of the following except:

A)management process
B)operations process
C)information process
D)organization process

Question 54

The information quality that enables users to identify similarities and differences in two pieces of information is

A)understandability
B)predictive value and feedback value
C)neutrality
D)comparability

Question 55

Which of the following is an advantage of using cost as a valuation method over fair market value?

A)objectivity
B)reliability
C)verifiability
D)all of the above

Question 56

____ improves the decision maker's capacity to predict, confirm, or correct earlier expectations

A)Understandability
B)Predictive value and feedback value
C)Neutrality
D)Comparability

Question 57

A manmade system that generally consists of an integrated set of computer-based components and manual components established to collect, store, and manage data and to provide output
Information to users.

A)information system
B)output system
C)business event system
D)master data system

Question 58

____ is (are) data presented in a form that is useful to decision makers.

A)Activities
B)Information
C)Objectives
D)Goals

Question 59

A man made system consisting of people, equipment, organization, policies and procedures with the objective of accomplishing the work of the organization.

A)operations process
B)management process
C)information system
D)strategic planning

Question 60

The text takes the following view of the relationship between an IS and an AIS:

A)the AIS is part of the IS
B)the IS is part of the AIS
C)the IS and the AIS are one in the same
D)the AIS is the primary system and the IS the subsystem

Question 61

The central repository for all the data related to the enterprise's business activities and resources.

A)information system
B)management information system
C)enterprise database
D)strategic planning

Question 62

Decision-making is an activity of the

A)management process
B)operations process
C)information process
D)organization process

Question 63

Regarding management problem structure and information requirements, which of the following represents the vertical information flows from lowest to highest?

A)strategic management analysis, tactical management, operations management, operations and business event processing
B)operations and business event processing, strategic management analysis, tactical management, operations management
C)tactical management, operations management, strategic management, operations and business event processing
D)operations and business event processing, operations management, tactical management, strategic management

Question 64

Which of the following is NOT part of the strategic planning process?

A)Who are our customers?
B)What business are we in?
C)Which machinery should we purchase?
D)What is our competitive advantage?

Question 65

Which of the following statements is true?

A)With a more structured decision, there is a need for less accurate information.
B)With a more structured decision there is a need for summarized data.
C)With a more structured decision, there is a need for well defined, more accurate data.
D)With a less structured decision, there is a need for well defined more accurate data.

Question 66

Which of the following is one of the three most prominent management activities?

A)production
B)finance
C)marketing
D)planning

Question 67

At which level of the organization are decisions most unstructured?

A)operations and business event processing level
B)strategic management level
C)operations management level
D)tactical management level

Question 68

____ requires information that focuses on the day to day management of the business.

A)Strategic management
B)Tactical management
C)Operations management
D)Operations and business event processing

Question 69

Which of the following is NOT one of the three steps in decision making as described in the text

A)action orientation
B)intelligence
C)design
D)choice

Question 70

Which of the following is an element of the operations process?

A)production
B)planning
C)controlling
D)decision making

Question 71

If information arrives too late to impact a decision then there is a problem with

A)timeliness
B)relevance
C)completeness
D)neutrality

Question 72

Accounting is an activity of the

A)management process
B)operations process
C)information process
D)organization process

Question 73

The process of selecting the organization's long term objectives such as product lines and profitability is

A)strategic planning
B)tactical planning
C)operations planning
D)operations and business event processing

Question 74

The ability of more than one individual to come to the same measurement is known as

A)accuracy
B)completeness
C)verifiability
D)comparability

Question 75

Which of the following is an unstructured decision?

A)how much inventory to reorder
B)how fast an assembly line should operate
C)when scheduled maintenance should be performed
D)which research and development projects should be undertaken

Question 76

A primary reason that the FASB requires that GAAP be consistently applied from one period to the next is

A)accuracy
B)completeness
C)neutrality
D)comparability

Question 77

Generally, which of the following is NOT one of the three roles an accountant can fill in relation to the AIS?

A)designer
B)programmer
C)user
D)auditor

Question 78

____ requires information to assess the environment and to project future events and conditions.

A)Strategic management
B)Tactical management
C)Operations management
D)Operations and business event processing

Question 79

Which of the following questions might the accountant answer in the design of the AIS?

A)what will be recorded
B)what controls are necessary
C)what reports will be produced
D)all of the above

Question 80

Which of the following statements is false?

A)Strategic planning is relatively unstructured.
B)Strategic planning uses much information from outside the firm.
C)Lower level management must convert strategic plans into plans directed at each operational unit.
D)One of the goals of strategic planning is for individuals and operational units to work toward their own desired objectives.