Question 1

A good example of how an AIS is used to share knowledge within an organization is
A)the use of a corporate database to help staff identify the relevant experts who can help with a particular client.
B)the use of tablets to access a network for messaging worldwide.
C)the monitoring of production equipment to watch for defects.
D)the use of point-of-sale data to determine hot-selling items.

Accepted Answer

Option A describes the use of a corporate database to access knowledge about experts within an organization. This is a prime example of how an AIS can be used to share knowledge and expertise within an organization. Options B, C, and D do not involve the use of an AIS to share knowledge within an organization.

Question 2

The American Institute of Certified Public Accountants (AICPA)has recognized the importance of AIS and the major impact information technology has on the area of accounting.To recognize individual CPAs who have met educational and experiential requirements in this area,the group formally created the designation known as
A)the Certified Information Auditor.
B)the Certified Internal Auditor.
C)the Certified Information Technology Professional.
D)the Certified Data Processing Professional.

Accepted Answer

The AICPA has formally created the Certified Information Technology Professional (CITP) designation to recognize individual CPAs who have met educational and experiential requirements in the area of AIS and information technology. The other choices, such as Certified Information Auditor or Certified Data Processing Professional, do not specifically relate to the combination of AIS and information technology in accounting. The Certified Internal Auditor designation, while relevant, is not the specific designation created by the AICPA for this purpose.

Question 3

Which of the following is not one of the components of an AIS?
A)internal controls and security measures
B)people
C)procedures and instructions
D)hardware

Accepted Answer

An Accounting Information System (AIS) primarily focuses on the collection, storage, and processing of financial and accounting data. While hardware is essential for the operation of an AIS, the core components specifically associated with AIS include internal controls and security measures, people, and procedures and instructions. Hardware falls under the broader category of IT infrastructure rather than being a component of AIS itself.

Question 4

When the AIS provides information in a timely and accurate manner,it stands as an example of
A)improved decision making.
B)improving the quality and reducing the costs of products or services.
C)improving efficiency.
D)all of the above

Accepted Answer

When the AIS provides timely and accurate information, it can benefit decision-making, improve product or service quality while reducing costs, and increase efficiency. Therefore, all of the options (A, B, and C) are correct.

Question 5

Identify the components of an accounting information system.

Accepted Answer

The answer of Identify the components of an accounting information...

Question 6

Updating accounts receivable is part of which transaction cycle?
A)Human resources/payroll.
B)Expenditure.
C)Financing.
D)Revenue.

Accepted Answer

Accounts receivable represents money owed to a company by its customers for goods or services sold on credit, thus it is part of the revenue cycle. Updating accounts receivable involves recording and reconciling customer payments and making adjustments for any uncollectible accounts.

Question 7

Many modern accounting software packages offer separate transaction cycle modules.What is the reason for this?
A)Every organization does not need to implement all of the available transaction cycle modules.
B)Most businesses do not need the revenue cycle module as part of their AIS.
C)The nature of a given transaction cycle is the same irrespective of the type of organization.
D)A properly designed AIS does not use the concept of separate business transaction cycles to process transactions.

Accepted Answer

Every organization has unique needs and requirements for their accounting system. Offering separate transaction cycle modules allows businesses to customize their AIS to fit their specific needs and only implement the modules that are applicable to their business processes.

Question 8

An accounting information system must be able to perform which of the following tasks?
A)collect transaction data
B)process transaction data
C)provide adequate controls
D)all of the above

Accepted Answer

An accounting information system must be able to collect transaction data, process transaction data, and provide adequate controls to ensure the accuracy and reliability of financial information. Therefore, all of the above tasks are necessary for an effective accounting information system.

Question 9

A well-designed AIS can improve the decision making in an organization.Identify the statement below that describes a situation where an AIS may actually inhibit effective decision making.
A)An AIS provides to its users an abundance of information without any filtering or condensing of such information.
B)An AIS identifies situations requiring management action.
C)An AIS reduces uncertainty, and therefore accounting information can provide a basis for choosing among alternative courses of action.
D)An AIS provides information about the results of previous decisions which provides decision makers with feedback that can be used in future decision making.

Accepted Answer

Providing too much information without filtering or condensing can overwhelm decision makers and hinder effective decision making. It is important for an AIS to provide relevant information in a concise and understandable manner to support decision making.

Question 10

Who of the following would not be involved in the expenditure cycle?
A)Accounts payable clerk.
B)Receiving clerk.
C)Cashier.
D)Requisition manager.

Accepted Answer

The expenditure cycle involves activities related to the acquisition of and payment for goods and services. The cashier, involved in handling cash transactions, is typically not directly involved in these activities, which are more closely related to purchasing, receiving, and accounts payable functions.

Question 11

How are "Give and Take" transactions classified in business today and what impact does this have on AIS?

Accepted Answer

The answer of How are "Give and Take" transactions classified...

Question 12

Define an accounting information system.

Accepted Answer

The answer of Define an accounting information system....

Question 13

Accounting information plays major roles in managerial decision making by
A)identifying situations requiring management action.
B)reducing uncertainty.
C)providing a basis for choosing among alternative actions.
D)all of the above

Accepted Answer

Accounting information helps managers to identify situations requiring management action, reduce uncertainty, and provide a basis for choosing among alternative actions. Therefore, all of the above choices are correct.

Question 14

Explain what an AIS is,describe the basic tasks it performs in an organization,and give some examples of the types of accounting transactions it processes.

Accepted Answer

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Question 15

An AIS provides value by
A)improving products or services through information that increases quality and reduces costs.
B)providing timely and reliable information to decision makers.
C)creating new products.
D)both A and B

Accepted Answer

An AIS provides value by improving products or services through information that increases quality and reduces costs as well as providing timely and reliable information to decision makers. Both options A and B are correct. While an AIS can potentially support the creation of new products, it is not the primary value provided by an AIS.

Question 16

The AIS must include controls to ensure
A)safety and availability of data.
B)marketing initiatives match corporate goals.
C)information produced from data is accurate.
D)both A and C

Accepted Answer

The AIS must ensure the safety and availability of data, as well as the accuracy of information produced from that data. Marketing initiatives do not necessarily need to be tied to the AIS, so option B is not the best choice.

Question 17

The primary objective of accounting is to
A)implement strong internal controls.
B)provide useful information to decision makers.
C)prepare financial statements.
D)ensure the profitability of an organization.

Accepted Answer

The primary objective of accounting is to provide useful information to decision makers, such as investors and management, in order to facilitate informed decision making. While implementing strong internal controls, preparing financial statements, and ensuring profitability are important functions of accounting, they are not the primary objective.

Question 18

An accounting information system requires at least one computer.

Accepted Answer

An accounting information system (AIS) can be as simple as a manual system using ledgers and books; it does not necessarily require a computer.

Question 19

Why have accounting software packages been designed with separate transaction modules?

Accepted Answer

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Question 20

Which of the following is not an example of a common activity in an AIS?
A)buy and pay for goods and services
B)sell goods and services and collect cash
C)summarize and report results to interested parties
D)record sales calls for marketing purposes

Accepted Answer

Recording sales calls for marketing purposes is not a typical activity within an AIS, as it falls more under the realm of customer relationship management (CRM) systems or call center software. The other activities listed involve transactions and financial reporting, which are core functions of an AIS.

Quiz 1: Conceptual Foundations of Accounting Information Systems

A good example of how an AIS is used to share knowledge within an organization is

Which of the following is not one of the components of an AIS?

When the AIS provides information in a timely and accurate manner,it stands as an example of

Identify the components of an accounting information system.

Updating accounts receivable is part of which transaction cycle?

Many modern accounting software packages offer separate transaction cycle modules.What is the reason for this?

An accounting information system must be able to perform which of the following tasks?

A well-designed AIS can improve the decision making in an organization.Identify the statement below that describes a situation where an AIS may actually inhibit effective decision making.

Who of the following would not be involved in the expenditure cycle?

How are "Give and Take" transactions classified in business today and what impact does this have on AIS?

Define an accounting information system.

Accounting information plays major roles in managerial decision making by

Explain what an AIS is,describe the basic tasks it performs in an organization,and give some examples of the types of accounting transactions it processes.

An AIS provides value by

The AIS must include controls to ensure

The primary objective of accounting is to

An accounting information system requires at least one computer.

Why have accounting software packages been designed with separate transaction modules?

Which of the following is not an example of a common activity in an AIS?