Question 1

SAP ERP's management reporting tools use data in data warehouses.

Accepted Answer

SAP ERP's management reporting tools use data from data warehouses for creating reports and analytics. This allows for better data visualization, analysis, and decision-making.

Question 2

The capability of viewing summary information and then being able to look at details behind the summary is known as data mining.

Accepted Answer

False

Question 3

Activity based costing means keeping track of instances of activities as well as their costs.

Accepted Answer

Activity based costing involves identifying and tracking all activities related to the production of a product or service, and their associated costs. This helps to provide a more accurate view of the costs of producing a product or service, as opposed to traditional costing methods that allocate costs based on a single predetermined factor, such as labor hours or machine usage.

Question 4

In a manufactured item,the cost of heating the plant would be considered part of the item's overhead.

Accepted Answer

Overhead costs include all indirect expenses incurred in the production of a product or service, such as heating the plant, rent, and utilities. These costs are not directly related to the production process but are necessary for the operation of the business.

Question 5

An income statement shows a company's profit or loss in a period.

Accepted Answer

An income statement summarizes a company's revenues, expenses, and net income or loss for a specific period of time, usually a quarter or a year. It shows whether the company made a profit or suffered a loss during that period.

Question 6

When a company has an ERP system the general ledger is maintained by the ERP system.

Accepted Answer

When a company has an ERP system, the general ledger is indeed maintained by the ERP system.

Question 7

An ERP system could have prevented all fraud at Enron.

Accepted Answer

While an ERP system can help establish better internal controls and improve visibility into financial transactions, it cannot prevent all fraud. Fraud requires intentional deception and manipulation and may involve individuals overriding or circumventing established controls. An ERP system can help detect suspicious activity and provide early warning signs, but ultimately requires human intervention and ethical behavior to prevent fraud.

Question 8

Having ERP will let a company use more cost allocation bases.

Accepted Answer

ERP systems provide better visibility and tracking of costs across various departments and functions, allowing companies to identify and use more accurate cost allocation bases.

Question 9

The US Congress passed the Sarbanes-Oxley Act of 2002 in response to the fraud and abuse in the Enron collapse.

Accepted Answer

The Sarbanes-Oxley Act of 2002 was passed by the US Congress in response to the fraud and abuse in the Enron collapse.

Question 10

Using standard costs to accumulate manufacturing costs means that the company does not have to keep track of actual manufacturing costs.

Accepted Answer

Standard costs are predetermined costs that serve as a benchmark for evaluating actual manufacturing costs. Actual costs must still be tracked and compared to the standard costs in order to determine if there are any variances.

Question 11

Activity based costing is a way of treating overhead costs more like direct costs.

Accepted Answer

Activity based costing allocates overhead costs to specific activities and then assigns those costs to products based on the actual usage of those activities. This approach provides a more accurate picture of the true costs of production and allows for better decision making. It essentially treats overhead costs as if they were direct costs, which is why option A is correct.

Question 12

User authorizations help prevent fraud and abuse by employees paying fictitious vendors.

Accepted Answer

User authorizations ensure that only authorized employees have access to financial systems and can make payments, reducing the risk of fraud and abuse by employees paying fictitious vendors.

Question 13

In a manufactured item,the cost of heating the plant would be considered part of the item's raw materials.

Accepted Answer

The cost of heating the plant would be considered a manufacturing overhead cost, not part of the item's raw materials.

Question 14

It's very easy to delete items in the ERP system.

Accepted Answer

The answer of It's very easy to delete items in...

Question 15

When a company has an ERP system it no longer needs a general ledger.

Accepted Answer

An ERP system includes a general ledger as one of its components, but it also has many other modules and features that integrate different areas of the business such as human resources, inventory management, manufacturing, and supply chain management. The general ledger is a critical component in an ERP system as it provides a centralized location to record financial transactions and generate financial statements. Without it, the system would not be able to provide accurate and actionable data for decision-making purposes.

Question 16

In an ERP system,data does not flow from one module to another.

Accepted Answer

Data do not flow from one ERP module to another because they are all in one place -- the database.

Question 17

In SAP ERP access to general ledger accounts is spread over many modules.

Accepted Answer

In SAP ERP, access to general ledger accounts is spread over many modules such as sales and distribution, materials management, production planning, etc. This allows for a comprehensive view of financial data across different business processes.

Question 18

The SAP ERP system has a module called Accounting and Finance.

Accepted Answer

Financial Accounting (FI)

Question 19

Having ERP will require a company to restrict the number of cost allocation bases.

Accepted Answer

ERP systems are flexible and can handle multiple cost allocation bases, allowing companies to tailor their cost accounting practices to their specific needs.

Question 20

In SAP ERP an event's "document flow" can be accessed from any SAP ERP screen.

Accepted Answer

In SAP ERP, an event's "document flow" can be accessed from any screen using the "Document Flow" button or by navigating to the "Related Documents" tab.

Quiz 5: Accounting in ERP Systems