CHAPTER 2 Overview of Transaction Processing and Enterprise Resource Planning Systems

Question 1

1. Which of the following is NOT a step in the data processing cycle?
   a. data collection
   b. data input
   c. data storage
   d. data processing

Answer 1

a. data collection [Correct. Data collection is a part of data input and is therefore not a
step in the data processing cycle.]

Question 2

2. All of the information (name, GPA, major, etc.) about a particular student is stored in the
same \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_ .
a. file 
b. record 
c. attribute 
d. field

Answer 2

b. record [Correct. A record should include all information maintained by the system
about a particular entity, such as a student.]

Question 3

3. When items are numbered consecutively to account for all of them, and missing ones
cause a gap in the sequence, it is a
a. sequence code. 
b. block code. 
c. group code. 
d. mnemonic code

Answer 3

a. sequence code. [Correct. Items are numbered consecutively to account for all of them,
and missing ones cause a gap in the sequence.]

Question 4

4. Which of the following is most likely to be a general ledger control account?
   a. accounts receivable
   b. petty cash
   c. prepaid rent
   d. retained earnings

Answer 4

a. accounts receivable [Correct. Accounts receivable is typically made up of many individual
customer accounts maintained in a subsidiary ledger. The total of all individual
customer accounts in the subsidiary ledger is maintained in the accounts receivable
control account in the general ledger.]

Question 5

5. Which of the following documents is most likely to be used in the expenditure cycle?
   a. sales order
   b. credit memo
   c. receiving report
   d. job time ticket

Answer 5

c. receiving report [Correct. A receiving report is an expenditure cycle document that
is used to record the receipt of goods from suppliers. Companies pay their suppliers
based on the goods received and recorded on the receiving report.]

Question 6

6. The portion of a data record where the data value for a particular attribute is stored is
called
a. an entity. 
b. an attribute.
c. a field. 
d. a record

Answer 6

c. a field. [Correct. The portion of a data record where the data value for a particular attribute
is stored.]

Question 7

7. How does the chart of accounts list general ledger accounts?
   a. alphabetical order
   b. chronological order
   c. size order
   d. the order in which they appear in financial statements

Answer 7

d. the order in which they appear in financial statements [Correct.]

Question 8

8. Which of the following is NOT an advantage of an ERP system?
   a. better access control
   b. standardization of procedures and reports
   c. improved monitoring capabilities
   d. simplicity and reduced costs

Answer 8

d. simplicity and reduced costs [Correct. ERP systems are quite complex and costly; they
do not offer the advantages of simplicity and reduced costs.]

Question 9

9. Records of company data sent to an external party and then returned to the system as input
are called .
a. turnaround documents 
b. source data automation documents
c. source documents 
d. external input documents

Answer 9

a. turnaround documents [Correct. For example, a utility bill is sent to a customer, who
then returns the bill with payment.]

Question 10

10. What kind of processing involves entering transaction data and editing them as they
occur?
a. Batch processing. 
b. Online batch processing. 
c. Online real-time processing

Answer 10

c. Online real-time processing