Brainscape's Knowledge GenomeTM

Browse over 1 million classes created by top students, professors, publishers, and experts.


See full index

acc 340 > Exam 3 > Flashcards

Exam 3 Flashcards

1
Q

What are the general principles that underlie reporting?

A
  • Necessity for concise reports
  • Emphasis on both physical and monetary measures
  • Frequency of reporting
  • Responsibility reporting
  • Reporting by function
  • Comparative reporting
  • Exception reporting
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Concise Reports

A

Reports that contain only the data that are essential to the performance of the recipient’s duties.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Emphasis of physical and monetary measures

A

A large portion of the information used by managers is nonfinancial.McKinnon and Bruns found that production managers have a compelling preference for the use of physical measures of performance rather than monetary (financial) measures in reports covering short reporting periods.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Frequency of Reporting

A

Often it is assumed that the more frequently data are reported, the better. Among the factors influencing the frequency of reporting are the significance of the data, the nature of the activity being reported on, and the type of data reported (physical vs. monetary).

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Type of data reported (Factor of frequency of reporting)

A

However, the reporting measure used is strongly associated with the optimal length of the reporting period. Production managers
consider physical measures essential in reports that cover a short period of time, but consider financial measures useful in reporting that covers a longer period of time.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
6
Q

Responsibility reporting

A

Responsibility reporting is the process of reporting data to a manager that measure activities over which the manager has some authority and for which the manager is held responsible.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
7
Q

Reporting by Function

A

Different functional areas have different ways of reporting.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
8
Q

Comparative reporting

A

The arranging together of actual data for a current period with either budget data for the current period or actual data for the prior period, thereby facilitating comparison of the data.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
9
Q

Exception reporting

A

The reporting of data reflecting a significant deviance from expected, budgeted, or normal that should be reported to managers.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
10
Q

Selection of records

A

But these criteria are usually limited to account classifications embedded in the account identifier or to the amount of an account balance. Although this does permit some selection of records, it is usually not sufficient for effective exception reporting. Effective exception reporting requires the ability to select records based on the difference between an account’s current balance and its prior year’s balance, or between an account’s actual balance and a budgeted amount.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
11
Q

Some examples of selection of records

A

Sales to customers—actual this quarter compared with budget.
Supplies expense by location—this year compared with last year.
Number of workdays lost due to work-related injuries.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
12
Q

Sequencing of records

A

In spite of an exception reporting being more concise, it still may cover several pages. Frequently, a busy manager will only complete an investigation of some items on the first page. The back-page problems will not receive adequate attention unless they emerge in future reporting periods.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
13
Q

Record sequencing

A

The process of placing data in a specified order.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
14
Q

eXtensible Business Reporting Language (XBRL)

A
  • Greatly enhances the usefulness of accounting information.
  • XBRL is becoming the primary format for financial reporting over the Internet and has been mandated by the Securities and Exchange Commission (SEC) for public companies’ filings of financial statements.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
15
Q

XBRL benefits

A
  • XBRL attaches identity to words and numbers
  • Data can be searched and retrieved and seamlessly imported and exported by different software systems thereby eliminating time-consuming and error-prone manual data entry.
  • You can quickly and easily combine the data into a consolidated report.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
16
Q

XBRL Background

A
  • Note the tag is always in angle brackets, also called diamond brackets or chevrons.
  • All these Web-enabled markup languages are originated from Standard Generalized Markup Language (SGML). SGML was originally designed to enable the sharing of machine-readable documents in large projects in government, law and industry that needed to remain readable for several decades.
  • SGML is XML (eXtensible Markup Language).
  • Extensible simply means users can extend the basic language by defining markup elements themselves thereby making XML much more flexible than SGML.
  • XML is used specifically for Web applications.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
17
Q

XML (eXtensible Markup Language)

A

A markup language used specifically for Web applications. Extensible simply means users can extend the basic language by defining markup elements themselves.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
18
Q

HTML

A

HyperText Markup Language is a markup language that is used to create Web pages.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
19
Q

Explanation of XBRL

A

A markup language derived from XML used for the electronic communication of specifically business and financial data. XBRL attaches an identity to words and numbers.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
20
Q

Tags

A

In XRL, a unique identifier applied to an item of financial data, such as “net profit.” However, a tag is more than a simple identifier. It provides a range of information about the item.

  • we have software tools to help us in preparing tagged XBRL documents.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
21
Q

XBRL Solutions

A
  • The user has to have some understanding of XBRL to use tagging software.
  • There are many software programs that can tag.
  • Many companies offer this service. One example is Workiva , which offers a variety of XBRL related tagging and filing solutions.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
22
Q

SEC Taxonomy

A

The SEC taxonomies are developed based on consortium established taxonomies, and they continue to work together to update these taxonomies.

  • Also called US GAAP
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
23
Q

Taxonomy

A

In XBRL, a dictionary of element names that represent financial reporting concepts (e.g., cash and cash equivalents, accounts receivable, net income) and are established by the XBRL consortium. These taxonomies are used to tag data.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
24
Q

International Financial Reporting Standards, General Purpose (IFRS-GP)

A

is for financial statements using international financial reporting standards.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
25
Q

Instance document

A

An XBRL document that has been tagged according to the rules of XBRL making it available for analysis and processing.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
26
Q

Four steps into creating an instance document

A
  1. Select a standard taxonomy and download this taxonomy into the XBRL software product. Taxonomies are available at no cost at xbrl.sec.gov.
  2. Mark up the data. Assign a specific XBRL tag from the standard taxonomy to each data item in the financial report. If an appropriate tag is not available from the standard taxonomy, the preparer can create a new customized XBRL tag.
  3. Edit the tagging to detect any errors. The XBRL software does this.
  4. Generate the instance document. The XBRL software does this.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
27
Q

Sequence Code

A

Typically, the most simple coding system used by accountants—a numerical code.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
28
Q

Block Coding

A

A complex coding system that assigns meaning to various positions within a code.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
29
Q

Group Code

A

A code that can be used to express significant amounts of information. Most often it is used in a hierarchical structure so that the largest category is identified by the first symbols, followed by increasingly detailed subcategories as you move to the right.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
30
Q

Mnemonic Codes

A

A code that expresses some logical association between the characters forming the code and the item being identified.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
31
Q

Promises of Audit Trails

A

■ the provision of a clear audit trail that is automatic to
■ the enabling of a knowledgeable and diligent computer operator to create an audit trail to
■ the inability of a knowledgeable and diligent computer operator to create an audit trail.

  • Unfortunately, a significant number of packages fall into the last two categories.
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
32
Q

Audit Trail

A

A set of processing references that enables the tracing of an event from its source to its designation or, alternatively, from its designation back to its source. It consists of codes (or references) attached to data as they flow through the accounting system so they can be traced from originating documents, to transaction and open files, and to their inclusion in output reports and documents and vice versa.

  • Be unique and able to trace it
How well did you know this?
1
Not at all
2
3
4
5
Perfectly
33
Q

Reference identifier

A

An identifier that leads an accountant or auditor from a data item’s specific location in the accounting information system to its preceding or successor location.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
34
Q

Horizontal Analysis

A

An analysis where balances for the current financial statements are presented along with balances of prior periods for comparison.

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
35
Q

Common-dollar statement (vertical analysis)

A

A financial statement where each item is shown as a percentage of some base amount designated as 100%. For the balance sheet, the base amount is total assets. For the income statement, the base amount is sales.

36
Q

Vertical analysis

A

Same as common dollar statement

37
Q

What predefined financial formats are accounting software packaged with?

A

The user can (1) adopt these formats as delivered. (2) modify the delivered formats. (3) totally define a set of financial statement formats.

38
Q

The ratios in Industry Norms and Key Business Ratios are published by

A

Dun & Bradstreet Information Services

39
Q

Master account

A

An account that is similar to a control account as the term is conventionally used in accounting.

40
Q

Sub-account

A

An account that is analogous to a subsidiary ledger account.

41
Q

Normal Account

A

An account that has no sub-accounts.

42
Q

Statistical account

A

An account used to accumulate physical instead of monetary data.

43
Q

What does the SFAS 95 do?

A

states a preference for the direct method over the indirect method for creating a cash flow statement,

44
Q

Three types of transaction entries

A
  1. Data captured in and transferred from other processes to the financial process
  2. Transactions originally recorded in the financial process
  3. End-of-period adjustments required in the financial process
45
Q

Transaction entry screen

A

Some accounting software allows the user to enter out-of-balance entries, although a warning is given to the user before they areaccepted. Although some may believe this is a defect, others view it as a desirable feature.

46
Q

Recurring Entry

A

A feature that automates recurring journal entries, such as entries for depreciation, amortization, and accrued liabilities.

47
Q

Possibilities of making an entry

A 
■  The last day of each month
■  The third Wednesday of each month
■  The 5th of each month
■  Every Thursday
■  Five times per year
■  Monthly through, but not beyond, October 31, 2018.
48
Q

Automatic Distribution Entry

A

A feature that automates the distribution of the amount of a transaction to several accounts.

  • Automatic distribution entries (also called “allocation entries”) are essential to efficient data entry in many companies, particularly those in regulated industries that may be required by law to allocate many expenses to many different accounts.
49
Q

Dollar Entry

A

A way to enter monetary data into an accounting information system that saves three keystrokes for data composed of even dollars. The keystrokes to enter $72.00 would be 72.

50
Q

Cents entry

A

A way to enter monetary data into an accounting information system that saves one keystroke (no decimal) for fractional dollar values.

51
Q

Auto-Center

A

A feature that saves keystrokes when entering data that are always represented by a fixed number of characters. After the user enters the characters, the program automatically moves to the next field so the user does not have to press the enter key after entering the field contents.

52
Q

Provisional Posting

A

A feature that applies only when batch posting is used. Transaction files are posted to the general ledger accounts so that provisional financial statements can be printed. If errors are noted, corrections can be made to the transaction files, which are posted again.

53
Q

Inactive Account

A

An account that can no longer receive entries or be adjusted.

54
Q

Soft Closing

A

A closing for interim accounting periods in which entries can still be made in the earlier interim periods.

55
Q

Hard closing

A

Closing for annual accounting periods after which no entries can be made in the period closed.

56
Q

Purposes of revenue process

A

to summarize data and report on the overall financial progress and status of the organization, purposes of the revenue process include not only reporting but also, to a significant degree, the facilitation and control of certain business activities of the organization.

  • Sales process or selling and collection process.
57
Q

How do non profits receive support?

A

Finally, many not-for-profit organizations receive financial support in the form of grants from government agencies, foundations, and corporate sponsors.

58
Q

Collection efforts

A

Collection efforts are not always successful, and organizations extending credit suffer some level of bad debts as part of doing business.

59
Q

Standing Order

A

A purchase order from a customer to a supplier specifying a series of dates and quantities for shipment of goods until notified by the customer to stop.

It is very good, stay at the company if there is a standing order.

60
Q

Backorders

A

Sales orders that cannot be filled because the inventory is depleted.

61
Q

Engagement letter

A

A letter used by public accounting firms that lists the accounting services to be provided, the responsibilities of the accounting firm and the client, the expected end product, and the fees to be charged.

62
Q

Trade credit

A

Credit extended to an organization’s commercial customers.

63
Q

Credit rating

A

A classification of customers by creditworthiness.

64
Q

Credit hold

A

A restriction of additional credit to a customer who has a delinquent balance.

65
Q

Picking list

A

A list that identifies the products and quantities ordered and gives the warehouse location, aisle number, shelf position, bin number, or other reference to the location of the goods.

66
Q

Packing slip (also known as shipping document)

A

A document that accompanies goods in transit.

67
Q

FOB Point

A

The location at which title to the goods changes from the shipper organization to the customer.

68
Q

Cash discount

A

A discount provided to a customer for prompt payment.

69
Q

Dun

A

Delinquency notice sent to past due customer.

70
Q

Balance forward

A

A method of accounting for accounts receivable where receipts are applied to the outstanding balance rather than against particular invoices.

71
Q

Open item

A

A method of accounting for accounts receivable where receipts are correlated with individual invoices, and invoice records remain in the open invoice file until payment is received.

72
Q

Sales allowance

A

A partial reduction of sales revenue because the goods sold to the customer are damaged or defective but the customer chooses to keep the goods.

73
Q

Credit memo

A

A document issued to a customer indicating a reduction of the amount owed.

74
Q

Remittance device

A

A document that shows the invoice or invoices to which a customer’s payment will be applied.

75
Q

Pre-identification (Pre-ID)

A

A method of recording open item receipts on account. You are required to identify the open invoices to which the receipt applies before entering the receipt.

76
Q

Post-identification (Post-ID)

A

A method of recording open item receipts on account. The customer ID and remittance total are entered, then matched with specific open invoices after posting.

77
Q

Open receipt

A

A customer’s payment that has not been designated as being for any particular invoice; therefore, it can be applied to any of the customer’s outstanding invoices.

78
Q

Automatic invoice identification

A

A method for recording open item receipts where payment remittances are entered and the AIS software program matches the remittances with specific open items.

79
Q

Cycle Billing

A

A procedure for billing customers throughout the month by dividing customer accounts into groups and billing each group at a different time during the month.

80
Q

In the following section of a flowchart for a credit sales and cash receipts system, what could symbol × represent?

A

a. separating checks and remittances.
b. enter data.
c. issue transaction file.
d. create credit memo.

B

81
Q

Symbol A most likely represents:

a. remittance advice file.
b. customer master file.
c. general ledger master file.
d. cash disbursements transactions file.

A

general ledger master file

82
Q

Symbol B most likely represents:

a. remittance advices.
b. cash disbursement advices.
c. customer checks.
d. cash receipts transaction file.

A

cash receipts transaction file

83
Q

The customer checks accompanied by the control tape (refer to symbol A) would be:

a. forwarded daily to the billing department for deposit.
b. taken by the mail clerk to the bank for deposit daily.
c. forwarded to the treasurer for deposit daily.
d. accumulated for a week and then forwarded to the treasurer for deposit weekly.

A

forwarded to the treasurer for deposit daily.

84
Q

The appropriate description that should be placed in symbol B would be:

a. keying and verifying.
b. collate remittance advices.
c. batch processing.

A

keying and verifying

85
Q

The next action to take with the customer remittance advices (refer to symbol C) would be to:

a. discard them immediately.
b. file them daily by batch number.
c. forward them to the internal audit department for internal review.
d. forward them to the treasurer to compare with the monthly bank statement.

A

B

86
Q

The appropriate description that should be placed in symbol D would be:

a. attach batch total to report and file.
b. reconcile cash balances.
c. compare batch total and correct as necessary.
d. proof report.

A

C

87
Q

The appropriate description that should be placed in symbol E would be:

A

Accounts receivable master file

acc 340 (3 decks)

Brainscape helps you reach your goals faster, through stronger study habits.
© 2024 Bold Learning Solutions. Terms and Conditions