Information Systems (2) Flashcards

1
Q

Why is product profitability necessary?

A

As a firm should not only want to know profits or losses being made by each of its products

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2
Q

Why is customer profitability necessary?

A

Some customers or groups of customers are worth more than others

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3
Q

Why are pricing decisions necessary?

A

Accountin info can help analyse how profits and cash flows vary according to price and prospective demand

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4
Q

Why is the value of market share necessary?

A

Firm must be aware of what it is worth to increase market share of one of its products

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5
Q

Why is the shareholder wealth necessary?

A

Future profitability determines the value of a business

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6
Q

Why is cash flow necessary?

A

Loss-making company can survive if it has adequate cash resources, but a profitable company cannot survive unless it has sufficient liquidity

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7
Q

Features of management control information (1)?

A

Commonly expressed in money terms
Collected in a standard manner
Entire organisation
Often quantitative

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8
Q

Features of management control information (2)?

A

Primarily generated internally
Relevant to short and medium terms
Routinely collected and disseminated
Summarised at a relatively low level

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9
Q

Types of information in management controls?

A

Productivity measurement
Budgetary control or variance analysis reports
Cash flow forecasts
Staffing levels
Profit results within a particular department
Labour revenue statistics within a department
Short-term purchasing requirements

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10
Q

What does operational information include a lot of?

A

Transaciton data

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11
Q

What should happen with operational info before converted to management control info?

A

Must be consolidated into totals in management reports before it can be used to prepare management control information

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12
Q

How is operational info often expressed?

A

In terms of units, hours, qunatities of material

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13
Q

How is tactical info often expressed?

A

Expressed in money terms

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14
Q

What is transaction processing system (TPS)?

A

Collects, stores, modifies and retrieves the transactions of an organisation

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15
Q

Two main types of transaction processing?

A

Batch transaction processing
Real time transaction processing

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16
Q

What is meant by batch transaction processing?

A

Collects data as a group and processes it later

17
Q

What is meant by real time transaction processing?

A

Involves immediate processing of data

18
Q

Characteristics of transaction processing system?

A

Controlled processing

Inflexibility

Rapid response

Reliability

19
Q

What is controlled processing?

A

Processing must support an organisation’s operations

20
Q

What is inflexibility?

A

Wants every transaction to be processed in the same way regardless of user or time

21
Q

What is rapid response?

A

Fast performance is critical. Input must become output in seconds

22
Q

What is reliability?

A

Backup and recovery procedures must be quick and accurate