Test 1

Question 1

The value of information can best be determined by
A. its usefulness to decision makers
B. its relevance to decision makers
C. the benefits associated with obtaining the information minus the cost of producing it.
D. the extent to which it optimizes the value chain

Answer 1

C. the benefits associated with obtaining the information minus the cost of producing it.

Question 2

A frantic Barney Rubble lost a large sale because he could not access the sytem to verify the inventory was in stock and ready to be shipped. Which of the following characteristics of useful information is absent in the situation described above?
A. relevant
B. reliable 
C. complete
D. timely
E. understandable
F. verifiable
G accessible

Answer 2

G. accessible

Question 3

Transaction cycles can be summarized on a high level as "give-get" transactions. An example of "give-get" in the revenue be
A. give cash, get goods
B. give goods, get cash
C. Give cash, get labor
D. Give cash, get cash

Answer 3

B. give goods, get cash

Question 4

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

Answer 4

B. provide useful information to decision makers

Question 5

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

Answer 5

D. both A and B

Question 6

the value chain concept is composed of two types of activities known as
A. primary and support
B. primary and secondary
C. support and value
D. technology and support

Answer 6

A. primary and support

Question 7

Source data automation refers to
A. using devices to capture transaction data in machine-readable form at the time the transaction is initiated
B. using the internet as the operating platform of an accounting information system
C. using an accounting information system to electronically bill customers
D. using an accounting information system to automate a previously manual transaction

Answer 7

A. using devices to capture transaction data in machine-readable form at the time the transaction is initiated.

Question 8

The data processing method used by FedEx to track packages is an example of 
A. Real-time processing
B. batch processing
C. online batch processing
D. real-time batch processing

Answer 8

A. real-time processing

Question 9

Pre-numbering of source documents helps to verify that
A. documents have been used in order
B. company policies were followed
C. all transactions have been recorded
D. source data automation was used to capture data

Answer 9

C. all transactions have been recorded

Question 10

documents that are sent to customers or suppliers and then sent back tot he company in the course of a business transaction are known as
A. turnaround documents
B. source documents
C. input documents
D. transaction documents

Answer 10

A. turnaround documents

Question 11

Issuing a purchase order is part of which transaction cycle
A. the revenue cycle
B. the expenditure cycle
C. the human resources cycle
D. the production cycle

Answer 11

B. the expenditure cycle

Question 12

Data must be collected about three facets of each business activity. What are they?
A. the business activity, the resources it affects, the people who participate
B. the business activity, the transactions it creates, the impact on the financial statements
C. the inputs, outputs and processes used
D. who is involved, what was sold, and how much was pad

Answer 12

A. the business activity, the resources it affects, the people who participate

Question 13

Which is a true statement regarding a document flowchart?
A. a document flowchart illustrates the sequence of logical operations performed by a computer
B. A document flowchart is particularly useful in analyzing the adequacy of internal control procedures
C. a document flowchart is more useful than data flow diagram
D. a document flowchart is not normally used in evaluating internal control procedures

Answer 13

B. A document flowchart is particularly useful in analyzing the adequacy of internal control procedures

Question 14

Data flow diagrams depict
A. processes, but not who is performing the processes
B. processed, but not the data that flows between processes.
C. who is performing processes, but not how they perform the process
D. who is performing processes but no the data that flows between processes

Answer 14

A. processes, but not who is performing the processes

Question 15

In the data flow diagram presented in the previous problem, inventory is a 
A. data store
B. data source
C. data flow
D. data source and destination

Answer 15

A. data store

Question 16

The logical view of a database system refers to
A. how a user or programmer conceptually organizes and understands the data
B. how the DBMS accesses data fora . certain application program
C. how and where the data are physically arranged an stored
D. how master files store data values used by more than one application program.

Answer 16

A. how a user or programmer conceptually organizes and understands the data

Question 17

When the human resources manager wants to gather data about salary and start date by employees and by departments, the manager would use which language?
A. data manipulation language
B. data query language
C. data report language
D. data definition language

Answer 17

B. data query language

Question 18

how do users retrieve data stored in a database?
A. by viewing the appropriate data tables
B. by executing a query
C. by performing a search
D. by specifying the primary keys

Answer 18

B. by executing a query

Question 19

in a well structured relational database
A. foreign keys cannot be null
B. there must be at least two foreign keys
C. every column in a row must be single valued
D. one table must be related to all other tables.

Answer 19

C. every column in a row must be single valued

Question 20

identify the aspect of a well structured database that is incorrect.
A. data is consistent
B. redundancy is minimized and controlled
C. all data is stored in one table or relation
D. the primary key of any row in a relation cannot be null.

Answer 20

C. all data is stored in one table or relation

Question 21

identify the statement below that is false with regards to basic requirements of a relational database model.
A. primary keys can be null.
B. Foreign keys if not null, must have values that correspond to the value of a primary key in another table
C. all non key attributes in a table should describe a characteristic about the object identified by the primary key
D. every column in a row must be single-calued

Answer 21

A. primary keys can be null.

Question 22

"cooking the books" is typically accomplished by all of the following except
A. overstating inventory
B. accelerating recognition of revenue
C. inflating accounts payable
D. delaying recording of expenses

Answer 22

C. inflating accounts payable

Question 23

intentional or reckless conduct that results in materially misleading financial statements is called 
A. financial fraud
B. misstatement fraud
C. fraudulent financial reporting
D. audit failure fraud

Answer 23

C. fraudulent financial reporting

Question 24

lapping is best described as the process of
A. applying cash receipts to a different customers account in an attempt to conceal previous thefts of cash receipts.
B. inflating bank balances by transferring money among different bank accounts
C. stealing small amounts of cash, many times over a period of time
D. increasing expenses to conceal that an asset was stolen

Answer 24

A. applying cash receipts to a different customers account in an attempt to conceal previous thefts of cash receipts.

Question 25

Which of the following is not an example of the fraud triangle characteristic concerned with rationalization
A. revenge against the company
B. intent to repay “borrowed” funds in the future
C. sense of entitlement as compensation for receiving a lower than average raise
D. belief that the company won’t suffer because an insurance company will reimburse losses

Answer 25

A. revenge against the company

Question 26

Which characteristic of the fraud triangle often stems from a lack of internal controls within an organization
A. pressure
B. opportunity
C. rationalization
D. concealment

Answer 26

B. opportunity

Question 27

the simplest and most common way to commit a computer fraud is to 
A. alter computer input
B. alter computer output
C. modify the processing
D. corrupt the database

Answer 27

A. alter computer input

Question 28

sequence codes

Answer 28

items are numbered consecutively to account for them so that gaps in the sequence code indicate missing items that should be investigated. Examples of sequence code use are prenumbered checks, invoices, and purchase order

Question 29

block codes

Answer 29

blocks of numbers that are reserved for specific categories of data, thereby helping to organize the data. an example is a chart of accounts

Question 30

group codes

Answer 30

two or more subgroups of digits that are used to code an item. often used in conjunction with block code

Question 31

mnemonic codes

Answer 31

letters and numbers that are interspersed to identify an item. derived from the description of the item and is usually easy to memorize