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Accounting Information Systems, 2e (Kay/Ovlia) Chapter 1 Accounting Systems Insights Objective 1 1) An IT auditor must understand the terms and definitions used by accounting and IT professionals. Answer: T !" #iff: 1 Objective: $1.1 %ow do I navigate the crossroads of accounting and IT& ') (hich of the following are )OT part of the basic functions of an enterprise system& A) %iring *) Output +) Input #) ,rocessing Answer: A #iff: 1 Objective: $1.1 %ow do I navigate the crossroads of accounting and IT& Objective ' 1) A -upply +hain .anagement /-+.) system is a subsystem of an Accounting -ystem. Answer: 0A1-" #iff: 1 Objective: $1.' %ow is the accounting system related to the enterprise system& ') Activities performed by various departments within a company are rarely interconnected. Answer: 0A1-" #iff: 1 Objective: $1.' %ow is the accounting system related to the enterprise system& 2) An integrated enterprise system allows different departments to use the same information. Answer: T !" #iff: 1 Objective: $1.' %ow is the accounting system related to the enterprise system& 3) *usiness processes are related activities performed by an enterprise to create value by transforming input into output. Answer: T !" #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system&

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.atch the following accounting cycles to the appropriate subsystems. A) Operations5,roduction -ystem *) -upply +hain .anagement +) +ustomer elationship .anagement 8) ,urchasing +ycle #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& 9) ,ayroll +ycle #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& :) -ales +ycle #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& Answers: 8) * 9) A :) + .atch the following enterprise system function with the correct definition. A) -ummari;ing information to generate documents and reports *) -orting and storing information +) +apturing information to store in the system <) Input #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& =) Output #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& 1>) ,rocessing #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& Answers: <) + =) A 1>) *

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11) (hen data is ?hard 6eyed? into the program@ which of the following is true& A) +hanging the data reAuires recreating /recording) the entire program. *) +hanging the data reAuires purchasing additional computer storage and may ta6e days or wee6s. +) +hanging the data is cost efficient and may be accomplished in a matter of minutes. #) +hanging the data is costly and may ta6e days or wee6s. Answer: # #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& 1') (hat is an alternative to ?hard 6eyed? data& A) If user reAuirements are correctly defined@ the data will not change and may be ?hard 6eyed.? *) !sing variables in the program@ such as cell addresses in a spreadsheet. +) Alternatives to ?hard 6eyed? data is not possible. All data must be ?hard 6eyed.? #) +reating the program in a way that does not reAuire data. Answer: * #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& 12) The three basic functions of an enterprise system are A) Input@ processing@ and output *) ,rocessing@ output@ and reports +) *usiness intelligence@ processing@ and output #) Input@ data@ and reports Answer: A #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& 13) (hich symbol is used by IT professionals to represent the enterprise networ6& A) +loud *) -tar +) +ircle #) -Auare Answer: A #iff: 1 Objective: $1.' %ow is the accounting system related to the enterprise system& 18) (hat is the purpose of "nterprise esource ,lanning /" ,) software& A) %elp identify the end of a productBs life cycle *) Identify new trends in consumer purchasing +) Analy;e an organi;ationBs sales projections #) %elp managers control organi;ational resources Answer: # #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system&

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19) An accounting system spans which of the following Calue +hain components& A) -upport *) ,urchase +) +ustomers #) All the above e7cept + Answer: # #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& 1:) The Calue +hain begins with which activity& A) -elling items to customers *) +reating the products +) ,urchasing items from vendors #) ,roviding support to customers Answer: + #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& 1<) (hich transactions are related to the purchasing cycle& A) *uying items from vendors *) ,aying employees +) -elling items to customers #) )one of the above Answer: A #iff: 1 Objective: $1.' %ow is the accounting system related to the enterprise system& 1=) (hich transactions are related to the sales cycle& A) ,aying employees *) -elling items to customers +) *uying items from vendors #) )one of the above Answer: * #iff: 1 Objective: $1.' %ow is the accounting system related to the enterprise system& '>) (hat purpose of the processing function of an enterprise system& A) -ummari;e information *) +apture information +) Denerate reports #) -ort and store information Answer: # #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system&

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'1) To obtain a deep understanding of the underlying business of an enterprise system servers@ you need to as6 6ey Auestions. (hat are those Auestions& Answer: E %ow does the enterprise create value& E (hat are its business operations& E (hat are the enterpriseBs business processes for conducting operations& E +an the business processes be streamlined or improved& #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& '') %ow does an enterprise system support people in the same company to perform different but related business activities& ,lease provide an e7ample. Answer: ,eople within a company often need the same information to perform different tas6s. that are often interconnected. An enterprise system allows the information to be shared throughout the company. This ensures the data used to perform the tas6s are the same. The e7ample provided in the te7t is the creation of a paychec6. %uman esources enters personal data and salary information. The accounting department uses that information to generate a paychec6. /-tudents may provide a different e7ample.) #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& '2) 4ou are an intern at a small momEandEpop type corner grocery store. The ownerBs accountant is trying to tal6 the owners into purchasing an integrated enterprise system for small businesses. The owner thin6s the accountant is just trying find a way to charge more money. %ow would you convince the owner each piece of the integrated enterprise system would help the business& Answer: The answer should include the following information. E -upply +hain .anagement: items are automatically removed from inventory and calculations made for reordering from vendors@ identify fast moving items /6eep reordering from vendor ) or slow moving items /consider removing from inventory) E +ustomer elationship .anagement: the purchase is analy;e for trends@ products purchased at a particular time of day and5or day of the wee6@ analy;e for more targeted mar6eting /coupons) E Operations5,roduction -ystem : trac6 items from the meat counter5deli5ba6ery to 6now when to order inputs /flour@ sugar@ various meat products@ etc.) E %uman esources .anagement: trac6 appropriate personnel positions /more5less ba6ers@ more5less butchers@ more5less sales cler6s@ more5less stoc6ers@ etc.) #iff: 2 Objective: $1.' %ow is the accounting system related to the enterprise system&

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'3) 4ou are an accountant and one of your clients is a small business that sells only over the Internet. %ow would you convince the owner to purchase an integrated enterprise system& Answer: The answer should include the following information. E -+.: items are automatically removed from inventory and calculations made for reordering from vendors@ identify fast moving items /6eep reordering from vendor ) or slow moving items /consider removing from inventory) E + .: the purchase is analy;e for trends@ products purchased at a particular time of day and5or day of the wee6@ analy;e for more targeted mar6eting /coupons) E Operations5,roduction -ystem: trac6 shipping supplies E %uman esources ,lanning: trac6 appropriate personnel positions /more5less people for gathering items in the purchase@ more5less people for pac6aging the purchase@ more5less people in the shipping department@ etc.) #iff: 2 Objective: $1.' %ow is the accounting system related to the enterprise system& '8) (hat types of data does a -upply +hain .anagement system and an accounting system need to share& %ow does each system use that data& Answer: A -upply +hain .anagement system and an accounting system would share vendor information /company name@ primary contact@ address@ and phone number)@ items supplied by the vendor@ purchase orders@ delivery dates@ delivery receipt.@ and current raw material inventory levels. /The student may provide additional types of data.) The -upply +hain .anagement system uses this information to order more supplies and verify delivery content. aw material inventory levels are used to calculate when to order more raw materials. The accounting system uses this data to 6now which vendor to pay@ how much to pay the vendor@ and when to pay the vendor. aw material inventory is used in various financial reports. #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& '9) (hat types of data does an operations5production system and an accounting system need to share& %ow does each system use that data& Answer: An operations5production system and an accounting system would share production employee information@ wor6 in process@ and the current level of finished product. /The student may provide additional types of data.) The operations5production system uses the employee information to estimate production capacity. The wor6 in process and current level of finished product issued to calculate needed production rate. The accounting system uses the employee data to run payroll. The wor6 in process and current level of finished product is used in various financial reports. #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system&

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':) 1ist the transaction cycles. (hat type of transactions are in each cycle& Answer: E ,urchasing cycle or Cendor cycleFThis consists of transactions related to purchasing items from vendors@ including suppliers and consultants. E ,ayroll cycle or "7penditure cycleFThis consists of transactions related to employee and payroll. E -ales cycle or evenue cycleFThis consists of transactions between the enterprise and customers. #iff: ' Objective: $1.' %ow is the accounting system related to the enterprise system& Objective 2 1) The Cendors .odule of a baseline accounting system relates to the sales cycle. Answer: 0A1-" #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& ') The +ustomer .odule of a baseline accounting system includes creating purchase orders. Answer: 0A1-" #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 2) The *an6ing .odule of a baseline accounting system includes bill paying transactions. Answer: T !" #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 3) Accounting software often includes a navigation screen that represents the major modules within the accounting system. Answer: T !" #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 8) A database may have two or more tables with the e7act same name. Answer: 0A1-" #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 9) 0inancial accounting focuses on providing accounting information to internal users@ primarily management. Answer: 0A1-" #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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:) An event that does not involve an e7change@ for e7ample accrued interest e7pense@ does not need to be recorded in the accounting system. Answer: 0A1-" #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& <) A primary 6ey may be used to associate customer information /name@ address@ phone number@ etc.) with a sales order. Answer: T !" #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& =) A primary 6ey is a uniAue identifer for a database table. Answer: 0A1-" #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 1>) !nderstanding accounting systems involves seeing the overall system. There is no need to focus on the details. Answer: 0A1-" #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 11) *usiness Intelligence tools use Aueries to e7tract data directly from the relational database@ bypassing the O1A, cube and any accompanying delay. Answer: 0A1-" #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 1') #ata cubes allow you to view data in two dimensions. Answer: 0A1-" #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 12) -tructured $uery 1anguage is used to Auery a relational database. Answer: T !" #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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.atch the following cycles with their corresponding accounting system module. A) +ustomers .odule *) Cendors .odule +) *an6ing .odule #) 0inancial .odule ") "mployees .odule 13) ,ayroll +ycle #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 18) -ales +ycle #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 19) 0inancial +ycle #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 1:) ,urchasing +ycle #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& Answers: 13) " 18) A 19) # 1:) * 1<) (hen loo6ing at an accounting system using the aerial view@ you see A) #etailed information recorded in the accounting system *) Information available on the ta7 reports for the Internal evenue -ervices and other ta7 agencies +) Accounting information available to internal users@ primarily management #) An enterpriseEwide view of an organi;ation showing the entire accounting system Answer: # #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 1=) (hen loo6ing at an accounting system using the ;oom view@ you see A) An enterpriseEwide view of an organi;ation showing the entire accounting system *) Information available on the ta7 reports for the Internal evenue -ervice and other ta7 agencies +) #etailed information recorded in the accounting system #) Accounting information available to internal users@ primarily management Answer: + #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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'>) The Cendors module in the *aseline Accounting -ystem corresponds to which transaction cycle& A) -ales cycle *) 0inancial cycle +) ,ayroll cycle #) ,urchasing cycle Answer: # #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& '1) (hich transactions are usually performed in the +ustomers module of the *aseline Accounting -ystem& A) eceive inventory *) +reate invoice +) +reate purchase order #) ,ay bills Answer: * #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& '') The sales cycle corresponds to which module in the *aseline Accounting -ystem& A) *an6ing *) Cendors +) +ustomers #) "mployees Answer: + #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& '2) (hich event is part of the ,urchasing +ycle& A) ,ay bill *) +reate invoice +) .a6e deposit #) "nter bill Answer: # #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& '3) (hich event is part of the -ales +ycle& A) "nter time *) .a6e deposit +) +reate purchase order #) eceive item Answer: * #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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'8) (hich event is usually performed in the 0inancial modules of the *aseline Accounting -ystem& A) .a6e adjusting entries *) ,ay bills +) "nter time #) +reate income statement Answer: A #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& '9) (hich accounting software is typically used in a midEsi;ed enterprise& A) OracleBs ,eoplesoft "nterprise *) -A, *usiness One +) ,eachtree #) $uic6boo6s "nterprise Answer: # #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& ':) (hat modules comprise a baseline accounting system& A) Cendors@ "mployees@ -ales@ *an6ing@ 0inancial@ and eports *) Inventory@ "mployees@ -ales@ *an6ing@ 0inancial@ and eports +) Inventory@ "mployees@ -ales@ *an6ing@ Accounting@ and eports #) Cendors@ "mployees@ +ustomers@ *an6ing@ 0inancial@ and eports Answer: # #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& '<) To record a payment for inventory delivered@ the information would be entered in a screen that loo6s similar to which paper form& A) -ales receipt *) +hec6 +) Invoice #) ,urchase order Answer: * #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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'=) To record an inventory order@ the information would be entered in a screen that loo6s similar to which paper form& A) -ales receipt *) +hec6 +) Invoice #) ,urchase order Answer: # #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 2>) (hat is the purpose of an onscreen entry form& A) Onscreen entry forms allow you to perform data Analysis that is cumbersome in a relational database. *) Onscreen entry forms provide predictive modeling to gain insights from data to improve business decisions. +) Onscreen entry forms provide a familiar interface for entering information into a database. #) Onscreen entry forms help ensure information is entered only once in the database. Answer: + #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 21) (hich accounting software is designed for a largeEscale company& A) OracleBs ,eople-oft "nterprise *) -A, *usiness AllEInEOne +) OracleBs G# "dwards "nterpriseOne #) -A, *usiness One Answer: A #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 2') (hen designing a database@ which field would )OT belong in a table storing customer information& A) 0irst )ame *) Order )umber +) Hip +ode #) -treet Address Answer: * #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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22) (hen designing a database@ which field would )OT belong in a table storing inventory information& A) +ost *) ,art )umber +) ,urchase Order #) -ale ,rice Answer: + #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 23) A database form is a A) #atabase screen for data input *) #atabase Aueries +) #atabase screen for data output #) #atabase searches Answer: A #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 28) In an accounting system database@ which field belongs in a table containing customer information& A) -treet Address *) +ost +) Item )umber #) Invoice )umber Answer: A #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 29) A spreadsheet can be viewed as A) A database form *) A relational database +) A flat database #) A collection of related tables Answer: + #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 2:) In an accounting system database@ which field belongs in a table containing inventory information& A) Cendor I# *) ,urchase Order +) +ity #) Invoice )umber Answer: A #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&
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2<) The following field names are part of a table for a companyBs inventory. (hich field name could be the primary 6ey for this table& A) -ales ,rices *) +ost +) Item I# #) Cendor I# Answer: + #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 2=) In a relational database@ how are tables connected& A) *y a Auery statement *) *y networ6 addresses +) *y the tables names #) *y fields that are common in two or more tables Answer: # #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 3>) The following fields are common to tables storing customer@ vendor@ and employee information "I+",T A) +ity *) Area +ode +) +ost #) -tate Answer: + #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 31) (hich field below would )OT be stored in an order table& A) +ustomer I# *) Cendor I# +) Order I# #) ItemI# Answer: * #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 3') (hat is the purpose of a database Auery& A) To search the database to answer a specific Auestion *) To connect related tables +) To uniAuely identify a record in a database table #) To provide a format for viewing data Answer: A #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&
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32) (hat is the purpose of *usiness Intelligence Technologies& A) -hadow the accounting system *) -afeguard information +) "7tract data from databases #) 0ind consumer patterns and insights Answer: # #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 33) -preadsheets containing data e7tracted from a relational database are called what& A) -hadow data *) Dhost data +) Dray data #) Intelligent Answer: A #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 38) (hich of the following is )OT considered an information asset& A) -hadow data systems *) *usiness intelligence applications +) "lectronic records #) )one of the above Answer: # #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 39) (hich act reAuires publicly traded companies to assess the effectiveness of their internal controls and have an independent +,A firm audit this assessment& A) -arbanesEO7ley Act of '>>' *) The DAA, Act of 1=2' +) (heat +ommission #) -ecurity "7change +ommission Act of 1=23 Answer: A #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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3:) (hat is the purpose of security and controls over information assets& A) -ecurity and controls are to prevent fraud@ unauthori;ed access@ modification@ destruction@ or disclosure of information assets. *) -ecurity and controls are to prevent data analysis. +) -ecurity and controls are to frustrate employees with legitimate need to access information assets. #) -ecurity and controls are to ensure all the information assets are available to all employees. Answer: A #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 3<) (hat is data mining& A) A type of O1A, cube *) A method for safeguarding information asset +) A business intelligence tool #) All the above e7cept + Answer: + #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 3=) (hich of the following statements about data warehouses is false& A) #ata warehouses store vast amounts of enterprise data. *) #ata warehouses permit e7tensive data analytics to provide business intelligence tools for improved decision Auality. +) #ata warehouses store current and historical data. #) #ata warehouses are not considered an information asset and do not need to be safeguarded. Answer: # #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 8>) (hat is the difference between the aerial view and ;oom view of an accounting system& Answer: The aerial view of an accounting system is the enterpriseEwide view of a company showing a global view of the entire accounting system and how information flows through the enterprise. 0or e7ample@ the aerial view allows an account to see how employee information entered in the %uman esource .anagement is used in operations5productions system and the accounting system. /The student my provide a different e7ample.) The ;oom view of accounting focuses on /drills down) specific detailed information@ events@ and transactions recorded in the accounting system. 0or e7ample@ closing entries. /The student may provide a different e7ample.) #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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81) Identify the si7 modules in the baseline accounting system. (hich transaction cycle is associated with each module& (hat type of transactions are associated with each module& Answer: E Cendor module F consists of transactions with vendorsJ this module relates to the purchasing cycle. E +ustomer module F consists of transactions with customersJ this module relates to the sales cycle. E "mployee module F consists of transactions with employees for payrollJ this module relates to the payroll cycle. E *an6ing module F involves cash received /deposits) and cash paid /chec6s5withdrawals) with the enterpriseBs ban6J this modules does not relate to a transaction cycle. E 0inancial module F consists of other transactions that are not part of the other modulesJ for e7ample@ adjusting entries@ correcting entries@ and closing entriesJ this module relates to the financial cycle. E eports module F consists of output from the Accounting system /hard copies and soft copies)J for e7ample financial reports@ ta7 reports@ and management reportsJ this module does not relate to a transaction cycle. #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 8') If you were the person entering transactions into an accounting system@ why would you want the input screens to loo6 li6e paper forms& Answer: Input screens that mirror paper forms provide a familiar interface for entering data. This reduces the amount of time needed to learn how to enter data and learn the system. The familiarity also helps the user to become comfortable with the system. #iff: 1 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 82) (hat are the three database essentials an accounting professional needs to 6now& #efine and provide an e7ample of each. Answer: 0ield E A piece of information about events@ people@ or objects. "7ample@ phone number. /The student may provide a different e7ample. ecord E A collection of related fields. "7ample@ customer I#@ first name@ last name@ street address@ city@ state@ ;ip code@ area code@ and phone number. /The student may provide a different e7ample.) Table E A collection of related records with a uniAue table name. 0or e7ample@ +ustomer. / The student may provide a different e7ample.) #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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83) (hat are #atabase 0orms@ #atabase $ueries@ and #atabase eports& ,lease provide an e7ample of each. Answer: E #atabase 0ormEThese are used to input data into the database. "7amples are onscreen chec6s and onscreen invoices. /The student may provide different e7amples.) E #atabase $ueriesEThese are Auestions. #atabase Aueries search the database to answer a specific Auestion and e7tract a specific piece of information from one or more tables. 0or e7ample@ you could Auery the database to search on the ;ip field using the criteria of ;ip K 83=11. /The student may provide different e7amples.) E #atabase eportsE#atabase reports provide a format for viewing the results of your Auery. 4ou can usually view a report onscreen or print out a copy of a report. 0or e7ample@ a report displays the results of a Auery for all the e7pense account balances for '>1'. /The student may provide different e7amples.) #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 88) (hat is the purpose of a primary 6ey& (hat would happen if a relational database was designed without any primary 6eys& Answer: The purpose of a primary 6ey is to provide a uniAue identifer for each record in a relational database. If a relational database was designed without any primary 6eys E the same information may be entered multiple times in the database E it would be difficult /maybe even impossible) to connect related tables E data retrieved may be out of date and inaccurate #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 89) 4ou are hired by a consulting company to assist in creating an accounting system for a company that sells e7clusively online. 1ist the fields needed for the +ustomer table and the Inventory table. Identify the primary 6ey in each table. Answer: +ustomer table: +ustomer I# /primary 6ey)@ 0irst )ame@ 1ast )ame@ -treet Address@ +ity@ -tate@ HI, +ode@ +ell Area +ode@ +ell ,hone@ %ome Area +ode@ %ome ,hone )umber@ (or6 Area +ode@ (or6 ,hone )umber@ "mail Address@ +ontact ,reference /The student may have additional fields.) Inventory table: Item )umber /primary 6ey)@ Item )ame@ ,rimary Cendor I#@ -econdary Cendor I#@ +ost@ -ale Amount@ Amount On %and@ Amount On Order@ (arehouse I#@ 1ocation in (arehouse /The student may have additional fields.) #iff: 2 Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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8:) %ow are database tables connected in a relational database& %ow does this help prevent entering data multiple times& ,lease provide an e7ample. Answer: #atabase tables in a relational database are connected by fields that are common to two or more tables. The common field is usually the primary 6ey for one of the tables. This connection helps prevent entering data multiple times by associating data in one table with data in another table. 0or e7ample@ customer information is usually stored in a table /+ustomer) with a primary 6ey /+ustomer I#) and sales order /Order) information are stored in another table with a primary 6ey /Order )O). *y including a field for +ustomer I# in the Order table@ the Order table and +ustomer table are connected. /The student may provide a different e7ample.) #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 8<) %ow can data in an accounting information system improve decision ma6ing& ,rovide e7amples of these decisions. Answer: #ata in an accounting information system can improve decision ma6ing by being transformed into information. (ith further analysis@ that information is transformed in to business intelligence. *usiness intelligence can help a business predict what type of new product customers will buy ne7t year and5or what type of e7isting product customers will stop buying ne7t year. It can help a business increase sales and reduce returns. *usiness intelligence can help investors decide if they should invest in the company or sell any e7isting investments in company. *usiness intelligence can help ban6s decide if they should loan the company money. #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 8=) (hat is the difference between data@ information@ and business intelligence& Answer: #ata is an individual piece of a larger entity. 0or e7ample@ the amount of a customerBs purchase is data. An individual piece of data is generally not helpful in ma6ing business decisions. Information is a collection of related data. 0or e7ample@ an income statement. Information provides details about what occurred in the past. *usiness intelligence is an analysis of related information. 0or e7ample@ financial analytics and predictive modeling. *usiness intelligence helps decision ma6ers ma6e various predictions such as what customers will buy ne7t year. #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT&

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9>) (hat are the three vital functions an accounting system servers& ,lease define each. Answer: 1. -torage of accounting transactions and financial data. The accounting transactions that result from the operations of the business are typically stored in a relational database. -ometimes the relational database that stores operational transactions is referred to as an operational database. '. *usiness intelligence and financial analytics for decision ma6ing. *usiness intelligence employs data analytics and predictive modeling to gain insights from data to improve the Auality of business decisions. 2. -afeguarding information assets. One of the functions of the accounting system is to have appropriate security and controls to safeguard the information assets that it contains. #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 91) (hat are the advantages and disadvantages of using a shadow data system& Answer: Advantages E "asier to perform analysis using spreadsheets E )o need to depend on IT staff to program and run necessary Aueries #isadvantages E -preadsheets have very little documentationJ therefore@ when the individual who created it leaves@ the spreadsheet is abandoned or must be recreated E -preadsheets may have inadeAuate on none7istent security to prevent unauthori;ed access #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& 9') (hat may be classified as an information asset& ,lease provide an e7ample. Answer: #ata contained in the information system. 0or e7ample@ electronic records@ files@ and databases. Information technology which is defined as hardware such as computers@ servers@ routers@ 6eyboards@ and monitors /the student may list other hardware) and software such as firewalls@ applications@ analysis tools /the student may list other software). #iff: ' Objective: $1.2 (hat are the secrets of my success at the crossroads of accounting and IT& Objective 3 1) ,rocesses are related activities or events that create value. Answer: T !" #iff: 1 Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT& ') An IT audit includes auditing the -ystem #evelopment 1ife +ycle /-#1+). Answer: T !" #iff: 1 Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT&

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2) (hat are the three 6ey factors to consider for a successful accounting system& A) ,eople@ budget@ and time *) Time@ processes@ and technology +) ,eople@ processes@ and technology #) ,rocesses@ budget@ and time Answer: + #iff: ' Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT& 3) (hich of the following agents is internal to a company& A) +ustomer *) "mployee +) Cendor #) Investor Answer: * #iff: 1 Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT& 8) I0 - is an acronym for A) Integrated 0inancial eporting -ervices *) International 0inancial eporting -tandards +) Integrated 0ederal ecording -tandards #) International 0inancial egulated -ervices Answer: * #iff: ' Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT& 9) (hich of the following processes are performed in the #esigning ,hase of the -#1+& A) Identify the new business processes *) Install the new system +) Test the new system #) Identify the new reAuirements for the system Answer: A #iff: ' Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT& :) The staffing process occurs in which phase of the -#1+& A) *uild5*uy ,hase *) #eploy ,hase +) Analy;e ,hase #) ,lan ,hase Answer: # #iff: ' Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT&

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<) Analy;ing the impact an accounting system will have on people should occur in which phase of the -#1+& A) #eploy *) #esign +) Analy;e #) ,lanning Answer: + #iff: 1 Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT& =) IT LLLLLLLL is the design or blueprint for an enterpriseBs information technology. A) Technology *) Infrastructures +) )etwor6 #) Architecture Answer: # #iff: 1 Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT& 1>) Identify the people involved in an accounting system. (hat type of transactions do they generate& Answer: Cendors E ,urchase transactions resulting from when an enterprise purchases goods and services from vendors +ustomers E -ales transactions related to an enterprise selling goods and services to customers "mployees E ,ayroll transactions related to processing payments to employees and governmental agencies #iff: ' Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT& 11) (hat are the si7 main phases in the -ystem #evelopment 1ife +ycle. (hat happens in each phase& Answer: ,lan the system project including scheduling@ budgeting@ and staffing. Analy;e the new system reAuirements@ such as what reports are reAuired and what data needs to be collected by the system. #esign business processes and databases for the new system. *uild5buy and test databases and computer programs for the new system. Install new IT hardware@ software@ and databases. #eploy the new system@ using the system on an ongoing basis and maintaining and updating it as necessary. #iff: 2 Objective: $1.3 (hat are three 6eys to opportunity at the crossroads of accounting and IT&

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