WGU D217 ACCOUNTING INFORMATION
SYSTEMS OA EXAM 2026
Complete Test BanK | Verified Answers & Rationales
EXAM OVERVIEW
The WGU D217 Accounting Information Systems Objective Assessment
(OA) exam covers key concepts including:
• Transaction Processing Systems (TPS) – Revenue, Expenditure, and
Conversion cycles
• Financial Reporting Systems (FRS) – External reporting to investors,
creditors, tax authorities
• Management Reporting Systems (MRS) – Internal reporting for
managerial decision-making
• Internal Controls – Preventive, detective, and corrective controls;
COSO framework
• Data Management – Database approaches vs. flat-file systems
• Auditing – Internal vs. external audit roles and responsibilities
• Information Security – CIA triad, encryption, access controls
QUESTIONS 1-25
1. The primary input to the transaction processing system (TPS) is:
,A) A nonfinancial transaction
B) An external audit report
C) A financial transaction
D) A budget forecast
Correct Answer: C) A financial transaction
Rationale: The TPS is the engine of the AIS. Its primary input is financial
transactions—economic events that affect a company's assets and equities,
such as a sale or a purchase. Nonfinancial transactions do not directly affect
the accounting records .
2. The major difference between the Financial Reporting System (FRS)
and the Management Reporting System (MRS) lies in their:
A) Processing speed
B) Users
C) Hardware requirements
D) Data storage methods
Correct Answer: B) Users
Rationale: The FRS is designed for external users (investors, tax authorities)
and produces standardized reports like GAAP financials. The MRS is designed
for internal users (managers) and focuses on decision-support information
like variance reports and budgets .
3. The author distinguishes between the accounting information
system and the management information system based on:
A) The technology used
B) Whether the transactions are financial or nonfinancial that directly affect
,the processing of financial transactions
C) The size of the organization
D) The type of reports generated
Correct Answer: B) Whether the transactions are financial or
nonfinancial that directly affect the processing of financial
transactions
Rationale: The AIS captures financial transactions to support revenue,
expenditure, and conversion cycles. The MIS captures nonfinancial
transactions to support marketing, inventory, manufacturing, and human
resources .
4. An example of a financial transaction is:
A) Log of customer calls
B) Customer satisfaction survey
C) Purchase of a computer
D) Employee performance review
Correct Answer: C) Purchase of a computer
Rationale: A financial transaction is an economic event that affects assets and
equities. The purchase of a computer adds an asset to the organization. A log
of customer calls is a nonfinancial transaction .
5. The transaction processing system (TPS) includes which of the
following?
A) The management reporting system
B) The conversion cycle
, C) The financial reporting system
D) The human resource system
Correct Answer: B) The conversion cycle
Rationale: The TPS includes the expenditure cycle, conversion cycle, and
revenue cycle. The conversion cycle records cost accounting and production
activities .
6. The coding scheme most appropriate for a chart of accounts is:
A) Sequential code
B) Block code
C) Mnemonic code
D) Alphabetic code
Correct Answer: B) Block code
Rationale: Block codes allow accounts to be logically grouped in blocks (e.g.,
100-199 Current Assets, 200-299 Fixed Assets). This is ideal for chart of
accounts structure .
7. The most important advantage of sequential coding is that:
A) It conveys meaning without reference to other documents
B) Missing or unrecorded documents can be identified
C) It allows for the insertion of new codes without reorganization
D) It saves recording space
Correct Answer: B) Missing or unrecorded documents can be identified
SYSTEMS OA EXAM 2026
Complete Test BanK | Verified Answers & Rationales
EXAM OVERVIEW
The WGU D217 Accounting Information Systems Objective Assessment
(OA) exam covers key concepts including:
• Transaction Processing Systems (TPS) – Revenue, Expenditure, and
Conversion cycles
• Financial Reporting Systems (FRS) – External reporting to investors,
creditors, tax authorities
• Management Reporting Systems (MRS) – Internal reporting for
managerial decision-making
• Internal Controls – Preventive, detective, and corrective controls;
COSO framework
• Data Management – Database approaches vs. flat-file systems
• Auditing – Internal vs. external audit roles and responsibilities
• Information Security – CIA triad, encryption, access controls
QUESTIONS 1-25
1. The primary input to the transaction processing system (TPS) is:
,A) A nonfinancial transaction
B) An external audit report
C) A financial transaction
D) A budget forecast
Correct Answer: C) A financial transaction
Rationale: The TPS is the engine of the AIS. Its primary input is financial
transactions—economic events that affect a company's assets and equities,
such as a sale or a purchase. Nonfinancial transactions do not directly affect
the accounting records .
2. The major difference between the Financial Reporting System (FRS)
and the Management Reporting System (MRS) lies in their:
A) Processing speed
B) Users
C) Hardware requirements
D) Data storage methods
Correct Answer: B) Users
Rationale: The FRS is designed for external users (investors, tax authorities)
and produces standardized reports like GAAP financials. The MRS is designed
for internal users (managers) and focuses on decision-support information
like variance reports and budgets .
3. The author distinguishes between the accounting information
system and the management information system based on:
A) The technology used
B) Whether the transactions are financial or nonfinancial that directly affect
,the processing of financial transactions
C) The size of the organization
D) The type of reports generated
Correct Answer: B) Whether the transactions are financial or
nonfinancial that directly affect the processing of financial
transactions
Rationale: The AIS captures financial transactions to support revenue,
expenditure, and conversion cycles. The MIS captures nonfinancial
transactions to support marketing, inventory, manufacturing, and human
resources .
4. An example of a financial transaction is:
A) Log of customer calls
B) Customer satisfaction survey
C) Purchase of a computer
D) Employee performance review
Correct Answer: C) Purchase of a computer
Rationale: A financial transaction is an economic event that affects assets and
equities. The purchase of a computer adds an asset to the organization. A log
of customer calls is a nonfinancial transaction .
5. The transaction processing system (TPS) includes which of the
following?
A) The management reporting system
B) The conversion cycle
, C) The financial reporting system
D) The human resource system
Correct Answer: B) The conversion cycle
Rationale: The TPS includes the expenditure cycle, conversion cycle, and
revenue cycle. The conversion cycle records cost accounting and production
activities .
6. The coding scheme most appropriate for a chart of accounts is:
A) Sequential code
B) Block code
C) Mnemonic code
D) Alphabetic code
Correct Answer: B) Block code
Rationale: Block codes allow accounts to be logically grouped in blocks (e.g.,
100-199 Current Assets, 200-299 Fixed Assets). This is ideal for chart of
accounts structure .
7. The most important advantage of sequential coding is that:
A) It conveys meaning without reference to other documents
B) Missing or unrecorded documents can be identified
C) It allows for the insertion of new codes without reorganization
D) It saves recording space
Correct Answer: B) Missing or unrecorded documents can be identified
