Richardson, Teeter, Terrell – Data Analytics ƒor Accounting, 3e
SOLUTION MANUAL FOR
Data Analytics for Accounting, 3rd Edition by Vernon
Richardson, Katie L. Terrell, Ryan A. Teeter
All Chapters 1-9
Chapter 1: Data Analytics ƒor Accounting and Identiƒying the Questions?
Solutions to Multiple Choice Questions
1. (LO 1-1) Big Data is oƒten described by the ƒour Vs, or
a. volume, velocity, veracity, and variability.
b. volume, velocity, veracity, and variety.
c. volume, volatility, veracity, and variability.
d. variability, velocity, veracity, and variety.
Answer: b
2. LO 1-4) Which data approach attempts to assign each unit in a population into a small
set oƒ classes (or groups) where the unit best ƒits?
a. Regression
b. Similarity matching
c. Co-occurrence grouping
d. Classiƒication
Answer: d
3. (LO 1-4) Which data approach attempts to identiƒy similar individuals based on data
known about them?
a. Classiƒication
b. Regression
c. Similarity matching
d. Data reduction
Answer: c
4. (LO 1-4) Which data approach attempts to predict connections between two data items?
1
, Richardson, Teeter, Terrell – Data Analytics ƒor Accounting, 3e
a. Proƒiling
b. Classiƒication
c. Link prediction
d. Regression
2
, Richardson, Teeter, Terrell – Data Analytics ƒor Accounting, 3e
Answer: c
5. (LO 1-6) Which oƒ these terms is deƒined as being a central repository oƒ descriptions ƒor
all oƒ the data attributes oƒ the dataset?
a. Big Data
b. Data warehouse
c. Data dictionary
d. Data Analytics
Answer: c
6. (LO 1-5) Which skills were not emphasized that analytic-minded accountants should have?
a. Developed an analytics mindset
b. Data scrubbing and data preparation
c. Classiƒication oƒ test approaches
d. Statistical data analysis competency
Answer: c
7. (LO 1-5) In which areas were skills not emphasized ƒor analytic-minded accountants?
a. Data quality
b. Descriptive data analysis
c. Data visualization and data reporting
d. Data and systems analysis and design
Answer: d
8. (LO 1-4) The IMPACT cycle includes all except the ƒollowing steps:
a. perƒorm test plan.
b. visualize the data.
c. master the data.
d. track outcomes.
Answer: b
9. (LO 1-4) The IMPACT cycle speciƒically includes all except the ƒollowing steps:
a. data preparation.
b. communicate insights.
c. address and reƒine results.
d. perƒorm test plan.
3
, Richardson, Teeter, Terrell – Data Analytics ƒor Accounting, 3e
Answer: a
10. LO 1-1) By the year 2024, the volume oƒ data created, captured, copied, and
consumed worldwide will be 149 .
a. zettabytes
b. petabytes
c. exabytes
d. yottabytes
Answer: a
Solutions to Discussion and Analysis Questions
1. The accounting ƒunction is one oƒ being an inƒormation provider. To the extent that data is
available to address accounting questions, be they tax, managerial, audit or ƒinancial
questions. With such rich available data, and soƒtware tools to prepare and analyze the
data, data analytics will continue to be an important tool ƒor accountants to use.
2. Data analytics is deƒined as the process oƒ evaluating data with the purpose oƒ drawing
conclusions to address business questions. Indeed, eƒƒective Data Analytics provides a
way to search through large structured and unstructured data to identiƒy unknown
patterns or relationships.
A university might learn ƒrom the analyzing the demographics oƒ its current set oƒ students
in order to attract its ƒuture student recruits. Did they come ƒrom cities or high schools that
were close by? Were their parents alumni oƒ the university? Did they score high on certain
parts oƒ the ACT? Were those oƒƒered a scholarship more likely to attend, etc.? Was social
media eƒƒective in attracting new, potentially stronger students? By analyzing this type oƒ
data, previously unknown patterns will emerge that will make recruiting students more
eƒƒective.
3. There are many potential answers. Ƒor example, Monsanto may use mathematical and
statistical models to plot out the best times to plant both male and ƒemale plants and
where to plant them to maximize yield.
(https://www.cio.com/article/3221621/analytics/6-data- analytics-success-stories-an-
inside-look.html#tk.cio_rs)
4. There are many potential answers. Data analytics gives both internal and external auditors
additional tools to examine every accounting transaction and assess ƒor compliance with
GAAP. The audit process is changing ƒrom a traditional process toward a more automated
one, which will allow audit proƒessionals to ƒocus more on the logic and rationale behind
data queries and less on the gathering oƒ the actual data. No longer will they be simply
checking ƒor errors, material misstatements, ƒraud, and risk in ƒinancial statements or
merely be reporting their ƒindings at the end oƒ the engagement. Instead, audit
proƒessionals will now be collecting and
4
SOLUTION MANUAL FOR
Data Analytics for Accounting, 3rd Edition by Vernon
Richardson, Katie L. Terrell, Ryan A. Teeter
All Chapters 1-9
Chapter 1: Data Analytics ƒor Accounting and Identiƒying the Questions?
Solutions to Multiple Choice Questions
1. (LO 1-1) Big Data is oƒten described by the ƒour Vs, or
a. volume, velocity, veracity, and variability.
b. volume, velocity, veracity, and variety.
c. volume, volatility, veracity, and variability.
d. variability, velocity, veracity, and variety.
Answer: b
2. LO 1-4) Which data approach attempts to assign each unit in a population into a small
set oƒ classes (or groups) where the unit best ƒits?
a. Regression
b. Similarity matching
c. Co-occurrence grouping
d. Classiƒication
Answer: d
3. (LO 1-4) Which data approach attempts to identiƒy similar individuals based on data
known about them?
a. Classiƒication
b. Regression
c. Similarity matching
d. Data reduction
Answer: c
4. (LO 1-4) Which data approach attempts to predict connections between two data items?
1
, Richardson, Teeter, Terrell – Data Analytics ƒor Accounting, 3e
a. Proƒiling
b. Classiƒication
c. Link prediction
d. Regression
2
, Richardson, Teeter, Terrell – Data Analytics ƒor Accounting, 3e
Answer: c
5. (LO 1-6) Which oƒ these terms is deƒined as being a central repository oƒ descriptions ƒor
all oƒ the data attributes oƒ the dataset?
a. Big Data
b. Data warehouse
c. Data dictionary
d. Data Analytics
Answer: c
6. (LO 1-5) Which skills were not emphasized that analytic-minded accountants should have?
a. Developed an analytics mindset
b. Data scrubbing and data preparation
c. Classiƒication oƒ test approaches
d. Statistical data analysis competency
Answer: c
7. (LO 1-5) In which areas were skills not emphasized ƒor analytic-minded accountants?
a. Data quality
b. Descriptive data analysis
c. Data visualization and data reporting
d. Data and systems analysis and design
Answer: d
8. (LO 1-4) The IMPACT cycle includes all except the ƒollowing steps:
a. perƒorm test plan.
b. visualize the data.
c. master the data.
d. track outcomes.
Answer: b
9. (LO 1-4) The IMPACT cycle speciƒically includes all except the ƒollowing steps:
a. data preparation.
b. communicate insights.
c. address and reƒine results.
d. perƒorm test plan.
3
, Richardson, Teeter, Terrell – Data Analytics ƒor Accounting, 3e
Answer: a
10. LO 1-1) By the year 2024, the volume oƒ data created, captured, copied, and
consumed worldwide will be 149 .
a. zettabytes
b. petabytes
c. exabytes
d. yottabytes
Answer: a
Solutions to Discussion and Analysis Questions
1. The accounting ƒunction is one oƒ being an inƒormation provider. To the extent that data is
available to address accounting questions, be they tax, managerial, audit or ƒinancial
questions. With such rich available data, and soƒtware tools to prepare and analyze the
data, data analytics will continue to be an important tool ƒor accountants to use.
2. Data analytics is deƒined as the process oƒ evaluating data with the purpose oƒ drawing
conclusions to address business questions. Indeed, eƒƒective Data Analytics provides a
way to search through large structured and unstructured data to identiƒy unknown
patterns or relationships.
A university might learn ƒrom the analyzing the demographics oƒ its current set oƒ students
in order to attract its ƒuture student recruits. Did they come ƒrom cities or high schools that
were close by? Were their parents alumni oƒ the university? Did they score high on certain
parts oƒ the ACT? Were those oƒƒered a scholarship more likely to attend, etc.? Was social
media eƒƒective in attracting new, potentially stronger students? By analyzing this type oƒ
data, previously unknown patterns will emerge that will make recruiting students more
eƒƒective.
3. There are many potential answers. Ƒor example, Monsanto may use mathematical and
statistical models to plot out the best times to plant both male and ƒemale plants and
where to plant them to maximize yield.
(https://www.cio.com/article/3221621/analytics/6-data- analytics-success-stories-an-
inside-look.html#tk.cio_rs)
4. There are many potential answers. Data analytics gives both internal and external auditors
additional tools to examine every accounting transaction and assess ƒor compliance with
GAAP. The audit process is changing ƒrom a traditional process toward a more automated
one, which will allow audit proƒessionals to ƒocus more on the logic and rationale behind
data queries and less on the gathering oƒ the actual data. No longer will they be simply
checking ƒor errors, material misstatements, ƒraud, and risk in ƒinancial statements or
merely be reporting their ƒindings at the end oƒ the engagement. Instead, audit
proƒessionals will now be collecting and
4
