Solutions Manual For Accounting Information Systems The Crossroads of
Accounting and IT 2e Donna Kay Ali Ovlia
Active Review ww
1.1 Refer to the chapter opener, Meet Business Intelligence. In your opinion, how can business i
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ntelligence create value using the accounting system?
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Students’ opinion may differ. However, their opinion should include: Increase profitability, impr
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ove customer relationship, increase sales by targeting the right customer category, and in general
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improving all aspects of business activities.
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1.2 Refer to the chapter opener, Meet Business Intelligence. Discuss the importance of sal
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es data in creating business intelligence for an organization.
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Business intelligence allows organization to continuously monitor their sales transaction. By mo
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nitoring sales, enterprise can fine-
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tune other business processes such as purchasing, production, advertising, and customer servic
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e.
1.3 Pick your favorite Accounting Insight from Chapter 1. Discuss why it’s your favorite.
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The answer to this question depends on the student selection and his/her reason for selecting it.
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1.4 What are the modules in the baseline accounting system model? Discuss the purposes and tr
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ansactions associated with each module.
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1 . Vendors. This module encapsulates all data and business processes related to vendors. The tra
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nsactions associated with Vendors module are: Create purchase Order, Receive Items, and Ent
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er Bills.
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2 . Customers. This module encapsulates all data and business processes related to customers. The
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processes associated with Customers module are: Create Invoice, and Receive Customer Pay
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ments.
3 . Employees. This module encapsulates all data and business processes related to employees. Th
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e processes associated with Vendor module are: Enter Time and Calculate Payroll.
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4 . Banking. This module encapsulates all data and business processes related to organization ban
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king. The processes associated with Banking module are: Pay Bills, Make Deposit, Pay Empl
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oyees, and Pay Payroll Liabilities.
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5 . Financials. This module encapsulates all data and business processes related to the organizatio
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n financials. The processes associated with Financial module are: Adjusting Entries, Correcting
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Entries, Closing, and ad-hoc financial activities.
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6 . Reports. This module encapsulates all data and business processes related to the accounting re
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ports. The processes associated with Reports module are: Management Reports, Tax Reports,
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External Financial Reports, and Sustainability Reports.
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1.5 Discuss how the features of a spreadsheet and a database are similar and how they are different.
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A spreadsheet shows rows and columns of a table and that is same as database table’s recor
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ds and fields features. Actually, a spreadsheet row is a record and a column is a field in a
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database table
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1.6 Discuss the potential risks if a company’s accounting system is not well secured.
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Unauthorized access to the accounting data and software could result in valuable information bei
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ng stolen or damaged and virus or other malicious software damage accounting systems softw
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are.
1.7 Discuss the benefits of an integrated enterprise system.
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,An integrated enterprise system allows data to be shared among various enterprise departments.
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For example, an advertising department can use data collected about sales to cluster customers
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into categories and target customers-categories with different adverting methods.
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1.8 Discuss how value chain activities are related to accounting transaction cycles.
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The value chain facilitates coordination of activities with suppliers and customers, including purch
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asing and sales transactions.
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1.9 Discuss the significance of information technology to the accounting professional.
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Today, most accounting systems are computerized systems. These accounting systems are installe
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d on the enterprise computers and used on the enterprise internal networks as well as the Inte
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rnet. To effectively work with computers and use accounting systems, accountants must know
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enough about computers and networks to be able to use computerized accounting systems.
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1.1 0 Discuss problems that enterprises may experience with shadow data.
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Shadow data little or lack of documentation and lack or inadequate security and control are two
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major problems experienced by enterprises.
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Key Terms Check ww ww
d 1. An organizing framework for business process
1.1 1 Match the following terms and definiti
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es, beginning with vendors and ending with custome
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ons. rs
a. enterprise system ww w wh 2. Exchanges or transactions between an enterpris
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b. integrated enterprise system ww ww e and its customers
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c. business processes ww w we 3. Accounting transactions related to specific bus
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d. value chain ww iness processes ww
e. transaction cycles ww w wb 4. Shares data across functional areas within the
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f. purchasing cycle ww wwenterprise
g. payroll cycle ww w w g 5. Transactions with employees
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h. sales cycle ww w wc 6. Related activities performed by an enterprise
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i. baseline accounting system ww ww to create value by transforming input into output
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w wa 7. A system that supports business activities thro
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ughout the enterprise, including inputs, processing, a
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nd outputsww
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wvendors
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wide view of the firm’s accounting system
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, f 1. A module that relates to output from the ac
1.1 2 Match the following terms and definiti
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counting system. ww
ons. w we 2. A module that includes adjusting and correct
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a. vendors module
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b. customers module ww w w a 3. A module related to purchasing goods and services.
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c. employees module ww w wd 4. A module that involves cash received and cash paid.
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d. banking module
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e. financial module
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f. reports module
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g. adjusting entriesww w wm 7. Reports used to evaluate an enterprise’s sus
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h. correcting entriesww tainability performance. ww
i. closing entries
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j. financial reports
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k. tax reports
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l. management reports ww ng decisions.
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m. sustainability reports ww w w j 10. Reports that include a company’s income
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wstatement, balance sheet, and statement of cash flows.
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w wg 11. Entries to bring accounts up to date at year end.
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w wi 12. Zeros out income and expense accounts at
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wwyear end. ww
w w h 13. Entries to correct errors.
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, c 1. A unique identifier for each record.
1.1 3 Match the following terms and definiti
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g 2. An online application that permits users to
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ons. wview data in a multidimensional way.
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a. field w wb 3. A collection of related database fields.
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b. record f 4.Data analytics and predictive modeling used
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c. primary key ww to gain insights from data to improve the quality o
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d. relational database ww f business decisions.
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e. operational database ww w wa 5. A piece of information.
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f. business intelligence
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g. OLAP cubesww o business operations.
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w wd 7. A collection of related database tables.
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g 1. A framework for organizing the complex,
1.1 4 Match the following terms and definiti
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multifaceted undertaking of developing a system.
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ons. w wk 2. Includes testing databases and computer prog
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a. people rams for the new system.
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b. processes w wh 3. Includes scheduling, budgeting, and staffing
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c. technology a project.
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d. information technology (IT) ww ww w w i 4. Includes evaluating new system requirements.
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e. IT architecture
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f. IT infrastructure
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g. system development life cycle (SDLC)
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h. plan wdatabases.
i. analyze w wj 7. Prepare models for business processes and d
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j. design atabases for the new system.
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k. build/buy w wb 8. One of the three keys of opportunity that f
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l. install ocuses on how business activities are impacted.
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m. deploy w wc 9. One of the three keys of opportunity that f
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ocuses on software, hardware, and networks.
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w w a 10. One of the three keys of opportunity that
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wwfocuses on how employees, customers, and vendors
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are impacted.
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w wd 11. Consists of software, hardware, and networ
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k technology used by an organization.
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w wf 12. How specific software, hardware and netwo
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rks are used to build IT architecture for an enterpri
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se.
w we 13. The design or blueprint for an enterprise’s
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winformation technology . ww
Practice Test ww
1.1 5 In addition to accounting systems, which of the following are member of enterprise systems?
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a. SCM and OPS
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b. CRM and SCM
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c. HRM and Financial
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d. SCM, OPS, CRM, and HR (Correct Answer)
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1.1 6 The value chain is useful for:
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a. Coordinating accounting system activities.
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b. Coordinating activities with suppliers and customers (Correct Answer)
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Accounting and IT 2e Donna Kay Ali Ovlia
Active Review ww
1.1 Refer to the chapter opener, Meet Business Intelligence. In your opinion, how can business i
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ntelligence create value using the accounting system?
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Students’ opinion may differ. However, their opinion should include: Increase profitability, impr
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ove customer relationship, increase sales by targeting the right customer category, and in general
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improving all aspects of business activities.
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1.2 Refer to the chapter opener, Meet Business Intelligence. Discuss the importance of sal
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es data in creating business intelligence for an organization.
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Business intelligence allows organization to continuously monitor their sales transaction. By mo
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nitoring sales, enterprise can fine-
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tune other business processes such as purchasing, production, advertising, and customer servic
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e.
1.3 Pick your favorite Accounting Insight from Chapter 1. Discuss why it’s your favorite.
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The answer to this question depends on the student selection and his/her reason for selecting it.
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1.4 What are the modules in the baseline accounting system model? Discuss the purposes and tr
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ansactions associated with each module.
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1 . Vendors. This module encapsulates all data and business processes related to vendors. The tra
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nsactions associated with Vendors module are: Create purchase Order, Receive Items, and Ent
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er Bills.
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2 . Customers. This module encapsulates all data and business processes related to customers. The
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processes associated with Customers module are: Create Invoice, and Receive Customer Pay
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ments.
3 . Employees. This module encapsulates all data and business processes related to employees. Th
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e processes associated with Vendor module are: Enter Time and Calculate Payroll.
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4 . Banking. This module encapsulates all data and business processes related to organization ban
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king. The processes associated with Banking module are: Pay Bills, Make Deposit, Pay Empl
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oyees, and Pay Payroll Liabilities.
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5 . Financials. This module encapsulates all data and business processes related to the organizatio
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n financials. The processes associated with Financial module are: Adjusting Entries, Correcting
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Entries, Closing, and ad-hoc financial activities.
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6 . Reports. This module encapsulates all data and business processes related to the accounting re
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ports. The processes associated with Reports module are: Management Reports, Tax Reports,
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External Financial Reports, and Sustainability Reports.
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1.5 Discuss how the features of a spreadsheet and a database are similar and how they are different.
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A spreadsheet shows rows and columns of a table and that is same as database table’s recor
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ds and fields features. Actually, a spreadsheet row is a record and a column is a field in a
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database table
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1.6 Discuss the potential risks if a company’s accounting system is not well secured.
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Unauthorized access to the accounting data and software could result in valuable information bei
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ng stolen or damaged and virus or other malicious software damage accounting systems softw
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are.
1.7 Discuss the benefits of an integrated enterprise system.
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,An integrated enterprise system allows data to be shared among various enterprise departments.
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For example, an advertising department can use data collected about sales to cluster customers
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into categories and target customers-categories with different adverting methods.
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1.8 Discuss how value chain activities are related to accounting transaction cycles.
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The value chain facilitates coordination of activities with suppliers and customers, including purch
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asing and sales transactions.
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1.9 Discuss the significance of information technology to the accounting professional.
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Today, most accounting systems are computerized systems. These accounting systems are installe
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d on the enterprise computers and used on the enterprise internal networks as well as the Inte
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rnet. To effectively work with computers and use accounting systems, accountants must know
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enough about computers and networks to be able to use computerized accounting systems.
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1.1 0 Discuss problems that enterprises may experience with shadow data.
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Shadow data little or lack of documentation and lack or inadequate security and control are two
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major problems experienced by enterprises.
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Key Terms Check ww ww
d 1. An organizing framework for business process
1.1 1 Match the following terms and definiti
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es, beginning with vendors and ending with custome
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ons. rs
a. enterprise system ww w wh 2. Exchanges or transactions between an enterpris
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b. integrated enterprise system ww ww e and its customers
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c. business processes ww w we 3. Accounting transactions related to specific bus
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d. value chain ww iness processes ww
e. transaction cycles ww w wb 4. Shares data across functional areas within the
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f. purchasing cycle ww wwenterprise
g. payroll cycle ww w w g 5. Transactions with employees
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h. sales cycle ww w wc 6. Related activities performed by an enterprise
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i. baseline accounting system ww ww to create value by transforming input into output
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w wa 7. A system that supports business activities thro
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ughout the enterprise, including inputs, processing, a
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nd outputsww
w wf 8. Transactions related to purchasing items from
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wvendors
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wide view of the firm’s accounting system
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, f 1. A module that relates to output from the ac
1.1 2 Match the following terms and definiti
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counting system. ww
ons. w we 2. A module that includes adjusting and correct
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a. vendors module
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b. customers module ww w w a 3. A module related to purchasing goods and services.
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c. employees module ww w wd 4. A module that involves cash received and cash paid.
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d. banking module
ww w w c 5. A module related to the payroll cycle.
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e. financial module
ww w wb 6. A module related to selling the customer a
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f. reports module
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g. adjusting entriesww w wm 7. Reports used to evaluate an enterprise’s sus
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h. correcting entriesww tainability performance. ww
i. closing entries
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j. financial reports
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k. tax reports
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l. management reports ww ng decisions.
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m. sustainability reports ww w w j 10. Reports that include a company’s income
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wstatement, balance sheet, and statement of cash flows.
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w wg 11. Entries to bring accounts up to date at year end.
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w wi 12. Zeros out income and expense accounts at
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wwyear end. ww
w w h 13. Entries to correct errors.
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, c 1. A unique identifier for each record.
1.1 3 Match the following terms and definiti
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g 2. An online application that permits users to
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ons. wview data in a multidimensional way.
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a. field w wb 3. A collection of related database fields.
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b. record f 4.Data analytics and predictive modeling used
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c. primary key ww to gain insights from data to improve the quality o
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d. relational database ww f business decisions.
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e. operational database ww w wa 5. A piece of information.
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f. business intelligence
ww e 6. A database that stores transactions related t
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g. OLAP cubesww o business operations.
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w wd 7. A collection of related database tables.
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g 1. A framework for organizing the complex,
1.1 4 Match the following terms and definiti
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multifaceted undertaking of developing a system.
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ons. w wk 2. Includes testing databases and computer prog
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a. people rams for the new system.
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b. processes w wh 3. Includes scheduling, budgeting, and staffing
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c. technology a project.
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d. information technology (IT) ww ww w w i 4. Includes evaluating new system requirements.
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e. IT architecture
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f. IT infrastructure
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g. system development life cycle (SDLC)
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h. plan wdatabases.
i. analyze w wj 7. Prepare models for business processes and d
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j. design atabases for the new system.
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k. build/buy w wb 8. One of the three keys of opportunity that f
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l. install ocuses on how business activities are impacted.
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m. deploy w wc 9. One of the three keys of opportunity that f
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ocuses on software, hardware, and networks.
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w w a 10. One of the three keys of opportunity that
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wwfocuses on how employees, customers, and vendors
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are impacted.
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w wd 11. Consists of software, hardware, and networ
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k technology used by an organization.
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w wf 12. How specific software, hardware and netwo
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rks are used to build IT architecture for an enterpri
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se.
w we 13. The design or blueprint for an enterprise’s
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winformation technology . ww
Practice Test ww
1.1 5 In addition to accounting systems, which of the following are member of enterprise systems?
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a. SCM and OPS
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b. CRM and SCM
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c. HRM and Financial
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d. SCM, OPS, CRM, and HR (Correct Answer)
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1.1 6 The value chain is useful for:
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a. Coordinating accounting system activities.
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b. Coordinating activities with suppliers and customers (Correct Answer)
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