COMPLETE SOLUTION MANUAL
ACCOUNTING INFORMATION SYSTEMS 2nd EDITION
BY VERNON RICHARDSON (AUTHOR), CHENGYEE CHANG (AUTHOR), ROD
SMITH (AUTHOR)
CHAPTER 1-16 || 4-PART || GRADED A+
,TABLE OF CONTENTS
PART ONE: AIS AND THE BUSINESS
1. ACCOUNTING INFORMATION SYSTEMS AND FIRM VALUE------------------------------------------------------------02
2. ACCOUNTANTS AS BUSINESS---------------------------------------------------------------------------------------------03
3. DATA MODELING----------------------------------------------------------------------------------------------------------04
4. RELATIONAL DATABASES AND ENTERPRISE SYSTEMS------------------------------------------------------------------ 05
PART TWO BUSINESS PROCESSES
5. SALES AND COLLECTIONS BUSINESS PROCESS---------------------------------------------------------------------------06
6. PURCHASE AND PAYMENTS BUSINESS PROCESS------------------------------------------------------------------------07
7. CONVERSION BUSINESS PROCESS-----------------------------------------------------------------------------------------08
8. INTEGRATED PROJECT-------------------------------------------------------------------------------------------------------09
9. DATA ANALYTICS IN ACCOUNTING-----------------------------------------------------------------------------------------10
10. REPORTING PROCESSES AND EXTENSIBLE BUSINESS REPORTING LANGUAGE (XBRL)----------------------------11
PART THREE MANAGING AND EVALUATING AIS PROJECTS
11. ACCOUNTING INFORMATION SYSTEMS AND INTERNAL CONTROLS----------------------------------------------------12
12. INFORMATION SECURITY AND COMPUTER FRAUD---------------------------------------------------------------------13
13. MONITORING AND AUDITING AIS--------------------------------------------------------------------------------------- 14
PART FOUR AIS DEVELOPMENT AND MANAGEMENT
14. THE BALANCED SCORECARD AND BUSINESS VALUE OF INFORMATION TECHNOLOGY----------------------------------------------15
15. EVALUATING AIS INVESTMENTS------------------------------------------------------------------------------------------------------------16
16. THE SYSTEMS DEVELOPMENT LIFE CYCLE AND PROJECT MANAGEMENT: ADDRESSING THE CHALLENGES OF BUILDING AIS
SYSTEMS---------------------------------------------------------------------------------------------------------------------------------------------------------17
,CHAPTER 1 – ACCOUNTING INFORMATION SYSTEMS AND FIRM VALUE
MULTIPLE CHOICE QUESTIONS
1. C
2. D
3. A
4. C
5. D
6. B
7. D
8. A
9. D
10. B
11. B
12. C
13. A
14. C
15. A
DISCUSSION QUESTIONS
1. BRAINSTORM A LIST OF DISCRETIONARY INFORMATION THAT MIGHT BE AN OUTPUT OF AN
ACCOUNTING INFORMATION SYSTEM AND BE NEEDED BY STARBUCKS. PRIORITIZE WHICH
ITEMS MIGHT BE MOST IMPORTANT AND PROVIDE SUPPORT.
ANSWERS WILL VARY. HERE ARE SOME POTENTIAL ANSWERS:
THE COST OF A CUP OF COFFEE, BY TYPE: BREAKFAST BLEND, CAFE ESTIMA, CAFFE VERONA, ESPRESSO
ROAST, ETHIOPIA SIDAMO, FRENCH ROAST, GOLD COAST BLEND, GUATEMALA ANTIGUA, HOUSE BLEND,
ITALIAN ROAST, KENYA COFFEE, KOMODO DRAGON BLEND, ORGANIC SERENA BLEND, ORGANIC SHADE
GROWN MEXICO, SUMATRA, DECAF CAFFE VERONA, DECAF ESPRESSO ROAST, DECAF HOUSE BLEND,
AND DECAF SUMATRA!
MONTHLY SALES PER SQUARE FOOT OF RETAIL SPACE.
EMPLOYEE COST FOR EACH OPERATING HOUR.
ADVERTISING EXPENDITURES PER DOLLAR OF SALES.
THE COST OF CONDIMENTS PER DOLLAR SALES OF COFFEE. CONDIMENTS MIGHT INCLUDE SWEETENERS, LIQUID
CREAMERS, CREAM CANISTERS, SUGAR PACKETS, SUGAR CANISTERS, STIR STICKS!
THE COST OF ELECTRICITY PER OPERATING HOUR EACH MONTH OF THE YEAR.
..
1
, 2. EXPLAIN THE INFORMATION VALUE CHAIN. HOW DO BUSINESS EVENTS TURN INTO DATA THEN INTO
INFORMATION AND THEN INTO KNOWLEDGE? GIVE AN EXAMPLE STARTING WITH THE BUSINESS EVENT
OF THE PURCHASE OF A DVD AT BEST BUY ALL THE WAY TO USEFUL INFORMATION FOR THE CEO AND
OTHER DECISION MAKERS.
THE INFORMATION VALUE CHAIN REPRESENTS THE OVERALL TRANSFORMATION FROM A BUSINESS NEED
AND BUSINESS EVENT (LIKE EACH INDIVIDUAL SALE OF U.S. FLAG) TO AN ULTIMATE DECISION. THE
INFORMATION VALUE CHAIN MIGHT BE REPRESENTED CONSIDERING THE PURCHASE OF A DVD AT BEST
BUY IN THE FOLLOWING WAY:
THE DVD WILL BE RECORDED AS SALES REVENUE AND THEN AFTER DEDUCTING ITS COSTS WILL ADD TO
OR SUBTRACT FROM CORPORATE INCOME. THE CASH FROM THE DVD SALE WILL ALSO ADD TO THE
OPERATING CASH FLOWS.
THE SPECIFIC DVD WILL BE RECORDED IN THE INFORMATION AS A SALE TO MONITOR WHICH DVDS ARE
SELLING WITHIN BEST BUY. THIS WILL HELP BEST BUY AND ITS SUPPLIERS KNOW WHICH DVDS ARE
SELLING AND WHICH TYPE OF DVDS SHOULD BE REORDERED. THE TYPE OF DVD WILL ALSO HELP THE
MARKETING DEPARTMENT BETTER UNDERSTAND ITS CUSTOMERS AND THEIR RESPECTIVE DEMOGRAPHIC
PROFILE TO BETTER MARKET TO THEM.
IN ADDITION, KNOWING THE LOCATION OF THE DVD SALE WILL ALSO HELP DECISION MAKERS KNOW
WHERE ITS SALES ARE OCCURRING.
THE CEO CAN LOOK AT THE PROFITABILITY OF DVDS OVERALL, THE SPECIFIC TYPES OF DVDS THAT ARE
SELLING AND THE LOCATION OF THOSE SALES ALL DUE TO THE INFORMATION VALUE CHAIN.
3. GIVE THREE EXAMPLES OF TYPES OF DISCRETIONARY INFORMATION AT YOUR COLLEGE OR
UNIVERSITY AND EXPLAIN HOW THE BENEFITS OF RECEIVING THAT INFORMATION OUTWEIGH THE
COSTS.
ANSWERS WILL VARY. THIS REPRESENTS A POTENTIAL ANSWER.
UNIVERSITIES ARE OFTEN INTERESTED IN THEIR FRESHMEN RETENTION (THE PERCENTAGE OF
SOPHOMORES THAT RETURN AFTER THEIR FRESHMAN YEAR). THEY ALSO QUITE INTERESTED IN THEIR
FOUR- OR FIVE-YEAR GRADUATION RATES.
UNIVERSITIES ARE ALSO INTERESTED IN THEIR PRODUCTION OF RESEARCH GRANTS. THIS IS OFTEN USED
TO MONITOR THE SUCCESS OF THEIR RESEARCH AND THEIR ABILITY TO GET INTERESTED SPONSORS (SUCH
AS THE NATIONAL INSTITUTE OF HEALTH OR THE NATIONAL SCIENCE FOUNDATION).
INFORMATION FOR EACH OF THESE THREE EXAMPLES CAN BE GAINED BY THE INFORMATION SYSTEM AT
THE UNIVERSITY. HOWEVER, A UNIVERSITY GENERIC INFORMATION SYSTEM DOES NOT USUALLY OFFER
THIS INFORMATION AS A STANDARD REPORT OR STANDARD OUTPUT OF THE SYSTEM. THEREFORE,
WORK MUST BE DONE TO CAPTURE (AND POTENTIALLY DIGITIZE) THIS INFORMATION, ENSURE ITS
VALIDITY AND THEN REPORT IT IN AN APPROPRIATE USEFUL FORMAT. THE COST OF GETTING USEFUL
INFORMATION WILL DEPEND ON THE UNIVERSITY AND ITS TECHNOLOGY. HOWEVER, SINCE THESE
REPRESENT THREE KEYS METRICS OF A UNIVERSITY
..
2
ACCOUNTING INFORMATION SYSTEMS 2nd EDITION
BY VERNON RICHARDSON (AUTHOR), CHENGYEE CHANG (AUTHOR), ROD
SMITH (AUTHOR)
CHAPTER 1-16 || 4-PART || GRADED A+
,TABLE OF CONTENTS
PART ONE: AIS AND THE BUSINESS
1. ACCOUNTING INFORMATION SYSTEMS AND FIRM VALUE------------------------------------------------------------02
2. ACCOUNTANTS AS BUSINESS---------------------------------------------------------------------------------------------03
3. DATA MODELING----------------------------------------------------------------------------------------------------------04
4. RELATIONAL DATABASES AND ENTERPRISE SYSTEMS------------------------------------------------------------------ 05
PART TWO BUSINESS PROCESSES
5. SALES AND COLLECTIONS BUSINESS PROCESS---------------------------------------------------------------------------06
6. PURCHASE AND PAYMENTS BUSINESS PROCESS------------------------------------------------------------------------07
7. CONVERSION BUSINESS PROCESS-----------------------------------------------------------------------------------------08
8. INTEGRATED PROJECT-------------------------------------------------------------------------------------------------------09
9. DATA ANALYTICS IN ACCOUNTING-----------------------------------------------------------------------------------------10
10. REPORTING PROCESSES AND EXTENSIBLE BUSINESS REPORTING LANGUAGE (XBRL)----------------------------11
PART THREE MANAGING AND EVALUATING AIS PROJECTS
11. ACCOUNTING INFORMATION SYSTEMS AND INTERNAL CONTROLS----------------------------------------------------12
12. INFORMATION SECURITY AND COMPUTER FRAUD---------------------------------------------------------------------13
13. MONITORING AND AUDITING AIS--------------------------------------------------------------------------------------- 14
PART FOUR AIS DEVELOPMENT AND MANAGEMENT
14. THE BALANCED SCORECARD AND BUSINESS VALUE OF INFORMATION TECHNOLOGY----------------------------------------------15
15. EVALUATING AIS INVESTMENTS------------------------------------------------------------------------------------------------------------16
16. THE SYSTEMS DEVELOPMENT LIFE CYCLE AND PROJECT MANAGEMENT: ADDRESSING THE CHALLENGES OF BUILDING AIS
SYSTEMS---------------------------------------------------------------------------------------------------------------------------------------------------------17
,CHAPTER 1 – ACCOUNTING INFORMATION SYSTEMS AND FIRM VALUE
MULTIPLE CHOICE QUESTIONS
1. C
2. D
3. A
4. C
5. D
6. B
7. D
8. A
9. D
10. B
11. B
12. C
13. A
14. C
15. A
DISCUSSION QUESTIONS
1. BRAINSTORM A LIST OF DISCRETIONARY INFORMATION THAT MIGHT BE AN OUTPUT OF AN
ACCOUNTING INFORMATION SYSTEM AND BE NEEDED BY STARBUCKS. PRIORITIZE WHICH
ITEMS MIGHT BE MOST IMPORTANT AND PROVIDE SUPPORT.
ANSWERS WILL VARY. HERE ARE SOME POTENTIAL ANSWERS:
THE COST OF A CUP OF COFFEE, BY TYPE: BREAKFAST BLEND, CAFE ESTIMA, CAFFE VERONA, ESPRESSO
ROAST, ETHIOPIA SIDAMO, FRENCH ROAST, GOLD COAST BLEND, GUATEMALA ANTIGUA, HOUSE BLEND,
ITALIAN ROAST, KENYA COFFEE, KOMODO DRAGON BLEND, ORGANIC SERENA BLEND, ORGANIC SHADE
GROWN MEXICO, SUMATRA, DECAF CAFFE VERONA, DECAF ESPRESSO ROAST, DECAF HOUSE BLEND,
AND DECAF SUMATRA!
MONTHLY SALES PER SQUARE FOOT OF RETAIL SPACE.
EMPLOYEE COST FOR EACH OPERATING HOUR.
ADVERTISING EXPENDITURES PER DOLLAR OF SALES.
THE COST OF CONDIMENTS PER DOLLAR SALES OF COFFEE. CONDIMENTS MIGHT INCLUDE SWEETENERS, LIQUID
CREAMERS, CREAM CANISTERS, SUGAR PACKETS, SUGAR CANISTERS, STIR STICKS!
THE COST OF ELECTRICITY PER OPERATING HOUR EACH MONTH OF THE YEAR.
..
1
, 2. EXPLAIN THE INFORMATION VALUE CHAIN. HOW DO BUSINESS EVENTS TURN INTO DATA THEN INTO
INFORMATION AND THEN INTO KNOWLEDGE? GIVE AN EXAMPLE STARTING WITH THE BUSINESS EVENT
OF THE PURCHASE OF A DVD AT BEST BUY ALL THE WAY TO USEFUL INFORMATION FOR THE CEO AND
OTHER DECISION MAKERS.
THE INFORMATION VALUE CHAIN REPRESENTS THE OVERALL TRANSFORMATION FROM A BUSINESS NEED
AND BUSINESS EVENT (LIKE EACH INDIVIDUAL SALE OF U.S. FLAG) TO AN ULTIMATE DECISION. THE
INFORMATION VALUE CHAIN MIGHT BE REPRESENTED CONSIDERING THE PURCHASE OF A DVD AT BEST
BUY IN THE FOLLOWING WAY:
THE DVD WILL BE RECORDED AS SALES REVENUE AND THEN AFTER DEDUCTING ITS COSTS WILL ADD TO
OR SUBTRACT FROM CORPORATE INCOME. THE CASH FROM THE DVD SALE WILL ALSO ADD TO THE
OPERATING CASH FLOWS.
THE SPECIFIC DVD WILL BE RECORDED IN THE INFORMATION AS A SALE TO MONITOR WHICH DVDS ARE
SELLING WITHIN BEST BUY. THIS WILL HELP BEST BUY AND ITS SUPPLIERS KNOW WHICH DVDS ARE
SELLING AND WHICH TYPE OF DVDS SHOULD BE REORDERED. THE TYPE OF DVD WILL ALSO HELP THE
MARKETING DEPARTMENT BETTER UNDERSTAND ITS CUSTOMERS AND THEIR RESPECTIVE DEMOGRAPHIC
PROFILE TO BETTER MARKET TO THEM.
IN ADDITION, KNOWING THE LOCATION OF THE DVD SALE WILL ALSO HELP DECISION MAKERS KNOW
WHERE ITS SALES ARE OCCURRING.
THE CEO CAN LOOK AT THE PROFITABILITY OF DVDS OVERALL, THE SPECIFIC TYPES OF DVDS THAT ARE
SELLING AND THE LOCATION OF THOSE SALES ALL DUE TO THE INFORMATION VALUE CHAIN.
3. GIVE THREE EXAMPLES OF TYPES OF DISCRETIONARY INFORMATION AT YOUR COLLEGE OR
UNIVERSITY AND EXPLAIN HOW THE BENEFITS OF RECEIVING THAT INFORMATION OUTWEIGH THE
COSTS.
ANSWERS WILL VARY. THIS REPRESENTS A POTENTIAL ANSWER.
UNIVERSITIES ARE OFTEN INTERESTED IN THEIR FRESHMEN RETENTION (THE PERCENTAGE OF
SOPHOMORES THAT RETURN AFTER THEIR FRESHMAN YEAR). THEY ALSO QUITE INTERESTED IN THEIR
FOUR- OR FIVE-YEAR GRADUATION RATES.
UNIVERSITIES ARE ALSO INTERESTED IN THEIR PRODUCTION OF RESEARCH GRANTS. THIS IS OFTEN USED
TO MONITOR THE SUCCESS OF THEIR RESEARCH AND THEIR ABILITY TO GET INTERESTED SPONSORS (SUCH
AS THE NATIONAL INSTITUTE OF HEALTH OR THE NATIONAL SCIENCE FOUNDATION).
INFORMATION FOR EACH OF THESE THREE EXAMPLES CAN BE GAINED BY THE INFORMATION SYSTEM AT
THE UNIVERSITY. HOWEVER, A UNIVERSITY GENERIC INFORMATION SYSTEM DOES NOT USUALLY OFFER
THIS INFORMATION AS A STANDARD REPORT OR STANDARD OUTPUT OF THE SYSTEM. THEREFORE,
WORK MUST BE DONE TO CAPTURE (AND POTENTIALLY DIGITIZE) THIS INFORMATION, ENSURE ITS
VALIDITY AND THEN REPORT IT IN AN APPROPRIATE USEFUL FORMAT. THE COST OF GETTING USEFUL
INFORMATION WILL DEPEND ON THE UNIVERSITY AND ITS TECHNOLOGY. HOWEVER, SINCE THESE
REPRESENT THREE KEYS METRICS OF A UNIVERSITY
..
2
