WGU D217 Accounting Information Systems OA Exam |
200 Practice Questions & Detailed Answers | Objective
Assessment Test Bank | A+ Graded
Question 1
Which of the following best defines an Accounting Information System (AIS)?
A) A system that only records financial transactions for tax purposes
B) The entire structure, processes, and technology used to collect, process, store, and report financial
information for decisionmaking
C) A software program used exclusively for payroll processing
D) A manual bookkeeping system that replaces all technology
Correct Answer: B
Rationale: An AIS encompasses the entire structure, processes, and technology used to collect, process,
store, and report financial information. It is not limited to tax purposes, payroll, or manual systems.
Question 2
What is the primary input to the Transaction Processing System (TPS)?
A) Financial statements
B) Business transactions
C) Management reports
D) Budget forecasts
Correct Answer: B
,Rationale: The TPS is the engine of the AIS. Its primary input is business transactions—economic events
that affect the assets and equities of the organization.
Question 3
Which of the following is a problem usually associated with the flatfile approach to data management?
A) Data independence
B) Data redundancy
C) Data integrity
D) Data flexibility
Correct Answer: B
Rationale: The flatfile approach typically suffers from data redundancy (duplication of data), data
inconsistency, and lack of data independence. Data redundancy occurs when the same data is stored in
multiple files.
Question 4
Which flatfile system problem is solved by using a database approach?
A) Data redundancy
B) Taskdata independence
C) Data security
D) Data backup
,Correct Answer: B
Rationale: Taskdata independence is a key problem solved by the database approach. In a database,
data is stored independently of the applications that use it, allowing multiple applications to access the
same data without duplication.
Question 5
What are order entry, manufacturing, procurement, accounts payable, payroll, and human resources
examples of?
A) Financial statements
B) Business cycles or transaction cycles
C) Management reports
D) Internal controls
Correct Answer: B
Rationale: These are examples of business cycles or transaction cycles—the recurring sets of business
activities and related information processing operations associated with processing various types of
transactions.
Question 6
Which department is least likely to be involved in the revenue cycle?
A) Sales
B) Accounts Receivable
, C) Human Resources
D) Shipping
Correct Answer: C
Rationale: The revenue cycle involves sales, accounts receivable, and shipping. Human Resources is
primarily involved in the payroll and HR cycle, not the revenue cycle.
Question 7
What is the goal of data processing in an AIS?
A) To maximize data storage
B) To transform raw data into useful information for decisionmaking
C) To eliminate all manual processes
D) To reduce the number of employees
Correct Answer: B
Rationale: The goal of data processing in an AIS is to transform raw data into useful information that
supports decisionmaking, reporting, and control within the organization.
Question 8
Useful information has which of the following characteristics?
A) Relevance, timeliness, accuracy, completeness, and summarization
200 Practice Questions & Detailed Answers | Objective
Assessment Test Bank | A+ Graded
Question 1
Which of the following best defines an Accounting Information System (AIS)?
A) A system that only records financial transactions for tax purposes
B) The entire structure, processes, and technology used to collect, process, store, and report financial
information for decisionmaking
C) A software program used exclusively for payroll processing
D) A manual bookkeeping system that replaces all technology
Correct Answer: B
Rationale: An AIS encompasses the entire structure, processes, and technology used to collect, process,
store, and report financial information. It is not limited to tax purposes, payroll, or manual systems.
Question 2
What is the primary input to the Transaction Processing System (TPS)?
A) Financial statements
B) Business transactions
C) Management reports
D) Budget forecasts
Correct Answer: B
,Rationale: The TPS is the engine of the AIS. Its primary input is business transactions—economic events
that affect the assets and equities of the organization.
Question 3
Which of the following is a problem usually associated with the flatfile approach to data management?
A) Data independence
B) Data redundancy
C) Data integrity
D) Data flexibility
Correct Answer: B
Rationale: The flatfile approach typically suffers from data redundancy (duplication of data), data
inconsistency, and lack of data independence. Data redundancy occurs when the same data is stored in
multiple files.
Question 4
Which flatfile system problem is solved by using a database approach?
A) Data redundancy
B) Taskdata independence
C) Data security
D) Data backup
,Correct Answer: B
Rationale: Taskdata independence is a key problem solved by the database approach. In a database,
data is stored independently of the applications that use it, allowing multiple applications to access the
same data without duplication.
Question 5
What are order entry, manufacturing, procurement, accounts payable, payroll, and human resources
examples of?
A) Financial statements
B) Business cycles or transaction cycles
C) Management reports
D) Internal controls
Correct Answer: B
Rationale: These are examples of business cycles or transaction cycles—the recurring sets of business
activities and related information processing operations associated with processing various types of
transactions.
Question 6
Which department is least likely to be involved in the revenue cycle?
A) Sales
B) Accounts Receivable
, C) Human Resources
D) Shipping
Correct Answer: C
Rationale: The revenue cycle involves sales, accounts receivable, and shipping. Human Resources is
primarily involved in the payroll and HR cycle, not the revenue cycle.
Question 7
What is the goal of data processing in an AIS?
A) To maximize data storage
B) To transform raw data into useful information for decisionmaking
C) To eliminate all manual processes
D) To reduce the number of employees
Correct Answer: B
Rationale: The goal of data processing in an AIS is to transform raw data into useful information that
supports decisionmaking, reporting, and control within the organization.
Question 8
Useful information has which of the following characteristics?
A) Relevance, timeliness, accuracy, completeness, and summarization
