Accounting Information Systems 2nd Edition Richardson Test Bank Chapter 1-15

Accounting Information Systems 2nd Edition Richardson Test Bank (100% VERIFIED) Accounting and Finance is a primary activity in the value chain. Answer: FALSE Diff: 1 Topic: The Value Chain and Accounting Information Systems Learning Objective: 01-04 Describe how business processes affect the firm's value chain. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 2) Accounting Information Systems at this date are all computerized. Answer: FALSE Diff: 1 Topic: Data versus Information Learning Objective: 01-02 Distinguish among data, information, and an information system. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 3) Business value includes all those items, events and interactions that determine the financial health and well-being of the firm. Answer: TRUE Diff: 1 Topic: The Value Chain and Accounting Information Systems Learning Objective: 01-04 Describe how business processes affect the firm's value chain. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 4) The Certified Information Technology Professional (CITP) is a professional designation for those with a broad range of technology knowledge and does not require a CPA. Answer: FALSE Diff: 1 Topic: Role of Accountants in Accounting Information Systems Learning Objective: 01-03 Distinguish the roles of accountants in providing information, and explain certifications related to accounting information systems. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 5) The Certified Information Systems Auditor (CISA) is a professional designation generally sought by those performing IT audits. Answer: TRUE Diff: 1 Topic: Role of Accountants in Accounting Information Systems Learning Objective: 01-03 Distinguish the roles of accountants in providing information, and explain certifications related to accounting information systems. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making Page 1 6) Information is defined as being data organized in a meaningful way that is useful to the user. Answer: TRUE Diff: 1 Topic: Data versus Information Learning Objective: 01-02 Distinguish among data, information, and an information system. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 7) Data is defined as being information organized in a meaningful way that is useful to the user. Answer: FALSE Diff: 1 Topic: Data versus Information Learning Objective: 01-02 Distinguish among data, information, and an information system. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 8) A systems analyst analyzes a business problem that might be addressed by an information system and recommends software or systems to address that problem. Answer: TRUE Diff: 1 Topic: The Value Chain and Accounting Information Systems Learning Objective: 01-04 Describe how business processes affect the firm's value chain. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 9) A value chain is defined as the flow of materials, information, payments, and services from customer to supplier. Answer: FALSE Diff: 1 Topic: The Value Chain and Accounting Information Systems Learning Objective: 01-04 Describe how business processes affect the firm's value chain. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 10) Relevant information is that information that is free from bias and error. Answer: FALSE Diff: 1 Topic: Definition of Accounting Information Systems; Attributes of Useful Information Learning Objective: 01-01 Define an accounting information system, and explain characteristics of useful information. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making Page 2 11) The characteristics of relevant information include predictive value, feedback value and timeliness. Answer: TRUE Diff: 1 Topic: Definition of Accounting Information Systems; Attributes of Useful Information Learning Objective: 01-01 Define an accounting information system, and explain characteristics of useful information. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 12) The characteristics of reliable information are that the information is verifiable, without bias and timely. Answer: FALSE Diff: 1 Topic: Definition of Accounting Information Systems; Attributes of Useful Information Learning Objective: 01-01 Define an accounting information system, and explain characteristics of useful information. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 13) Information overload is defined as the difficulty a person faces in understanding a problem and making a decision as a consequence of too much information. Answer: TRUE Diff: 1 Topic: Definition of Accounting Information Systems; Attributes of Useful Information Learning Objective: 01-02 Distinguish among data, information, and an information system. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 14) The main financial benefit of Customer Relationship Management practices reduces the cost of goods sold. Answer: FALSE Diff: 1 Topic: AIS, Firm Profitability, and Stock Prices Learning Objective: 01-08 Assess the impact of AIS on firm profitability and stock prices. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 15) An efficient Enterprise System can significantly lower the cost of support processes included in sales, general, and administrative expenses. Answer: TRUE Diff: 1 Topic: AIS, Firm Profitability, and Stock Prices Learning Objective: 01-08 Assess the impact of AIS on firm profitability and stock prices. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making Page 3 16) An accounting information system (AIS) is defined as being an information system that records, processes and reports on transactions to provide financial and nonfinancial information for decision making and control. Answer: TRUE Diff: 1 Topic: Definition of Accounting Information Systems Learning Objective: 01-01 Define an accounting information system, and explain characteristics of useful information. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 17) An enterprise system is a centralized database that collects data from throughout the firm. This includes data from orders, customers, sales, inventory and employees. Answer: TRUE Diff: 1 Topic: AIS and Internal Business Processes Learning Objective: 01-06 Describe how AIS assists the firm's internal business processes. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 18) Outbound logistics are the activities associated with receiving and storing raw materials and other partially completed materials, and distributing those materials to manufacturing when and where they are needed. Answer: FALSE Diff: 1 Topic: The Value Chain and Accounting Information Systems Learning Objective: 01-04 Describe how business processes affect the firm's value chain. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 19) Service Activities as defined in the value chain are those activities that provide the support of customers after the products and services are sold to them (e.g. warranty repairs, parts, instruction manuals, etc.). Answer: TRUE Diff: 1 Topic: The Value Chain and Accounting Information Systems Learning Objective: 01-04 Describe how business processes affect the firm's value chain. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 20) A well-designed and well-functioning AIS can be expected to create value by providing relevant information helpful to management to increase revenues and reduce expenses. Answer: TRUE Diff: 1 Topic: AIS, Firm Profitability, and Stock Prices Learning Objective: 01-08 Assess the impact of AIS on firm profitability and stock prices. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making Page 4 21) Production of a 1040 tax form from the AIS to be delivered to the Internal Revenue Service is an example of discretionary information. Answer: FALSE Diff: 1 Topic: Data versus Information Learning Objective: 01-02 Distinguish among data, information, and an information system. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 22) An enterprise system is primarily used to manage and nurture a firm's interactions with its current and potential clients. Answer: FALSE Diff: 1 Topic: AIS and Internal Business Processes Learning Objective: 01-06 Describe how AIS assists the firm's internal business processes. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 23) The Sarbanes-Oxley Act of 2002 is a federal law in the United States that set new and enhanced standards for all U.S. public companies, their management and public accounting firms. Answer: TRUE Diff: 1 Topic: Role of Accountants in Accounting Information Systems Learning Objective: 01-03 Distinguish the roles of accountants in providing information, and explain certifications related to accounting information systems. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 24) CRM software often includes the use of database marketing tools to learn more about the customers and to develop strong firm-to-customer relationships. Answer: TRUE Diff: 1 Topic: AIS and External Business Processes Learning Objective: 01-07 Assess how AIS facilitates the firm's external business processes. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 25) The Certified Information Technology Professional is the position created by the AICPA to recognize CPAs who have the ability to provide skilled professional services on Information Technology. Answer: TRUE Diff: 1 Topic: Data versus Information Learning Objective: 01-03 Distinguish the roles of accountants in providing information, and explain certifications related to accounting information systems. Bloom's: Remember AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making Page 5 26) Accounting information systems: A) Are always computerized. B) Report only accounting information. C) Include records, processes and reports. D) Are for computer games. Answer: C Diff: 2 Topic: Definition of Accounting Information Systems Learning Objective: 01-01 Define an accounting information system, and explain characteristics of useful information. Bloom's: Understand AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 27) Which of the following is not a characteristic of useful information? A) Easy to understand. B) Feedback value. C) Timeliness. D) Representational Faithfulness. Answer: A Diff: 2 Topic: Attributes of Useful Information Learning Objective: 01-01 Define an accounting information system, and explain characteristics of useful information. Bloom's: Understand AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 28) Which of the following are considered to be mandatory information required by a regulatory body? A) Financial reports for the Securities and Exchange Commission. B) The amount of taxes saved by a merger. C) The total dollar value of fireworks that are sold on July 4. D) The cost to build an all-new Starbucks restaurant in Abu Dhabi. Answer: A Diff: 2 Topic: Data versus Information Learning Objective: 01-02 Distinguish among data, information, and an information system. Bloom's: Understand AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 29) The correct order of effects in the value chain are: A) Inbound Logistics → Operations → Service. B) Inbound Logistics → Outbound Logistics → Marketing & Sales. C) Inbound Logistics → Operations → Outbound Logistics. D) Inbound Logistics → Operations → Shipping. Answer: C Diff: 2 Topic: The Value Chain and Accounting Information Systems Learning Objective: 01-04 Describe how business processes affect the firm's value chain. Bloom's: Understand AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making Page 6 30) Which designation would be most appropriate for those professionals possessing IT audit, control and security skills? A) Certified Internal Auditor (CIA). B) Certified Public Accountant (CPA). C) Certified Information Technology Professional (CITP). D) Certified Information Systems Auditors (CISA). Answer: D Diff: 2 Topic: Role of Accountants in Accounting Information Systems Learning Objective: 01-03 Distinguish the roles of accountants in providing information, and explain certifications related to accounting information systems. Bloom's: Understand AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 31) Which designation is for CPAs with a broad range of technology knowledge and experience? A) Certified Internal Auditor (CIA). B) Certified Public Accountant (CPA). C) Certified Information Technology Professional (CITP). D) Certified Information Systems Auditors (CISA). Answer: C Diff: 2 Topic: Role of Accountants in Accounting Information Systems Learning Objective: 01-03 Distinguish the roles of accountants in providing information, and explain certifications related to accounting information systems. Bloom's: Understand AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 32) A supply chain: A) Refers to the supplies needed to build products. B) Refers to the flow of materials, information, payments and services. C) Is similar in function and purpose to the value chain. D) Does not apply to a service firm like an accounting firm. Answer: B Diff: 2 Topic: AIS and External Business Processes Learning Objective: 01-07 Assess how AIS facilitates the firm's external business processes. Bloom's: Understand AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making Page 7 ACCOUNTING INFORMATION SYSTEMS (RICHARDSON 2ND EDITION) 33) A supply chain system does not include information about: A) Current customers. B) Prospective customers. C) Availability of inventory. D) Current suppliers. Answer: B Diff: 2 Topic: AIS and External Business Processes Learning Objective: 01-07 Assess how AIS facilitates the firm's external business processes. Bloom's: Understand AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 34) The income statement line item most likely affected by an AIS investment in enterprise systems would be: A) Revenues. B) Cost of Goods Sold. C) Selling, General and Administrative Expenses. D) Unearned Revenue. Answer: C Diff: 2 Topic: AIS, Firm Profitability, and Stock Prices Learning Objective: 01-08 Assess the impact of AIS on firm profitability and stock prices. Bloom's: Understand AACSB: Reflective Thinking AICPA: BB Industry; FN Decision Making 35) The income statement line item most likely affected by an AIS investment in supply chain that would interface with suppliers would be: A) Revenues. B) Cost of Goods Sold. C) Selling, General and Administrative Expenses. D) Research and Development Expenses.