[TEST BANK]
ACCOUNTING
INFORMATION SYSTEMS,
15THEDITION BY ROMNEY,
STEINBART, SUMMERS,
WOOD
, Chapter 1 Accounting Information Systems: An Overview
1.1 Distinguish data from information, discuss the characteristics of useful information,
andexplain how to determine the value of information.
1) Which of the following statements below shows the contrast between
data and information?
A) Data is the output of an AIS.
B) Information is the primary output of an AIS.
C) Data is more useful in decision making than information.
D) Data and information are the same.
Answer: B
2) Information is best described as
A) Raw facts about transactions.
B) Data that has been organized and processed so that it is meaningful to the user.
C) Facts that are useful when processed in a timely manner.
D) The same thing as data.
Answer: B
3) The value of information can best be determined by
A) Its usefulness to decision makers.
B) Its relevance to decision makers.
C) The benefits associated with obtaining the information minus the cost of producing it.
D) The extent to which it optimizes the value chain.
Answer: C
4) An accounting information system (AIS) processes to provide users with
.
A) data; information
B) data; transactions
C) information; data
D) data;
benefitsAnswer:
A
5) Information reduces uncertainty, improves decision makers' ability to
make predictions, or confirms expectations.
A) Timely
1
,B) Reliable
C) Relevant
D) Complete
Answer: C
6) Information that is free from error or bias and accurately represents the events or
activitiesof the organization is
A) Relevant.
B) Reliable / Faithful Representation.
C) Verifiable.
D) Timely.
Answer: B
7) Information that does not omit important aspects of the underlying events or
activitiesthat it measures is
A) Complete.
B) Accessible.
C) Relevant.
D) Timely.
Answer: A
8) Information is when two knowledgeable people independently produce
thesame information.
A) verifiable
B) relevant
C) reliable
D) complete
Answer: A
9) Data must be converted into information to be considered useful and meaningful
for decision making. There are six characteristics that make information both useful
and meaningful. If information is free from error or bias and accurately represents
the events oractivities of the organization, it is representative of the characteristic of
A) Relevancy.
B) Timeliness.
C) Understandability.
D) Reliability.
2
, Answer: D
10) Inventory information is provided in real time by a firm's accounting information
system. The accuracy of this information is questionable, however, since the
production manager often reports stock outs of components that the system
indicates are in stock. Which of the following characteristics of useful information is
absent in the situation described above?
A) relevant
B) reliable
C) complete
D) timely
E) understandable
F) verifiable
G) accessible
Answer: B
11) Cheryl Metrejean has been the controller of Downtown Tires for 25 years.
Ownership of the firm recently changed hands and the new owners are conducting an
audit of the financial records. The audit has been unable to reproduce financial reports
that were prepared by Ms. Metrejean. While there is no evidence of wrongdoing, the
auditors are concerned that the discrepancies might contribute to poor decisions.
Which of the following characteristics of useful information is absent in the situation
described above?
A) relevant
B) reliable
C) complete
D) timely
E) understandable
F) verifiable
G) accessible
Answer: F
12) In 2003, Singh Manufacturing implemented a Web-based information system that
allows all employees to access mission-critical information. The intention was to
increase production efficiency. Unfortunately, it had the opposite effect, as deliveries
fell behind schedule and costs increased. Shaman Gupta, the director of information
technology services, asked Ashlee Wells to come in and talk with him about the
system. Ashlee is a long-time employee of Singh, and her opinion is valued by her
peers and by her supervisor.
"So Ashlee, how's it going down there in the shop?"
"Not so good, Shaman. Used to be we got a weekly pick list so we knew how to plan
production. Now, we got that computer system. Most of us can't figure out how to use
3
ACCOUNTING
INFORMATION SYSTEMS,
15THEDITION BY ROMNEY,
STEINBART, SUMMERS,
WOOD
, Chapter 1 Accounting Information Systems: An Overview
1.1 Distinguish data from information, discuss the characteristics of useful information,
andexplain how to determine the value of information.
1) Which of the following statements below shows the contrast between
data and information?
A) Data is the output of an AIS.
B) Information is the primary output of an AIS.
C) Data is more useful in decision making than information.
D) Data and information are the same.
Answer: B
2) Information is best described as
A) Raw facts about transactions.
B) Data that has been organized and processed so that it is meaningful to the user.
C) Facts that are useful when processed in a timely manner.
D) The same thing as data.
Answer: B
3) The value of information can best be determined by
A) Its usefulness to decision makers.
B) Its relevance to decision makers.
C) The benefits associated with obtaining the information minus the cost of producing it.
D) The extent to which it optimizes the value chain.
Answer: C
4) An accounting information system (AIS) processes to provide users with
.
A) data; information
B) data; transactions
C) information; data
D) data;
benefitsAnswer:
A
5) Information reduces uncertainty, improves decision makers' ability to
make predictions, or confirms expectations.
A) Timely
1
,B) Reliable
C) Relevant
D) Complete
Answer: C
6) Information that is free from error or bias and accurately represents the events or
activitiesof the organization is
A) Relevant.
B) Reliable / Faithful Representation.
C) Verifiable.
D) Timely.
Answer: B
7) Information that does not omit important aspects of the underlying events or
activitiesthat it measures is
A) Complete.
B) Accessible.
C) Relevant.
D) Timely.
Answer: A
8) Information is when two knowledgeable people independently produce
thesame information.
A) verifiable
B) relevant
C) reliable
D) complete
Answer: A
9) Data must be converted into information to be considered useful and meaningful
for decision making. There are six characteristics that make information both useful
and meaningful. If information is free from error or bias and accurately represents
the events oractivities of the organization, it is representative of the characteristic of
A) Relevancy.
B) Timeliness.
C) Understandability.
D) Reliability.
2
, Answer: D
10) Inventory information is provided in real time by a firm's accounting information
system. The accuracy of this information is questionable, however, since the
production manager often reports stock outs of components that the system
indicates are in stock. Which of the following characteristics of useful information is
absent in the situation described above?
A) relevant
B) reliable
C) complete
D) timely
E) understandable
F) verifiable
G) accessible
Answer: B
11) Cheryl Metrejean has been the controller of Downtown Tires for 25 years.
Ownership of the firm recently changed hands and the new owners are conducting an
audit of the financial records. The audit has been unable to reproduce financial reports
that were prepared by Ms. Metrejean. While there is no evidence of wrongdoing, the
auditors are concerned that the discrepancies might contribute to poor decisions.
Which of the following characteristics of useful information is absent in the situation
described above?
A) relevant
B) reliable
C) complete
D) timely
E) understandable
F) verifiable
G) accessible
Answer: F
12) In 2003, Singh Manufacturing implemented a Web-based information system that
allows all employees to access mission-critical information. The intention was to
increase production efficiency. Unfortunately, it had the opposite effect, as deliveries
fell behind schedule and costs increased. Shaman Gupta, the director of information
technology services, asked Ashlee Wells to come in and talk with him about the
system. Ashlee is a long-time employee of Singh, and her opinion is valued by her
peers and by her supervisor.
"So Ashlee, how's it going down there in the shop?"
"Not so good, Shaman. Used to be we got a weekly pick list so we knew how to plan
production. Now, we got that computer system. Most of us can't figure out how to use
3
