Complete Solution Manual Accounting Information Systems 15th Edition Questions & Answers with rationales (Chapter 1-24)

Accounting Information Systems
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Instructor’s Solutions
Manual


Accounting Information
Systems
15th Edition




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Copyright (c) 2021 Pearson Education, Inc.
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, Accounting Information Systems
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Copyright (c) 2021 Pearson Education, Inc.
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, Accounting Information Systems ig ig




chapter 1 ig




accountinginformationsystems ig i
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: An overview
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Suggested Answers to Discussion Questions
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1.1 The value of information is the difference between the benef
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its realized from using that information and the costs of pro
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ducing it. Would you, or any organization,ever produce inf
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ormation if its expected costs exceededits benefits? If so, p
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rovide some examples. If not, why?ig ig ig ig ig




Most organizations produce information only if its valueexce
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eds its cost. However, there are two situations where inform
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ation may be produced even if its cost exceeds its value.
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a. It is often difficult to estimate accurately the value o
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f information and the cost of producing it. Therefore, o
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rganizations may produce information that they expect w ig ig ig ig ig ig ig




ill produce benefits in excess ofits costs, only to be dis
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appointed after the fact. ig ig ig




b. Production of the information may be mandated by either a ig ig ig ig ig ig ig ig ig




government agency or a private organization. Examples i
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nclude the tax reports required by the IRS and disclosureig ig ig ig ig ig ig ig ig




requirements forfinancial reporting.
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1.2 Can the characteristics of useful information listed inTabl
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e 1-
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1 be met simultaneously? Or does achieving onemean sacrifici
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ng another?
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Several of the criteria in Table 1.1 can be met simultaneously
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. For example, more timely information is
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, Accounting Information Systems ig ig




also likely to be more relevant.
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kely to be more accurate. ig ig ig ig




However, achieving one objective may require sacrificinganot ig ig ig ig ig ig i
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her. For example, ensuring that information is morecomplete
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may reduce its timeliness. Similarly, increased verifiabi
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lity and accuracy may reduce its timeliness.
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The decision maker must decide which trade-
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offs arewarranted in each situation.
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1.3 You and a few of your classmates decided to become entreprene
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urs. You came up with a great idea for a newmobile phone appl
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ication that you think will make lots of money. Your business
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plan won second place in a local competition, and you are usin
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g the $10,000 prize to support yourselves as you start your co
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mpany.

a. Identify the key decisions you need to make to be successfu ig ig ig ig ig ig ig ig ig ig




l entrepreneurs, the information you need tomake them, and
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the business processes you will need to engage in.
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b. Your company will need to exchange information withvario
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us external parties. Identify the external parties, and
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specify the information received from and sent to each of ig ig ig ig ig ig ig ig ig




them. ig




The author turns this question into an in-
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class groupactivity. Students are divided up in groups, to
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ld toclose their books, and given 15 minutes to:
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a. Think through the business processes, key decisions,and ig ig ig ig ig ig i
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information needs issues in their group. ig ig ig ig ig




b. Identify the external users of information and specif ig ig ig ig ig ig ig




y the information received from and sent toeach of them
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.

One group is selected to present their answers to the class. Th
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e other groups are told to challenge the group’s answers, prov
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ide alternative answers, and chip in with additional answers
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not provided by the selected group. Since the group that prese
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nts is not selected until after the time has expired, students
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are motivatedto do a good job, as they will be presenting to the
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ir peers.ig




The value of this activity is not in arriving at a
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