,Instructor’s Solutions
Manual
Accounting Information
Systems
15th Edition
Marshall B. Romney
Professor Emeritus, Brigham Young University
Paul John Steinbart
Professor Emeritus, Arizona State University
Scott L. Summers
Brigham Young University
David A. Wood
Brigham Young University
,This work is protected by United States copyright laws and is provided
solely for the use of instructors in teaching their courses and assessing
student learning. Dissemination or sale of any part of this work (including
on the World Wide Web) will destroy the integrity of the work and is not
permitted. The work and materials from it should never be made available
to students except by instructors using the accompanying text in their
classes. All recipients of this work are expected to abide by these
restrictions and to honor the intended pedagogical purposes and the needs
of other instructors who rely on these materials.
Copyright © 2021 by Pearson Education, Inc. or its affiliates. All Rights Reserved. Manufactured
in the United States of America. This publication is protected by copyright, and permission
should be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval
system, or transmission in any form or by any means, electronic, mechanical, photocopying,
recording, or otherwise. For information regarding permissions, request forms, and the
appropriate contacts within the Pearson Education Global Rights and Permissions department,
please visit www.pearsoned.com/permissions/.
PEARSON, ALWAYS LEARNING, and REVEL are exclusive trademarks owned by Pearson
Education, Inc. or its affiliates in the U.S. and/or other countries.
Unless otherwise indicated herein, any third-party trademarks, logos, or icons that may appear in
this work are the property of their respective owners, and any references to third-party
trademarks, logos, icons, or other trade dress are for demonstrative or descriptive purposes only.
Such references are not intended to imply any sponsorship, endorsement, authorization, or
promotion of Pearson’s products by the owners of such marks, or any relationship between the
owner and Pearson Education, Inc., or its affiliates, authors, licensees, or distributors.
, CHAPTER 1
ACCOUNTING INFORMATION SYSTEMS: AN OVERVIEW
SUGGESTED ANSWERS TO DISCUSSION QUESTIONS
1.1 The value of information is the difference between the benefits realized from using that
information and the costs of producing it. Would you, or any organization, ever produce
information if its expected costs exceeded its benefits? If so, provide some examples. If not,
why?
Most organizations produce information only if its value exceeds its cost. However, there are two
situations where information may be produced even if its cost exceeds its value.
a. It is often difficult to estimate accurately the value of information and the cost of producing
it. Therefore, organizations may produce information that they expect will produce benefits
in excess of its costs, only to be disappointed after the fact.
b. Production of the information may be mandated by either a government agency or a private
organization. Examples include the tax reports required by the IRS and disclosure
requirements for financial reporting.
1.2 Can the characteristics of useful information listed in Table 1-1 be met simultaneously? Or
does achieving one mean sacrificing another?
Several of the criteria in Table 1.1 can be met simultaneously. For example, more timely
information is also likely to be more relevant. Verifiable information is likely to be more accurate.
However, achieving one objective may require sacrificing another. For example, ensuring that
information is more complete may reduce its timeliness. Similarly, increased verifiability and
accuracy may reduce its timeliness.
The decision maker must decide which trade-offs are warranted in each situation.
1-1
Copyright (c) 2021 Pearson Education, Inc.
Manual
Accounting Information
Systems
15th Edition
Marshall B. Romney
Professor Emeritus, Brigham Young University
Paul John Steinbart
Professor Emeritus, Arizona State University
Scott L. Summers
Brigham Young University
David A. Wood
Brigham Young University
,This work is protected by United States copyright laws and is provided
solely for the use of instructors in teaching their courses and assessing
student learning. Dissemination or sale of any part of this work (including
on the World Wide Web) will destroy the integrity of the work and is not
permitted. The work and materials from it should never be made available
to students except by instructors using the accompanying text in their
classes. All recipients of this work are expected to abide by these
restrictions and to honor the intended pedagogical purposes and the needs
of other instructors who rely on these materials.
Copyright © 2021 by Pearson Education, Inc. or its affiliates. All Rights Reserved. Manufactured
in the United States of America. This publication is protected by copyright, and permission
should be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval
system, or transmission in any form or by any means, electronic, mechanical, photocopying,
recording, or otherwise. For information regarding permissions, request forms, and the
appropriate contacts within the Pearson Education Global Rights and Permissions department,
please visit www.pearsoned.com/permissions/.
PEARSON, ALWAYS LEARNING, and REVEL are exclusive trademarks owned by Pearson
Education, Inc. or its affiliates in the U.S. and/or other countries.
Unless otherwise indicated herein, any third-party trademarks, logos, or icons that may appear in
this work are the property of their respective owners, and any references to third-party
trademarks, logos, icons, or other trade dress are for demonstrative or descriptive purposes only.
Such references are not intended to imply any sponsorship, endorsement, authorization, or
promotion of Pearson’s products by the owners of such marks, or any relationship between the
owner and Pearson Education, Inc., or its affiliates, authors, licensees, or distributors.
, CHAPTER 1
ACCOUNTING INFORMATION SYSTEMS: AN OVERVIEW
SUGGESTED ANSWERS TO DISCUSSION QUESTIONS
1.1 The value of information is the difference between the benefits realized from using that
information and the costs of producing it. Would you, or any organization, ever produce
information if its expected costs exceeded its benefits? If so, provide some examples. If not,
why?
Most organizations produce information only if its value exceeds its cost. However, there are two
situations where information may be produced even if its cost exceeds its value.
a. It is often difficult to estimate accurately the value of information and the cost of producing
it. Therefore, organizations may produce information that they expect will produce benefits
in excess of its costs, only to be disappointed after the fact.
b. Production of the information may be mandated by either a government agency or a private
organization. Examples include the tax reports required by the IRS and disclosure
requirements for financial reporting.
1.2 Can the characteristics of useful information listed in Table 1-1 be met simultaneously? Or
does achieving one mean sacrificing another?
Several of the criteria in Table 1.1 can be met simultaneously. For example, more timely
information is also likely to be more relevant. Verifiable information is likely to be more accurate.
However, achieving one objective may require sacrificing another. For example, ensuring that
information is more complete may reduce its timeliness. Similarly, increased verifiability and
accuracy may reduce its timeliness.
The decision maker must decide which trade-offs are warranted in each situation.
1-1
Copyright (c) 2021 Pearson Education, Inc.
