Which of the following exemplifies materiality as the term is used in the FASB conceptual framework

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/

Chapter 01
Role and Purpose of Accounting Information Systems

Multiple Choice Questions

1. An accounting information system is a set of interrelated:

A. Activities and documents only.
B. Activities and technologies only.
C. Documents and technologies only.
D. Activities, documents and technologies.
2. The components of an accounting information system are designed to collect ___ and report ___.

A. Data; information
B. Data; data
C. Information; information
D. Information; data

1-1
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
3. An accounting information system is defined by the text as a set of three interrelated elements.

Which of the following choices best gives an example of each element?

A. Buying inventory, selling inventory, balance sheet
B. Buying inventory, sales invoice, general ledger software
C. Selling inventory, sales invoice, balance sheet
D. Selling inventory, writing a check, general ledger software
4. An accounting information system transforms inputs into outputs via processes such as:

A. Journalizing transactions and posting them to the ledger
B. Identifying the elements of the FASB Conceptual Framework
C. Always utilizing information technology
D. Recognizing and adapting to the cost-benefit constraint
5. Which of the following best fits the definition of an accounting information system explained in the
text?

A. A checkbook register
B. A publicly-traded corporation's financial statements
C. Processed source documents leading to the general purpose financial statements
D. An Excel spreadsheet of financial statement ratios

1-2
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
6. April compiled checks, receipts and invoices, then entered them into Quickbooks. She printed out

her financial statements and took them to the bank as documentation for a loan application. In
that scenario, checks, receipts and invoices could be referred to as:

A. Documents and data
B. Data and information
C. Documents and information
D. Documents, data and information
7. Claudia borrowed money from her bank, signing a five-year note payable. She then calculated
the monthly payment needed to pay off the loan within three years. Which of the following
statements is/are most true?

A. The required monthly payment is an example of "information," as the term is used in the
definition of an accounting information system.
B. The five-year note payable would be considered a "technology" if it were prepared with
computer software.
C. Both the required monthly payment is an example of "information," as the term is used in the
definition of an accounting information system and the five-year note payable would be
considered a "technology" if it were prepared with computer software are true.
D. Neither the required monthly payment is an example of "information," as the term is used in
the definition of an accounting information system nor the five-year note payable would be
considered a "technology" if it were prepared with computer software is true.

1-3
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt

Full file at https://TestbankDirect.eu/
8. Claudia borrowed money from her bank, signing a five-year note payable. She then calculated
the monthly payment needed to pay off the loan within three years. Based on the definition of an
accounting information system provided in the text, the five-year note payable could be
considered: (i) an input, (ii) an output, (iii) a document.

A. I and II only
B. I and III only
C. II and III only
D. I, II and III
9. Eugene is a self-employed business owner. In February 2011, he gathered together his income
and expense records for 2010. He used them, along with appropriate software, to prepare his tax
return, which he then transmitted to the Internal Revenue Service. Has Eugene used an
accounting information system based on the definition provided in the text?

A. Yes, because he used software to prepare his tax return.
B. Yes, because all elements of the definition are present.
C. No, because all accounting information systems must produce general purpose financial
statements.
D. No, because no internal decision maker is mentioned.

1-4
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/

10. The vice president for customer service of First United Bank determined that Lee had overpaid
his mortgage. The bank sent Lee a letter asking him if he wanted a refund of the overpayment or
if he wanted to apply it to future mortgage payments. Has the vice president for customer service
used an accounting information system based on the definition provided in the text?

A. No, because no mention is made of software.
B. No, because the letter does not constitute an output.
C. No, because no mention is made of general purpose financial statements.
D. Yes, because all elements of the definition are present or implied.
11. Accounting information systems is an important area of study for future accountants because: (i)
Developing a strong accounting information system helps achieve some of the components of the
FASB Conceptual Framework of Accounting, (ii) Studying AIS helps students develop many of
the core competencies suggested by the AICPA, (iii) Acquiring knowledge about AIS helps
students learn more about common business processes.

A. (i) and (ii) only
B. (ii) and (iii) only
C. (i) and (iii) only
D. (i), (ii) and (iii)

1-5
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
12. Accounting information systems is an important area of study for future accountants because a

well-designed AIS can respond to many elements of the FASB Conceptual Framework. All of the
following are parts of the conceptual framework except:

A. Principles of debit and credit
B. Objective of financial reporting
C. Elements of financial statements
D. Qualitative characteristics of accounting information
13. Which of the following best explains why AIS is an important area of study for future
accountants?

A. AIS connects other areas of accounting, such as intermediate and cost accounting.
B. AIS connects accounting with other subjects, such as finance and management.
C. Both AIS connects other areas of accounting, such as intermediate and cost accounting and
AIS connects accounting with other subjects, such as finance and management.
D. Neither AIS connects other areas of accounting, such as intermediate and cost accounting nor
AIS connects accounting with other subjects, such as finance and management.

1-6
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
14. AIS is an important area of study for future accountants because a well-designed AIS can
recognize and adapt to the cost-benefit constraint. Which of the following statements is most
true?

A. Nonfinancial costs and benefits are less important than financial costs and benefits in
designing an AIS.
B. Resistance to change is a potential cost when making changes to the AIS.
C. Financial statement users benefit from more information when it comes from the AIS.
D. Source documents should be electronic, rather than paper-based, because electronic
documents are more cost effective.
15. AIS is an important area of study for future accountants because a well-designed AIS can
respond to many elements of the conceptual framework. Which of the following best pairs an
element of the conceptual framework with a specific example of that element?

A. Relevance, land reported at historical cost
B. Consistency, land reported at historical cost
C. Matching, land is not depreciated
D. Gain, difference between historical cost and current market value for land used in operations

1-7
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
16. AIS is an important area of study for future accountants because a well-designed AIS can
respond to many elements of the conceptual framework. Which of the following statements is
most true?

A. Land is reported as an asset on the balance sheet; assets are one element of financial
statements in the conceptual framework.

B. The difference between land's current market value and its historical cost is reported as a gain
on the income statement; gains are one element of financial statements in the conceptual
framework.
C. Because of the qualitative characteristic of consistency, publicly traded corporations cannot
change their accounting methods.
D. Because of the qualitative characteristic of reliability, publicly traded corporations cannot
change their accounting methods.
17. AIS is an important area of study for future accountants because a well-designed AIS can
respond to many elements of the conceptual framework. Which of the following statements about
qualitative characteristics of accounting information is most true?

A. Reliability is more important than relevance.
B. Relevance is more important than reliability.
C. Reliability must sometimes be sacrificed to attain relevance.
D. Tradeoffs between relevance and reliability violate the cost-benefit constraint.

1-8
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
18. VTR Corporation's accounting information system recently reported the following information:
Cost of goods sold, $1,500. Inventory, $15,000. Unearned service fees, $3,000. Service fees
earned, $8,000. Which element of financial statements is not included in the preceding data?

A. Assets

B. Equity
C. Expense
D. Liabilities
19. Which of the following elements of the conceptual framework fit within the same category?

A. Economic entity, historical cost
B. Conservatism, historical cost
C. Economic entity, conservatism
D. Conservatism, materiality

1-9
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
20. Which of the following exemplifies "materiality" as the term is used in the FASB conceptual
framework?

A. BCC Corporation purchased a $30 wastebasket with an expected useful life of 10 years. BCC
charged the entire cost to expense in the period incurred.
B. Reported account balances in DPT Corporation's financial statements are rounded to the
nearest whole dollar.
C. Both BCC Corporation purchased a $30 wastebasket with an expected useful life of 10 years.
BCC charged the entire cost to expense in the period incurred and reported account balances
in DPT Corporation's financial statements are rounded to the nearest whole dollar.
D. Neither BCC Corporation purchased a $30 wastebasket with an expected useful life of 10

years. BCC charged the entire cost to expense in the period incurred nor reported account
balances in DPT Corporation's financial statements are rounded to the nearest whole dollar.
21. Which of the following statements about AIS is most true?

A. Compared to introductory accounting, AIS is more likely to have problems with
nondeterministic answers.
B. Compared to introductory accounting, AIS is less likely to have problems with nondeterministic
answers.
C. Introductory accounting and AIS are equally likely to have problems with nondeterministic
answers.
D. All problems in AIS have nondeterministic answers.

1-10
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
22. Which of the following statements about AIS is most true?

A. The topics studied in an AIS course are unrelated to those in other accounting courses.
B. AIS is the only area of accounting that involves questions with nondeterministic answers.
C. The five generic elements of an AIS can be discussed in other areas of accounting.
D. All of these statements are true.
23. AIS study sometimes involves questions with deterministic answers. Which of the following
questions is most likely to have a deterministic answer?

A. How should a company record the purchase of supplies on account in its AIS?
B. In a corporation with sales of $100,000 annually, what dollar amount should be considered
material?
C. Which processing tools should the AIS use?
D. Has the conceptual framework achieved the FASB's original objective for developing it?
24. Joe has completed all his accounting coursework and is ready to graduate. In his education, he
has learned how to: analyze source documents, use Excel, make journal entries and prepare tax
returns. Which generic element of the AIS is missing from that list?

A. Inputs
B. Outputs
C. Storage
D. Processes

1-11
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
25. Which of the following statements best demonstrates a similarity between AIS and other areas of
study in accounting?

A. AIS is primarily concerned with numbers.
B. Communication skills are important in AIS.
C. Both AIS is primarily concerned with numbers and communication skills are important in AIS.
D. Neither AIS is primarily concerned with numbers nor communication skills are important in AIS.

26. Which of the following statements best demonstrates a difference between AIS and other areas
of study in accounting?

A. General ledger software can only be used in AIS.
B. The matching principle is less important in AIS than in other areas of accounting.
C. AIS often looks at the "big picture" of accounting.
D. Topics studied in AIS courses are not typically included on accounting professional exams.
27. AIS can be linked to other areas of study in accounting by focusing on the five generic elements
of the AIS. Which of the following is a process that might be studied in management or cost
accounting?

A. Components of the master budget
B. How to prepare the master budget
C. Both components of the master budget and how to prepare the master budget
D. Neither components of the master budget nor how to prepare the master budget

1-12
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
28. AIS can be linked to other areas of study in accounting by focusing on the five generic elements
of the AIS. Which of the following pairs a generic element of the AIS with a specific example from
financial accounting?

A. Bank reconciliation, internal control

B. Adjusting entries, output
C. Financial statements, storage
D. FASB Conceptual Framework, input
29. In an auditing course, students develop their decision making skills, learn how to conduct a
financial statement audit and learn the various types of audit reports. Which of the following
therefore links AIS with auditing?

A. Communication skills
B. Professional judgment
C. Both communication skills and professional judgment
D. Neither communication skills nor professional judgment
30. In management accounting, students learn to prepare budgets, calculate cost variances and
interpret those variances. Which of the following best links those topics with AIS study?

A. Use of professional judgment
B. Journal entry preparation
C. Both use of professional judgment and journal entry preparation
D. Neither use of professional judgment nor journal entry preparation

1-13
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
31. The generic structure of most accounting information systems comprises ___ elements.

A. Three
B. Four
C. Five
D. More than five
32. Which generic element of the AIS is focused on master files, transaction files and junction files?

A. Inputs
B. Processes
C. Outputs
D. Storage
33. Which of the following is an example of an AIS output?

A. Journal entries
B. Statement of cash flows
C. Sales transaction file
D. General ledger software

1-14
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
34. Ethan is an accountant for a small startup business. He is trying to decide if the business should
use paper-based journals and ledgers or a spreadsheet to record transactions. He is therefore
making a decision about which generic element of the AIS?

A. Inputs
B. Processes
C. Outputs
D. Technology
35. Sienna used a stack of sales invoices to record journal entries in the AIS. She used those entries
and others to prepare an income statement that was later reviewed by her supervisor. All the
generic elements of the AIS are represented in Sienna's actions except:

A. Internal controls
B. Outputs
C. Storage
D. Inputs
36. Sienna used a stack of sales invoices to record journal entries in the AIS. She used those entries
and others to prepare an income statement that was later reviewed by her supervisor. The
supervisor's review could best be described as which generic element of the AIS?

A. Input
B. Output
C. Process
D. Internal control

1-15
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/

37. The generic elements of an AIS include inputs and outputs. Which of the following statements
about them is most true?

A. Inputs should be paper-based; outputs should be electronic.
B. Outputs should be paper-based; inputs should be electronic.
C. If inputs are paper-based, outputs should also be paper-based.
D. If inputs are electronic, outputs could be either paper-based or electronic.
38. The generic elements of an AIS include processes and storage. Which of the following
statements about them is most true?

A. Both require internal controls, but the specific controls may be different.
B. Both require identical internal controls.
C. Storage is not subject to internal controls, but processes are.
D. Processes are not subject to internal controls, but storage is.
39. Storage is one generic element of the AIS; the text explains that data stored electronically often
are grouped into three types of files. Which of the following includes three examples of the same
file type?

A. Purchases, cash receipts, sales
B. Inventory, cash receipts, sales
C. Purchases, cash, sales
D. Inventory, cash, sales

1-16
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
40. Storage is one generic element of the AIS; the text explains that data stored electronically often
are grouped into three types of files. Which of the following includes one example of each file
type?

A. Purchases, sales, inventory
B. Purchases, inventory, purchases/inventory
C. Cash receipts, cash payments, cash on hand
D. Sales, cost of goods sold, inventory
41. Information literacy is the ability to ___ information in all of its various formats.

A. Find and evaluate
B. Use and communicate
C. Find, evaluate, use and communicate
D. Use and evaluate
42. According to the University of Maryland's University College, information should be evaluated
based on ___ criteria.

A. Two
B. Three
C. Four
D. Five
E. More than five

1-17
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
43. Which of the following best summarizes "authority," as the term is used in information
evaluation?

A. Only people with college degrees have true authority to publish.
B. An author cannot evaluate information.
C. The author's credentials should be described as clearly and completely as possible.
D. The more authors a paper has, the more authoritative it is.
44. Which of the following best explains the idea of "currency," as the term is used in evaluating
information?

A. Information more than five years old should never be used.
B. Financial information is always more accurate than nonfinancial information.
C. Authors without a current college degree have no authority to publish.
D. Users should consider the relationship between the subject and the publication date.
45. Bumble Beasley, a recent accounting graduate from a private, for-profit university, started his own
accounting consulting firm. His web page discussed internal controls, inputs, processes and
outputs in relation to the design and implementation of accounting information systems. Should
his web page be considered a good source of information about the generic structure of AIS?

A. Yes. Because he has a college degree, he has authority.
B. Yes. Because he is a recent graduate, the information is current.
C. No. Since his degree is from a private, for-profit university, he cannot be objective.
D. No. He is in violation of at least one of the UMUC criteria for evaluating information.

1-18
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of

McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
46. A consulting company summarized the key provisions of the Sarbanes-Oxley Act in a half-page
flyer, which was then mailed to prospective clients. The flyer contained the name of the consulting
company, but did not identify any of its employees by name. In addition to objectivity, the flyer is
most likely in violation of which UMUC criterion for information evaluation?

A. Authority
B. Accuracy
C. Currency
D. Coverage
47. UMUC identified several criteria for evaluating information. Which of the following statements is
most true?

A. Any piece of information that does not meet all five should be ignored.
B. Meeting any three of the five criteria indicates that information must be considered.
C. Authority and accuracy are more important than the other criteria.
D. The importance of each category depends upon the source and intended use of the
information.
48. Ahmed was writing a paper summarizing three processes common in most organizations; his
specific focus was on for-profit manufacturing organizations. In terms of the UMUC criteria for
information evaluation, Ahmed's paper is most likely to violate:

A. Coverage, because it discusses only three processes.
B. Currency, because it does not focus on dollar amounts.

C. Authority, because Ahmed has no authority to write such a paper.
D. Relevance, because it focuses on for-profit manufacturing organizations.

1-19
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
49. As a requirement of his AIS course, Ahmed was preparing a short paper on why AIS is an
important area of study for future accountants. In terms of the UMUC information literacy criteria,
which of the following statements is most true?

A. Ahmed has sufficient authority to write the paper; he does not need to consult outside sources.
B. To meet the accuracy criterion, he must discuss exactly three reasons.
C. By consulting at least five sources, Ahmed will be sure to meet the objectivity criterion.
D. His paper may have sufficient coverage if he discusses at least three reasons.
50. Gloria wrote a paper on the AICPA core competencies for her accounting information systems
class. She organized the paper in three main parts: broad business perspective competencies,
functional competencies, conceptual framework competencies. In terms of the UMUC criteria for
information evaluation, which of the following statements is most true?

A. Gloria must add at least one section for the paper to have sufficient coverage.
B. Gloria must add one section and delete one section for the paper to have sufficient coverage.
C. Unless the paper is published within six months, it will not be current.
D. The section on conceptual framework competencies must discuss all elements of the
conceptual framework.

51. The AICPA Core Competency framework comprises three parts. Which of the following best pairs
a specific competency with the correct part?

A. Resource management, broad business perspective
B. Risk analysis, functional
C. Both resource management, broad business perspective and risk analysis, functional
D. Neither resource management, broad business perspective nor risk analysis, functional

1-20
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
52. The AICPA Core Competency framework comprises three parts. All of the following
competencies belong to the same part except:

A. Problem solving
B. Decision making
C. Communication
D. Research
53. Studying AIS helps students understand business processes from an accounting perspective.
Which of the following activities would commonly be associated with the financing process?

A. Selling goods and services on credit
B. Issuing equity securities
C. Making payments to vendors

D. Hiring employees to work in the finance department
54. Studying AIS helps students understand business processes from an accounting perspective.
Which of the following general ledger accounts would be unique to a company with a conversion
process?

A. Work in process
B. Inventory
C. Supplies
D. Payroll expense

1-21
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
55. An accounting information system comprises five generic parts. Which of the following gives an
example of an internal control associated with the sales/collection process?

A. Depositing cash in the bank daily
B. Adequately supervising employees who handle inventory
C. Both depositing cash in the bank daily and adequately supervising employees who handle
inventory
D. Neither depositing cash in the bank daily nor adequately supervising employees who handle
inventory
56. An accounting information system comprises five generic parts. Which of the following gives an
example of an internal control associated with the financing process?

A. Maintaining a good credit rating to facilitate the issuance of bonds and other debt securities.
B. Evaluating employees in the finance department on a quarterly basis.
C. Both maintaining a good credit rating to facilitate the issuance of bonds and other debt
securities and evaluating employees in the finance department on a quarterly basis.
D. Neither maintaining a good credit rating to facilitate the issuance of bonds and other debt
securities nor evaluating employees in the finance department on a quarterly basis.
57. Most accounting information systems comprise five parts. Which of the following must be used as
a processing tool in the AIS?

A. Spreadsheets
B. Relational databases
C. Both spreadsheets and relational databases
D. Neither spreadsheets nor relational databases

1-22
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
58. JPS Corporation's accounting information system includes sales invoices, general ledger
software, spreadsheets and customer files. JPS is careful to maintain adequate separation of
duties as well. To provide one example of each generic element of the AIS, that list should
replace ___ with ___.

A. Spreadsheets; operational budgets

B. Customer files; sales transaction files
C. General ledger software; satellites
D. Adequate separation of duties; regular AIS data backup
59. Accounting information systems has links with other areas of accounting study, including financial
accounting. Which of the following combines an example of an AIS output with information you
would expect to find in the output?

A. Income statement, net sales broken down by product line
B. Journal entries, accounts to debit and credit
C. Balance sheet, listing of current asset accounts with their balances
D. All of these

1-23
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
60. Accounting information systems has links with other areas of accounting study, including financial
accounting. Which of the following combines an example of AIS storage with information you
would expect to find in it?

A. Balance sheet, listing of current asset accounts with their balances
B. Master file, customer address
C. Both balance sheet, listing of current asset accounts with their balances and master file,
customer address
D. Neither balance sheet, listing of current asset accounts with their balances nor master file,

customer address

Essay Questions

1-24
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of
McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Test Bank for Accounting Information Systems 4th Edition by Hurt
Full file at https://TestbankDirect.eu/
61. Which generic element of the AIS is most closely associated with each of the following
questions?
a. Beyond the general-purpose financial statements, what other reports will managers and
system users need?
b. How many copies of each source document will be required?
c. How should the AIS be designed to facilitate the production of other reports?
d. If computer-based tools are used in the AIS, which software and hardware packages should be
implemented?
e. Should AIS tools be manual, computer-based or both?
f. Under what conditions can/should data be destroyed?
g. What behavioral effects are controls likely to have?
h. What controls are necessary to promote information integrity in the AIS?
i. What kinds of source documents will system users need?
j. Where should data be stored?

1-25
Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of

McGraw-Hill Education.

Full file at https://TestbankDirect.eu/

Which of the following has the federal statutory authority to set accounting standards in the United States?

Which of the following best summarizes authority as the term is used in information evaluation?

Which of the following best explains why AIS is an important area of study for future accountants?

Which of the following characteristics is demonstrated when different accountants independently agree on the amount and method of reporting a transaction or event?