[TEST BANK]ACCOUNTING INFORMATION SYSTEMS, 15THEDITION BY ROMNEY, STEINBART,SUMMERS, WOOD

[TEST BANK]ACCOUNTING INFORMATION SYSTEMS, 15THEDITION BY ROMNEY, STEINBART,SUMMERS, WOOD Chapter 1 Overview of Transaction Processing and Enterprise Resource 3 Planning Systems 2.1 Describe the four parts of the data processing cycle and the major activities in each. 1) Which of the following commonly initiates the data input process? A) a business activity B) automatic batch processing C) an accounting department source document D) a trial balance query Answer: A 2) A typical source document could be A) some type of paper document. B) a computer data entry screen. C) the company'sfinancial statements. D) both A and B Answer: D 3) Which step below is not considered to be part of the data processing cycle? A) data input B) feedback from externalsources C) data storage D) data processing Answer: B 4) John Pablo worksin the accounting department of a multinational manufacturing company. His job includes updating accounts receivable based on sales orders and remittance advices. His responsibilities are part of the company's A) revenue cycle. B) expenditure cycle. C) financing cycle. D) production cycle. Answer: A 5) John Pablo worksin the accounting department of a multinational manufacturing company. His job includes updating accounts payable based on purchase orders and checks. His responsibilities are part of the company's A) revenue cycle. 4 B) expenditure cycle. C) financing cycle. D) production cycle. Answer: B 6) Many small businesses choose to outsource their payroll activities to firms that specialize in providing payroll services. Dolores Yu operates a payroll processing business in Calabasas, California. When she sends bills out to her clients, her work is part of her firm's A) revenue cycle. B) expenditure cycle. C) financing cycle. D) production cycle. Answer: A 7) A delivery of inventory from a vendor, with whom a credit line is already established, would be initially recorded in which type of accounting record and as part of what transaction cycle? A) purchasesjournal; expenditure cycle B) general journal; expenditure cycle C) general ledger; expenditure cycle D) cash disbursementsjournal; production cycle Answer: A 9) Identify the four parts of the transaction processing cycle. A) data input, data storage, data processing, information output B) data input, data recall, data processing, information output C) data input, data recall, data transmission, information output D) data input, data recall, data transmission, data storage Answer: A 10) What isthe most frequent revenue cycle transaction? A) purchase of inventory B) receipt of cash C) sale to customer D) billing Answer: C 5 12) Identify the item below that is not one of the four different types of data processing activities. A) creating B) reading C) using D) deleting Answer: C 13) What is the final step in the data processing cycle? A) output B) storage C) processing D) input Answer: A 2.2 Describe documents and procedures used to collect and processtransaction data. 1) The general ledger A) is the initial place to record general expenses. B) is posted in total to the general journal. C) only includes balance sheet accounts. D) summarizes the transactions in journals. Answer: D 2) For a retail business, a delivery of inventory, from a vendor (with whom there is an established credit relationship) would be initially recorded in which type of accounting record as part of which transaction cycle? A) purchasesjournal; expenditure cycle B) general journal; expenditure cycle C) general ledger; expenditure cycle D) cash disbursementsjournal; production cycle Answer: A 3) Data must be collected about three facets of each business activity. What are they? A) the business activity, the resourcesit affects, the people who participate B) the business activity, the transactions it creates, the impact on the financialstatements C) the inputs, outputs and processes used D) who is involved, what was sold, how much was paid 6 Answer: A 4) Issuing a purchase order is part of which transaction cycle? A) the revenue cycle B) the expenditure cycle C) the human resources cycle D) the production cycle Answer: B 5) The collection of employee time sheets is part of which transaction cycle? A) the revenue cycle B) the production cycle C) the human resources cycle D) the expenditure cycle Answer: C 6) Common source documents for the revenue cycle include all of the following except A) sales order. B) receiving report. C) delivery ticket. D) credit memo. Answer: B 7) Which of the following documents would be found in the expenditure cycle? A) delivery ticket B) time card C) credit memo D) purchase order Answer: D 8) Documents that are sent to customers or suppliers and then sent back to the company in the course of a business transaction are known as A) turnaround documents. B) source documents. C) input documents. D) transaction documents. 7 Answer: A 9) Which of the following is an example of source data automation? A) a utility bill B) POS (point-of-sale)scanners in retailstores C) a bill of lading D) a subsidiary ledger Answer: B 10) Pre-numbering of source documents helps to verify that A) documents have been used in order. B) company policies were followed. C) all transactions have been recorded. D) source data automation was used to capture data. Answer: C 11) Source documents generally help to improve accuracy in transaction processing because A) they specify which information to collect. B) logically related data can be grouped in the same area of the document. C) they provide directions and stepsfor completing the form. D) All of the above are correct. Answer: D 12) In transaction processing, generally which activity comes first? A) recording data in a journal B) posting itemsto special journals C) capturing data on source documents D) recording data in a general ledger Answer: C 13) Which of the following statements is true? A) Batch processing ensuresthat stored information is always current. B) Batch input is more accurate than on-line data entry. C) On-line batch processing is a combination of real-time and batch processing. D) Batch processing is not frequently used.