AIS101 - Midterm Examination

Some information will have to be collected from ______________ sources to

determine, for example, customer satisfaction. *
a. Internal
b. External
c. Regulatory
d. Competitive

The four functions that are common to all accounting systems regardless of
complexity are Journalizing, posting, trial balance and reports *
a. Journalizing, posting, trial balance and reports
b. Data preparation, journalizing, posting and reports
c. Data entry, transaction processing and master file update, report generation, and document
generation functions
d. Data preparation, data entry, transaction processing and master file update, and document and
report generation

An agreement between two entities to exchange goods or services or any other event
that can be measured in economic terms by an organization is *
a. Revenue.
b. Transaction.
c. Processing cycle.
d. Give-get exchange.

Regarding codes, which of the following is false? *

a. Coding systems should be as simple as possible
b. The code should be consistent with its intended use.
c. Codes should allow for growth in the number of items to be coded
d. Coding systems need not be consistent across divisions of an organization.

Esme Clothing is a boutique retailer located in Luneta Park. During the peak tourist
season, it has average daily cash and credit card sales in excess of P 5,000. What is
the best way for this business to ensure that sales data entry is efficient and
accurate? *
a. Turnaround documents
b. Source data automation
c. Well-designed paper forms
d. Sequentially numbered forms

Identify an example of external source data that is important to an organization. *

a. Staff salaries as a percentage of sales
b. Customer satisfaction as gauged by surveys
c. Satisfaction of employees with their work environment
d. Sales revenue divided by the number of hours worked by the sales staff

It refers to the key information that describes the company’s customers, vendors, and
leads as well as items that the company buys and sells *
a. Data
b. Master Data
c. Item Master Data
d. Business Partner Master Data
Documents generated at the end of transaction processing activities are called *
a. Reports
b. Source documents
c. Financial statements
d. Operational documents

The systematic assignment of numbers or letters to items to classify and organize

them is known as *
a. Coding
b. Data Input
c. Chart of Accounts
d. Pre-numbered Documents

In Quezon City, electric power is provided to consumers by the Power To The People
Electrical Company, a local co-op. Each month, the company mails bills to 70,000
households and then processes payments as they are received. What is the best way
for this business to ensure that payment data entry is efficient and accurate? *
a. Source data automation
b. Turnaround documents
c. Well-designed paper forms
d. Sequentially numbered forms

Pre- numbering of source documents helps to verify that *

a. All cash has been collected
b. No inventory has been misplaced.
c. Documents have been used in order.
d. All transactions have been recorded since the numerical sequence serves as a control.

In transaction processing, generally which activity comes first? *

a. Posting data to a ledger
b. Recording data in a journal
c. Posting items to special journals
d. Capturing data on source documents

A specialized journal would be most likely to be used to enter *

a. Sales transactions.
b. Depreciation adjustments.
c. End-of-year closing transactions.
d. Annual mortgage payments on land and structures.

In an effort to measure and evaluate the productivity of word processing specialists,

the office manager at Four-Q Consulting acquired a software package that counts the
number of keystrokes per day by each employee. Some weeks later, the manager
observed several of the employees sitting at their work stations during lunch and
randomly punching keys. This is an example of: *
a. Employee innovation.
b. On-line, real-time processing.
c. A lack of management controls.
d. The reporting system leading to dysfunctional behavior.

The smallest unit of an item *

a. Data
b. Information
c. Master Data
d. Item Master Data

One of the steps in the data processing cycle is data input. What is the catalyst for
data input into a system? *
a. Data is only input when an authorized party permits the input to occur.
b. The performance of some business activity generally serves as the trigger for data input.
c. A general ledger program is queried to produce a trial balance at the end of an accounting
period.
d. The production transaction system automatically checks each hour to see if any new data is
available for input and processing.

Which of the following documents would be found in the expenditure cycle? *

a. Time card
b. Delivery ticket
c. Journal voucher
d. Purchase order

The quality assurance department at a large manufacturing business enters data into
the AIS that is used to produce a weekly report that summarizes the proportion of
defective units in each product line. This is an example of: *
a. Internal financial information.
b. External financial information.
c. External nonfinancial information.
d. Internal nonfinancial information.

All transactions cycles feed information directly into the *

a. Financial statements.
b. Governmental reports
c. Financing operations.
d. General ledger and reporting system.

Hector Sanchez works in the accounting department of a multinational manufacturing

firm. A large part of his job involves updating accounts receivable based on sales
reports and payments received. His responsibilities are part of the firm’s *
a. Revenue cycle.
b. Financing cycle.
c. Production cycle.
d. Expenditure cycle.

It refers to the products that are sold to the customers or purchased from vendors and
services rendered *
a. Items
b. Supply Chain
c. Business Partners
d. Batch and Serial Transactions

Transaction cycles can be summarized on a high level as “give-get” transactions. An

example of “give-get” in the revenue cycle would be *
a. Give cash, get goods.
b. Give cash, get cash.
c. Give cash, get labor.
d. Give goods, get cash.

Once data are entered into files, the files are processed. File processing includes all of
the following except *
a. Deleting.
b. Updating
c. Verifying.
d. Changing.

Which is a true statement regarding whether or not laptops make good servers? *
a. Their mobility allows for more flexibility in where you store the server
b. Their redundancy makes them reliable, particularly during power outages
c. Their size and weight make them perfect for a server rack, and this allows for better cooling
d. There is no room for expansion, and you are paying for components and a design that isn't
practical

Source documents generally help to improve accuracy in transaction processing

because *
a. Standard information is preprinted on the document.
b. They provide directions and steps for completing the form.
c. They specify which information to collect due to their structure
d. All of the above are correct.

What is the major difference between the revenue and expenditure cycle? *
a. The expenditure cycle includes paying employees.
b. The revenue cycle includes the activity of obtaining funds from investors.
c. The revenue cycle includes marketing activities; the expenditure cycle does not.
d. In the revenue cycle, cash is received; in the expenditure cycle cash is paid out.

Which statement below regarding the AIS and managerial reports is false? *
a. Most source documents capture both financial and operational data about business
transactions.
b. Both traditional financial measures and operational data are required for proper and complete
evaluation of performance.
c. The AIS must be able to provide managers with detailed and operational information about the
organization’s performance.
d. Traditionally, most AIS systems have been designed so that both financial and operational
data are stored in a manner that facilitates their integration in reports.

Navigation in SAP Business One is done using the _____________. It arranges the
functions of the individual applications in a tree structure. *
1 point

a. Menu Bar
b. Tool Bar
c. Modules Menu
d. Web Browsers

This is business management software that allows an organization to use a system of

integrated applications to manage the business. It aims to serve as a backbone for
your whole business *
a. CAATTs
b. SAP Business One on Cloud
c. SAP Business One on Premise
d. Enterprise Resource Planning (ERP) System

Certain documents or forms are generated and/or processed with each transaction
cycle. The issuing of a purchase order is part of which transaction cycle? *
a. the revenue cycle
b. the production cycle
c. the expenditure cycle
d. the human resources cycle

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. Financing cycle.
c. Production cycle.
d. Expenditure cycle.

Many modern accounting software packages offer separate cycle modules. What is
the reason for this? *
a. Most businesses do not need the revenue cycle module as part of their AIS.
b. The nature of a given transaction cycle is the same irrespective of the type of organization.
c. Every organization does not need to implement all of the available transaction cycle modules.
d. Properly designed AIS does not use the concept of separate business transaction cycles to
process transactions.

SAP Business One provides optimum support for your business processes. In sales, it
helps you create orders, delivery notes, and outgoing invoices because prices, sales
units and gross profit calculate automatically. You can optimize stockholding of the
company through this data or sub-module. You have complete control over stock
quantities at all times and can also analyze the financial aspects of stockholding at the
same time. The system allows you to control production based on the items that are
used for production and based on the finished product and any by-products created *
a. Master Data
b. Item Master Data
c. Production Data / Stock Data
d. Business Partner Master Data

A typical source document could be *

a. A notepad entry.
b. In some paper form.
c. A computer data entry screen.
d. Both a and b

A business partner where all sales transactions and sales opportunities can be
performed *
a. Leads
b. Prospects
c. Customers
d. Vendor/Supplier

The ______________ displays at the top of the screen. It contains the Windows
standard menu (File, Edit, W window, Help) as well as generic SAP Business One
functions. *
a. Tool Bar
b. Menu Bar
c. Web Browsers
d. Modules Menu
Which of the following statements is false? *
a. Retail stores do not have a production cycle.
b. Financial institutions have installment-loan cycles.
c. A service company does not have an inventory system.
d. Every organization should implement every transaction cycle module.

Which of the following is conceptually similar to a journal in manual AIS? *

a. Record
b. Database
c. Master file
d. Transaction file

The operations performed on data to generate meaningful and relevant information

are referred to as *
a. financial reporting
b. data processing cycle
c. accounting information system
d. general ledger and reporting system

Is a structure that a business uses to collect, store, manage, process, retrieve, and
report its financial data so it can be used by accountants, consultants, business
analysts, managers, chief financial officers (CFOs), auditors, regulators, and tax
agencies *
a. Information Technology
b. Enterprise Resource Planning
c. Information Technology Audit
d. Accounting Information System

Concerning a master file, which of the following statements is false? *

a. It exists across fiscal periods.
b. Its individual records are not changed.
c. It is conceptually similar to a ledger in manual AIS.
d. It stores cumulative information about an organization’s resources.

Identify the documents in the Purchasing Process *

a. Purchase Order > Delivery > AP Invoice > Outgoing Payment

b. Purchase Requisition > Purchase Order > Invoice > Outgoing Payment
c. Purchase Order > Goods Receipt PO > AP Invoice > Outgoing Payment
d. Purchase Request > Goods Receipt PO > AP Invoice > Outgoing Payment

Transaction cycles can be summarized on a high level as “give-get” transactions. An

example of “give-get” in the expenditure cycle would be *
a. Give cash, get cash.
b. Give cash, get goods.
c. Give cash, get labor.
d. Give goods, get cash.

Most software systems have lists of data that are shared and used by several of the
applications that make up the system. For example, a typical ERP System as a
minimum will have a Customer Master Data, an Item Master Data, and an Account
Master Data. This is often one of the key assets of a company *
a. Master Data
b. Item Master Data
c. Business Partner Master Data
d. Systems, Applications, and Products in Data Processing

The _____________ is a collection of icon buttons that grant you easy access to
commonly-used functions. *
a. Tool Bar
b. Menu Bar
c. Web Browsers
d. Modules Menu

Applications such as word processors, spreadsheet programs, and payroll programs,

can be installed within the OS to extend the range of things that the computer can be
used to do *
a. Microsoft Excel
b. Operating System
c. SAP Business One
d. Application Software
e. Accounting Information System

What is the default mode of a marketing document? *

a. Add
b. Find
c. Update
d. Remove

What are the components of a database management system? (Choose the incorrect
one) *
a. Data
b. Users
c. Software
d. Hardware
e. Information

Hector Sanchez works in the accounting department of a multinational manufacturing

firm. A large part of his job involves updating accounts payable based on purchase
reports and payments made by the firm. His responsibilities are part of the firm’s *
a. Revenue cycle.
b. Financing cycle.
c. Production cycle.
d. Expenditure cycle.

A business partner where all purchasing transactions can be performed *

a. Leads
b. Prospects
c. Customers
d. Vendor/Supplier

Federal express stated in one of its mission statements that “positive control of each
package will be maintained by utilizing… electronic tracking and tracing systems.” This
is an example of which type of data processing? *
a. Batch processing which features updating at fixed time periods
b. Batch processing which features immediate updating as to the location of packages
c. Real-time processing which features updating at fixed time periods such as at the end of an
accounting period
d. Real-time processing which features immediate updating as to the location of packages

Which of the following is not a transaction cycle? *

a. Revenue
b. Expenditure
c. Human resources
d. General ledger and reporting

A business partner where quotations, orders, and sales opportunities can be

performed *
a. Leads
b. Prospects
c. Customers
d. Vendor/Supplier

Each customer, vendor, or interested party is entered in the system as a master

record. This sub-module is used to record and retrieve business partner (customers,
vendors, and leads) information and schedule business partner activities. *
a. Business Partner
b. Business Partner Master Data
c. Add Mode in Business Partner
d. Find Mode in Business Partner

This system increases the quality and ensures that the data is maintained in
accordance to business structure and its needs. It also reduces program maintenance
and data hacking *
a. Accounting Information System
b. Database Management System
c. Enterprise Resource Planning System
d. Systems, Applications, and Products (SAP)

One of the steps in the data processing cycle is data input. What is the catalyst for
data input into a system? *
a. Data is only input when an authorized party permits the input to occur
b. The performance of some business activity generally serves as the trigger for data input.
c. A general ledger program is queried to produce a trial balance at the end of an accounting
period.
d. The production transaction system automatically checks each hour to see if any new data is
available for input and processing.

Periodic updating of the data stored about resources and agents is *
a. Data processing
b. Batch processing
c. On-line processing
d. Real-time processing

Groups of related business activities such as the acquisition of merchandise and

payment of vendors are called *
a. Transactions.
b. Business events.
c. Economic cycles.
d. Transaction cycles.

The following are the categories of an Item Master Data, except *

a. Sales
b. Purchase
c. Inventory
d. Financial
e. Fixed Asset

Which step below is not considered to be part of the data processing cycle? *
a. Data input
b. Data storage
c. Data processing
d. Feedback from external sources

The transaction cycles approach leads to efficient processing of large number of

transactions because *
a. Transaction cycles are easy to understand.
b. Transaction cycles are easier to computerize.
c. The transaction cycle approach represents the natural order of business.
d. A large number of transactions within a given cycle can be categorized into a relatively small
number of distinct types.

Data must be collected about three facets of each business activity. What are they? *
a. The inputs, outputs and processes used
b. Who is involved, what was sold, how much was paid
c. The business activity, the resources it affects, the people who participate
d. The business activity, the transactions it creates, the impact on the financial statements

Pre- numbered checks, invoices and purchase orders are examples of *
1 point

a. Block codes
b. Group codes
c. Sequence codes
d. Hierarchical codes

Identify the documents in the following Sales Process: *

a. Sales Order > Delivery > AR Invoice > Incoming Payment

b. Sales Quotation > Sales Order > Invoice > Incoming Payment
c. Sales Quotation > Delivery > AR Invoice > Incoming Payment
d. Sales Order > Goods Receipt PO > Invoice > Incoming Payment

Concerning processing, which of the following statements is true? *

a. Batch processing is almost never used.
b. Batch input is more accurate than on-line data entry.
c. Batch processing ensures that stored information is always current.
d. On-line batch processing is a combination of real-time and batch processing.

The coding method used for checks and receipts is called a *
a. Data code.
b. Block code.
c. Group code.
d. Sequence code.

This is business management software that allows an organization to use a system of

integrated applications to manage the business. It aims to serve as a backbone for
your whole business *
a. Information Technology (IT)
b. Accounting Information System (AIS)
c. Enterprise Resource Planning (ERP) System
d. Systems, Applications, and Products (SAP) in Data Processing

Which of the following is not a type of report provided to decision makers by the
typical AIS? *
a. Managerial reports
b. Financial statements
c. All of the above reports are important to decision makers.
d. Customer satisfaction surveys conducted by third parties

Which of the following is an example of an ERP system? *

a. Alex uses a sophisticated information system to keep track of all the financial data generated
by her bakery. She is considering opening a new bakery on east side of her town.
b. Betty has a system that keeps track of the accounts payable and receivable for her plumbing
business. At the end of the year, it allows her to prepare her taxes in two hours.
c. Charlie keeps records of all his business expenses in a shoe box. Each week enters all of the
data into spreadsheets that automatically generate orders based on preset inventory triggers.
Production quotas for the coming week are also automatically generated by customer orders.
d. Doug is a free-lance photographer. He keeps records of all expenses and revenues on his cell
phone and then emails them to himself every month. The files are stored on his personal
computer and backed up to CD quarterly.

Is a collection of hardware, software, data, people, and procedures designed to

support data-intensive applications and generate information that supports the day-to-
day, short-range, and long-range activities of users in an organization *
a. SAP Business One
b. Information System
c. Enterprise Resource Planning
d. Accounting Information System
e. Management Information System

Which of the following is not one of the four types of file processing? *
a. Altering
b. Deleting
c. Updating
d. Changing

What is a primary example of source data automation? *

a. A utility bill
b. A bill of lading
c. A subsidiary ledger
d. POS (point-of-sale) scanners in retail stores

Accessing SAP Business One on Cloud is done using _____________ like Google
Chrome, Mozilla Firefox or Safari. *
a. Tool Bar
b. Menu Bar
c. Modules Menu
d. Web Browsers
Is a system that manipulates data according to a set of instructions *
a. Computer
b. Information Technology
c. Enterprise Resource Planning
d. Accounting Information System

Which of these statements is true regarding a standard user and their password? *
a. Password management is automatically controlled in the BIOS.
b. Once a standard user sets their first password they cannot change or modify it.
c. Standard users must get permission from the administrator to change a password.
d. Standard users can change their own password but cannot change anyone else's password.

Inventory items are often coded with these *

a. Block codes
b. Group codes
c. Sequence codes
d. Hierarchical codes

Businesses usually use some type of documents in the data input step of the data
processing cycle. Documents that are sent to the customers or suppliers and then
back to the organization in the course of a business transaction are known as *
a. Source documents.
b. Source data automation.
c. Turnaround documents.
d. Rubber or bounce- back documents.

Common source documents for the revenue cycle include all of the following except *
a. Sales order.
b. Credit memo
c. Delivery ticket.
d. Receiving report.

The systematic assignment of numbers or letters to items to classify and organize

them is known as *
a. Coding
b. Data input
c. Chart of accounts
d. Pre- numbered documents

This function in a form is being used to look up business partner and item information
while you are entering sales and purchasing documents. This function is also available
in the business partner and item number fields in marketing documents. Then once
the list appears, you can scroll through the list or use characters with wildcards to
search *
a. Add Mode
b. Find Mode
c. Link Arrow
d. Selection List
e. Dropdown List