Acct-1080-Exam-3-Study-Guide - Key Terms Definitions Direct Write-off Method and Allowance Method Which does GAAP require Cash Ratio What does a higher

Acct-1080-Exam-3-Study-Guide - Key Terms Definitions Direct...

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Key Terms & Definitions: Direct Write-off Method and Allowance Method. Which does GAAP require? Cash Ratio. What does a higher number indicate? Maturity Value of a Note is.. Acid Test Ratio Days Sales in Receivables A/R Turnover Ratio SAMPLE PROBLEMS: Chapter 7 Accounting Information Systems Learning Objective 7-1 An accounting information system (AIS) collects, records, stores, and processes accounting data to produce information that is useful for decision makers. Answer: TRUE An effective accounting information system with adequate internal controls can safeguard a business's assets and reduce the likelihood of fraud and errors. Answer: TRUE An accounting information system has three basic components: source documents and input devices, processing and storage, and outputs. Answer: TRUE Pre-numbered source documents provide necessary control in a system by automatically assigning a sequential number to each new transaction. Answer: TRUE A source document provides the evidence and data for accounting transactions. Answer: TRUE Which of the following is true of data processing and storage in a computerized information system? A) In a computerized accounting information system, processing includes manually journalizing transactions and posting to the accounts. B) In a computerized accounting information system, there will be a main centralized computer where data is stored, which cannot be accessed from any other computers. C) In both manual and computerized systems, all data are contained in paper documents and are often stored in filing cabinets and off-site document warehouses. D) In a computerized accounting information system, companies need to spend large amounts of cash to ensure that their data and information are secure. Answer: D The main computer where data is stored, which can be accessed from many different computers is known as a(n) ________. A) internet protocol B) RAM C) server
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D) router Answer: C Which of the following is an example of a storage device in an accounting information system? A) monitor B) network C) printer D) server Answer: D Which of the following is an input device in an accounting information system? A) keyboard B) internet protocol C) printer D) router Answer: A Which of the following is an output device in an accounting information system? A) keyboard B) internet protocol C) printer D) mouse Answer: C Which of the following is true of outputs in an accounting information system? A) In a manual system, reports and financial statements must be created using Word documents, Excel spreadsheets, or PowerPoint. B) In a computerized system, the software can generate reports instantaneously that can never be manipulated. C) Examples of outputs in an accounting information system include purchase invoices, bank checks, and sales invoices.
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