Organization Ownership: Separate
Generally Accepted accounting principles
a physical characteristic (fingerprint, voice, etc.) used to authenticate the identity of a user.
Organization Transfer of Ownership: Near to impossible
information required to conduct business with external parties (such as purchase orders and customer billings)
Normal text that hasn't been encrypted.
|Define COST CENTER.||
Manager only controls cost
transactions that acquire or dispose of long-lived assets-assets that the company expects to provide services for more than a year (What type of activity?)
The total amount charged to customers for merchandise sold, including cash sales and sales on account.
used to record infrequent or non-routine transactions, such as loan payments and end-of-period adjusting and closing entries
Automated tools designed to identify whether a given system possesses any well-known vulnerabilities.
Software routines that search a program for the occurrence of a particular name or other combination of characters.
|Define appraisal costs.||
costs of finding defects (inspections)
The dimension of feasibility that determines if there will be any conflicts between the system under consideration and the organization's ability to discharge its legal obligation.
|overstated ending inventory||
inventory, working capital, current ratio, and net income are overstated and cost of goods sold is understated
|Partnership (Earnings Taxed)||
Organization Earnings Taxed: Once at personal rates
Revenue from sources other than the primary operating activity of a business (interest, rent, and gains resulting from the sale of fixed assets)
an event where two entities exchange items such as cash for goods or services
A technique used to obtain detailed knowledge of the logic of an application program as well as to test the program's compliance with its control specifications.
|Vendor Managed Inventory (VMI)||
When manufacturers and distributors manage a retail customer's inventory using an EDI.
|Define PROFIT CENTER.||
Manager controls both revenues and costs.
The phase of the systems development life cycle in which the designer specifies the hardware, software, and procedures for delivering the conceptual systems design.
A document that records details about each delivery, including the date received, shipper, vendor, and purchase order number.
companies may apply this method using one composite rate that reflects an estimate of the uncollectible receivables. Or, companies may set up an aging schedule of accounts receivable, which applies a different percentage based on past experience to the various age categories; balance sheet approach; results in a more accurate valuation of receivables on the balance sheet
D/A= $10,000 credit before AJE
10% of A/R balance will be uncollectible
500,000 X .10= $50,000
AJE[Bad debt exp $40,000
$5,000 become collectible
|perpetual inventory system||
continuously tracks changes in the Inventory account; a company records all purchases and sales (issues) of goods directly in the inventory account as they occur
provides a continuous record of the balances in both the Inventory account and the Cost of Goods sold account
|Accumulated depreciation (Asset)||
the cumulative estimate of the amount tangible assets were used up
|periodic inventory system||
The inventory system in which the inventory records do not show the amount available for sale or sold during the period.
A component of data flow diagram that represents the people and organizations that send data that the system being modeled uses or produces
|Stateful Packet Filtering||
A technique employed by firewalls in which a table is maintained that lists all established connections between the organization's computers and the Internet. The firewall consults this table to determine whether an incoming packet is part of an ongoing communication initiated by an internal computer.
|Human Resources Management (HRM)/Payroll Cycle||
The recurring set of business activities and related data processing operations associated with effectively managing the employee workforce.
a report listing the amount of gross pay, deductions, and net pay for the current period; year to date totals for each category are also listed
|Capital Budgeting Model||
An estimate of funds to be appropriated for the acquisition of major capital assets and for investment in long-term projects. The estimated benefits are compared with the costs to determine if the system is cost beneficial.
|sale without recourse||
the purchaser assumes the risk of collectibility and absorbs any credit losses
is an outright sale of the receivables both in form (transfer of title) and substance (transfer of control)
generate CFs quickly, high risk of nonpayment
EX: sell $100,000 of receivables to a factor
factor-finance charge= 1%
make a deposit= 2%
[Finance charge $1,000
[Due from factor $2,000
[Accounts (notes) receivable $100,000
|o BE ($)||
Fixed Expenses / CM ratio â CM/ selling price.
the actual value stored in a field. it describes a particular attribute of an entity
|What profit level should a manager be evaluated on?||
Margin in control
|Issues in accounting for accounts and notes receivable||
recognition, valuation, and disposition
|purchase returns and allowances||
An account used to record all returns and allowances received by the business. It can also be used to track the history of supplier problems.
|Electronic Funds Transfer (EFT)||
The transfer of funds between two or more organization or individuals using computers and other automated technology. Customers can send their remittances electronically to the company's bank and thus eliminate the delay associated with the time the remittance is in the mail.
|3 conditions met before company can record a sale||
transferred asset has been isolated from the transferor (put beyond reach of the transferor and its creditors)
transferees have obtained the right to pledge or exchange either the transferred assets or beneficial interests in the transferred assets
transferor does not maintain effective control over the transferred assets through an agreement to repurchase or redeem them before their maturity
|What are three aspects of a customer profitability analysis?||
-Analyzing customers on profit generated work and activities -Cater to your more profitable customers-Reduce handling costs of dealing with less profitable customers
|unrealized holding gain or loss||
is the net change in the fair value of the receivable from one period to another, exclusive of interest revenue recognized but not recorded. As a result, the company reports the receivable at fair value each reporting date. In addition, it reports the change in value as part of net income
Organization Ownership: Shared
International Accounting Standards Board
The workstations, servers, printers, and other devices that comprise the organizations network.
Ownership claims with no preferences
facts that are collected, recorder, stored, and processed by an information system to produce information
The process of transforming normal text, called plain-text, into unreadable gibberish, called cipher-text. It is particularly important when confidential data is being transmitted from remote terminals because data transmission lines can be electronically monitored without the user's knowledge.
all expenses associated with processing purchase transactions
Companies whose stock is traded publicly in the US are audited annually because of who?
determined when purschases returns and allowances and the purchases discounts are deducted from the total purchases
the recurring set of business activities and related data processing operations associated with the manufacture of products
An electronic document, created and digitally signed by a trusted third party, that certifies the identity of the owner of a particular public key. Contains that third party's public key. Thus they provide an automated method for obtaining an organization's or individual's public key.
A postal address to which customers send their remittances. This post office box is maintained by the participating bank, which picks up the checks each day and deposits them to the company's account. The bank sends the remittance advices, an electronic list of all remittances and digital copies of all checks to the company.
a method for processing accounts payable in which a disbursement voucher is prepared instead of posting invoices directly to vendor records in the accounts payable subsidiary ledger
The dimension of feasibility concerned with whether a proposed system can be developed given the available technology.
|five mgmt assertions||
assertions about: existence or occurrence, completeness, allowance or valuation, rights and obligations, presentation and disclosureECARP
|Merchandise Inventory (Asset)||
items to be sold to customers
Sales minus the cost of merchandise sold.
contain the initial record of a transaction that takes place. Examples: sales invoices, purchase orders, and employee time cards
An approach auditors use to detect unauthorized program changes and data processing accuracy. The auditor writes his or her own version of a program and then preprocesses data. The output of the auditor's program and the client's program are compared to verify that they are the same.
A document listing all checks received in the mail.
a recurring set of business activities and related data processing operations associated with the purchase of and payment for goods and services
Persons who develop, code, and test computer programs.
|Blanket Purchase Order||
A commitment to purchase specified items at designated prices from a particular supplier for a set time period, often one year.
|Sale with recourse||
seller guarantees payment to the purchaser in the even the debtor fails to pay; seller retains risk
EX:recourse liability determined=$10,000
[Finance Charge $11,000
[Due from factor $2,000
|dollar value of LIFO||
determines and measures any increases and decreases in a pool in terms of total dollar value, not the physical quantity of the goods in the inventory pool
may include a broader range of goods
permits replacement of goods that are similar items, similar in use, or interchangeable
|Land, investment (Asset)||
tangible assets that are not used up
Merchandise on hand (not sold) at the end of an accounting period.
a component of data flow diagrams that represents an entity outside of the system who receives data produced by the system,
The use of two or more authentication methods (passwords, ID badges, biometrics, etc.) in conjunction to achieve a greater level of securtiy.
A listing of payroll data for each employee for a payroll period.
|flexible benefits plan||
a plan under which each employee receives some minimum coverage in medical insurance and pension contributions plus additional benefit "credits" that can be used to acquire extra vacation time or additional health insurance the planes are sometimes called cafeteria-style benefit plans because they offer a menu of options
A bar graph used for project planning and control. Project activities are shown on the left, and units of time are shown across the top. The time period over which each activity is expected to be performed is represented with a horizontal bar on the graph.
|Raw materials inventory||
cost assigned to goods and materials on hang but not yet placed into production; can be traced directly to the end product
|Investing Decisions: Decrease in cash=||
increase in long-lived assets, loans and investments (Investing)
|business or transaction cycle||
a group of related business processes. the major business cycles are sales and marketing, purchasing and inventory control, production, human resources and payroll and finance
|Define COST ALLOCATION.||
The process of assigning the costs in a cost pool to the cost objectives
|LIFO conformity rule||
if a company uses LIFO for tax purposes, it must also use LIFO for financial accounting purposes
|cost of merchandise sold||
The cost that is reported as an expense when merchandise or a manufactured product is sold; also called cost of goods sold.
|What is the first thing you calculate in the Order of Operational Budgets?||
Sales budge and services
|LIFO (last-in, first-out) method||
matches the cost of the last goods purchased against revenue
use LIFO for tax and external reporting purposes
doesn't have good valuation of EI
current costs matched with current revenues
|Which of the following inventory control methods is most likely to be used by a company that purchases inventory in response to customer orders?a. JITb. EOQc. MRPd. ABC||
answer:a. JIT JIT seeks to minimize inventory by only making purchases after sales
|What is the equation used in finding the BUDGET PRODUCTION?||
Sales units - Beginning + Ending = PRODUCTION*NOTE: Do this for all the months. Last mo.'s ending is next mo.'s beginning