D217 Accounting Information Systems - Set 1 - Part 1

Correct Answer: Data redundancy

The flat-file approach leads to data redundancy, where the same data is stored in multiple locations, increasing storage costs and the likelihood of inconsistencies.

Correct Answer: The inability to determine what data is available

In a flat-file system, data is often scattered across multiple files, making it difficult to know what data exists or where it is located.

Correct Answer: Internal view

The internal view describes how the data is physically arranged and stored within the database system.

Correct Answer: The user view

Different users may require different views of the data, and the user view provides this customization.

Correct Answer: Occurs because of data redundancy

In unnormalized tables, redundant data can cause update anomalies where a change in one location doesn’t automatically reflect in others.

Correct Answer: May result in the loss of important data

In an unnormalized table, deleting certain data may unintentionally remove related information that is still needed.

Correct Answer: Customer purchase order

The customer purchase order triggers the revenue cycle by initiating the process of fulfilling an order.

Correct Answer: Accounts payable

Accounts payable is involved in the expenditure cycle, managing payments to vendors, not the revenue cycle.

Correct Answer: Bill the customer

The sales invoice is used to bill the customer for products or services sold.

Correct Answer: Supervision

Supervision is a compensating control when other stronger controls cannot be implemented effectively.

Correct Answer: Transfer of information among modules occurs automatically

In integrated systems, data flows automatically between modules, reducing the risk of errors or missed steps.

Correct Answer: Supplier

The purchase order is sent to the supplier to confirm what is being ordered, the quantities, and the agreed prices.

Correct Answer: Accounts payable

Accounts payable completes the purchasing process by authorizing and making payments based on received goods.

Correct Answer: The liability account is decreased

Recording a payment reduces the liability account since the obligation to pay has been fulfilled.

Correct Answer: Accounts payable

There is a higher risk of misappropriation of funds in accounts payable due to potential fraudulent payments.

Correct Answer: Receiving

Supervision is essential in receiving to ensure goods are accurately recorded before they enter inventory.

Correct Answer: Purchase of a new plant

The fixed asset system tracks and records the purchase of long-term assets like plants and equipment.

Correct Answer: Cash disbursements

The cash disbursements department processes employee payments after approval from the payroll system.

Correct Answer: Comparing labor distribution summary to disbursement voucher

This reconciliation ensures that the payroll disbursement aligns with labor costs and the related accounting records.

Correct Answer: Supervisors distributing paychecks

Supervisors should not handle payroll distribution as it opens up the opportunity for manipulation or fraud.