Chapter 2 Flashcards
(62 cards)
1
Q
A Financial Transaction is?
A
an economic event that affects the assets and equities of the firm, is reflected in its accounts, and is measured in monetary terms
2
Q
What are the three transaction cycles?
A
- Expenditure cycle
- Conversion cycle
- Revenue cycle
3
Q
What are the subsystems under Expenditure Cycle?
A
- Purchasing/ Ap
- Cash Disbursements
- Payroll
- Fixed Assets
4
Q
What are the subsystems under Conversion cycle?
A
- Production Planning and Control
- Cost Accounting
5
Q
What are the subsystems under Revenue cycle?
A
- Sales Order Processing
- Cash Receipts
6
Q
Expenditure Cycle? It is time lag between the two due to credit relations
with suppliers
A
- physical component (acquisition of goods)
- financial component (cash disbursements to the supplier)
7
Q
Two subsystem of Conversion Cycle?
A
- the production system (planning, scheduling, and control of the
physical product through the manufacturing process) - the cost accounting system (monitors the flow of cost
information related to production)
8
Q
Two subsystem of Revenue Cycle: time lag between the two due to credit relations with
customers :
A
- physical component (sales order processing)
- financial component (cash receipts)
9
Q
What are the three Manual System Accounting Records? (SPT)
A
- Source Documents
- Product Documents
3.Turnaround Documents
10
Q
It is used to capture and formalize transaction data needed for processing
A
Source Documents
11
Q
It is the result of transaction processing
A
Product Documents
12
Q
It is a product document of one system that becomes a source document for another system
A
Turnaround Documents
13
Q
What are two Manual Accountimg Records?
A
- Journal
- Ledger
14
Q
What is a journal?
A
a record of chronological entry
15
Q
What are two types of journal?
A
- special journals
2 general journal
16
Q
It is specific classes of transactions that occur in high frequency
A
special journals
17
Q
It is a nonrecurring, infrequent, and dissimilar transactions
A
general journal
18
Q
What is a ledger?
A
a book of financial accounts
19
Q
Two types of Ledger?
A
- general ledger
- subsidiary ledger
20
Q
It shows activity for each account listed on the chart of accounts
A
general ledger
21
Q
It shows activity by detail for each account type
A
subsidiary ledger
22
Q
What are types of Computer File? (MART)
A
- Master File
2.Transaction File - Reference File
- Archive File
23
Q
It is a file that generally contains account data (e.g., general ledger and subsidiary file)
A
Master File
24
Q
It is a file that temporary file containing transactions since the last update
A
Transaction File
25
It is a file that contains relatively constant
information used in processing (e.g., tax tables, customer addresses)
Reference File
26
It is a file that contains past transactions for
reference purposes
Archive File
27
5 Documentation Techniques (EDDSP)
1. Entity Relationship Diagram
2. Data Flow Diagrams
3. Document Flowcharts
4. System Flowcharts
5. Program Flowcharts
28
It is a documentation technique to represent the relationship between entities in a system.
Entity Relationship Diagram (ERD)
29
The REA model version of ERD is widely used
in AIS. REA uses 3 types of entities:
- resources (cash, raw materials)
- events (release of raw materials into the production
process)
- agents (inventory control clerk, vendor, production
worker)
30
It represents the numerical mapping between entities:
- one-to-one
- one-to-many
- many-to-many
Cardinalities
31
It use symbols to represent the processes, data sources,
data flows, and entities in a system
It also represent the logical elements of the system do not represent the physical system
Data Flow Diagrams (DFD)
32
It illustrate the relationship among processes and the
documents that flow between them
It contain more details than data flow diagrams
It clearly depict the separation of functions in a system
Documents Flowchars
33
This flowchart are used to represent the relationship between the
key elements--input sources, programs, and output
products--of computer systems
It depict the type of media being used (paper, magnetic
tape, magnetic disks, and terminals)
In practice, not much difference between document and system flowcharts
System Flowcharts…
34
Modern Systems versus Legacy Systems
Modern systems characteristics:
1. client-server based and process transactions in real time
2. use relational database tables
3. have high degree of process integration and data sharing
4. some are mainframe based and use batch processing
35
Modern Systems versus Legacy Systems
Legacy systems characteristics:
1. mainframe-based applications
2. batch oriented
3. early legacy systems use flat files for data storage
4. later legacy systems use hierarchical and network databases
5. data storage systems promote a single-user environment that
discourages information integration
36
Database Backup Procedures
•Destructive updates leave no ____.
backup
37
Database Backup Procedures
•To preserve adequate records, backup procedures must be
implemented, as shown below:
1. The master file being updated is copied as a___.
2. recovery program uses the backup to create a ___
1. backup.
2. pre-update version of the master file.
38
Computer-Based Accounting
Systems
Two broad classes of systems:
batch systems
real-time systems
39
A ____ is a group of similar transactions that are accumulated over time and then processed together.
batch
40
T or F?
The transactions must not be independent of one another
during the time period over which the transactions are
accumulated in order for batch processing to be
appropriate.
F. It is independent
41
A _____ exists between the event and the processing.
time lag
42
Steps in Batch Processing/Sequential File
Keystroke
Edit Run
Sort Run
Update Run
Backup Procedure
43
- source documents are transcribed by
clerks to magnetic tape for processing later
Keystroke
44
- identifies clerical errors in the batch and
places them into an error file
Edit Run
45
places the transaction file in the same
order as the master file using a primary key
Sort Run
46
- changes the value of appropriate fields
in the master file to reflect the transaction
Update Run
47
The original master continues to
exist and a new master file is created
Backup Procedure
48
Advantages of Batch
Processing
Organizations can ____ by grouping
large numbers of transactions into batches rather
than processing each event separately.
increase efficiency
49
Advantages of Batch
Processing
Batch processing ____over the
transaction process via control figures.
provides control
50
Real-Time Systems
__________ at the
moment the economic event occurs
process transactions individually
51
Real-Time Systems
have _______ between the economic event
and the processing
no time lag
52
Real-Time Systems
generally ______ than batch
processing since they require dedicated
processing capacity; however, these cost
differentials are decreasing
require greater resources
53
Real-Time Systems
oftentimes have ______
longer systems development
time
54
Why Do So Many AIS Use Batch Processing?
T or F?
AIS processing is characterized by high-volume,
independent transactions, such are recording cash
receipts checks received in the mail.
T
55
T or F?
The processing of such high-volume checks can not be done during an off-peak computer time.
False
It can done during an off-peak computer time.
56
T or F?
This is one reason why many use batch processing maybe done using real-time data collection.
T
57
DATA PROCESSING METHODS
Information Time Frame
—Processing takes place when the economic event occurs.
Real-Time
58
DATA PROCESSING METHODS
Information Time Frame
—Lag exists between time when the economic event occurs and when it is recorded.
Batch
59
Resources
—Generally, fewer resources (hardware, programming, training) are required.
Batch
60
DATA PROCESSING METHODS
Resources
—More resources are required than for batch processing.
Real-Time
61
DATA PROCESSING METHODS
Operational Efficiency
—Certain records are processed after the event to avoid operational delays.
Batch
62
DATA PROCESSING METHODS
Operational Efficiency
—All records pertaining to the event are processed immediately.
Real-Time
