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Exam 7: Accounting Information Systems

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Question 31

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Three transactions that would be recorded in the sales journal are: (1) recording sales taxes (2) recording sales returns and allowances and (3) recording purchases discounts.

A) True
B) False

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Question 32

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The difference in the sales journal between the perpetual and periodic inventory systems is a column to record ___________________________ and __________________ for each sale. This column is used in the perpetual system but not in the periodic.

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Cost of goods sold, ...

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Question 33

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The Woodview Company uses a sales journal, purchases journal, cash receipts journal, cash disbursements journal, and general journal. They use the periodic inventory method. The following transactions occurred during the month of December: Record these transactions using the journals below.

What is purpose of footing and crossfooting the column totals in special journals To foot a column of numbers is to add it.

Assume that a company using a purchases journal made an error in totaling the journal's accounts payable column. The error should be discovered:

A subsidiary ledger:

With on-line systems, all information storage should be off-line to protect the data.

The Woodview Company uses a sales journal, purchases journal, cash receipts journal, cash disbursements journal, and general journal. They use the perpetual method. The following transactions occurred during the current month of December: Record the above transactions into the appropriate journals shown below.

Discuss the differences in the special journals between a company using a perpetual inventory system and one using a periodic inventory system.

The purchases journal is used to record cash purchases of merchandise.

When the sales journal's column for accounts receivable and sales is totaled at the end of the month, its total is:

The accounting principle that prescribes an accounting information system conform with a company's activities, personnel, and structure is the:

Which of the following does not apply to enterprise resource planning (ERP) software:

Segment return on assets is segment operating income divided by segment average assets.

Accounting information systems are so accurate that decision makers in practice do not need a basic knowledge of how the systems work.

Internal controls include policies to direct operations toward common goals, procedures to ensure reliable financial reports, safeguards to protect company assets and methods to achieve compliance with laws and regulations.

A company using the periodic inventory system does not record the increase in cost of goods sold and decrease in inventory at the time of each sale in the sales journal.

Off-the-shelf accounting software is not adequate to meet the needs of small businesses.

The following information is available for Bosc, Inc. (all amounts are in millions): a. Determine the segment return on assets for each geographic segment. b. Comment on the results. How do the segments compare with respect to profitability?

The cost-benefit principle prescribes that the benefits from an activity in an accounting information system outweigh the costs of that activity.