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Part 2 of 5 -
20.0/ 30.0 Points
Question 7 of 30
5.0/ 5.0 Points
Communicating information to external decision makers is accomplished through ___ as part of the process of ___.
A. Financial statements, bookkeeping

B. Financial statements, accounting
C. Journal entries, bookkeeping
D. Journal entries, accounting
Answer Key: B
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Question 8 of 30
5.0/ 5.0 Points
Human judgment is important in which of the following AIS tasks: (i) designing source documents, (ii) recognizing recordable transactions.
A. I only
B. II only

C. Both I and II
D. Neither I nor II
Answer Key: C
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Question 9 of 30
0.0/ 5.0 Points
Courses intended for freshmen at a local university are numbered from 100 to 199, while courses intended for seniors at the same university are numbered from 400 to 499. Which coding system is the university using?
A. Sequential
B. Block

C. Hierarchical
D. Mnemonic
Answer Key: B
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Question 10 of 30
5.0/ 5.0 Points
As an internal control measure in the accounting cycle, physical security most clearly applies to:

A. Source documents
B. The balance sheet
C. The income statement
D. The statement of cash flows
Answer Key: A
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Question 11 of 30
5.0/ 5.0 Points
Which of the following most clearly differentiates accounting and bookkeeping?
A. Bookkeeping always involves information technology; accounting does not.
B. Accounting always involves information technology; bookkeeping does not.

C. Bookkeeping is the part of accounting most focused on rules and procedures.
D. A college degree is required for bookkeeping, but not for accounting.
Answer Key: C
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Question 12 of 30
0.0/ 5.0 Points
NTR Corporation has offices in both Los Angeles and San Francisco. In the Los Angeles office, the account number for cash is 001.101. In San Francisco, the account number for cash is 002.101. Which of the following statements is most true?

A. NTR uses sequential coding for its chart of accounts.
B. One of the offices should change its account number for cash to promote consistency and efficiency.
C. The first set of digits denotes the office.
D. The second set of digits denotes the office.
Answer Key: C
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Part 3 of 5 -
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Question 13 of 30
5.0/ 5.0 Points
Internal control has four major purposes in organizations. Ways to achieve at least one of the four include: (i) keeping cash in a bank, (ii) conducting a new employee orientation.
A. I only.
B. II only.

C. Both I and II.
D. Neither I nor II.
Answer Key: C
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Question 14 of 30
5.0/ 5.0 Points
Consider the following list of items that might appear in a risk / control matrix:
i. At least twice a week ii. Corrective iii. Human error iv. Inability to access class materials due to network outage v. Insufficient time to study vi. Local data backup vii. Maximum budget = $50 viii. Preventive ix. Systems
x. Time management software
Which of the following items are most likely to be grouped on a single row?
A. I, II, III, IV, V
B. I, III, VII, VIII, X
C. III, V, VII, VIII, X

D. III, VI, VII, VIII, X
Answer Key: D
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Question 15 of 30
0.0/ 5.0 Points
The risk / control matrix illustrated in the chapter contains five columns. Which of the following is not one of them?

A. Risk
B. Risk category
C. COSO category
D. Internal control
Answer Key: C
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Question 16 of 30
5.0/ 5.0 Points
Consider the following examples of risk: i. A corporation is unable to issue bonds because its credit rating is too low. ii. A U.S. auto manufacturer tries to market a car in Mexico. The car does not sell because the Spanish translation of its name means “it doesn’t go.” iii. An employee receives insufficient training in how to use specialized software. iv. Due to employee theft, a corporation spends more than anticipated buying new tools
The risks listed above contain examples of all the categories in Brown’s risk taxonomy except:
A. Financial
B. Operational
C. Strategic

D. Hazard
Answer Key: D
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Question 17 of 30
0.0/ 5.0 Points
According to the COSO definition, internal control should promote ___ in financial reporting.
A. Truth

B. Accuracy
C. Both A and B
D. Neither A nor B
Answer Key: D
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Question 18 of 30
5.0/ 5.0 Points
A well-designed set of internal controls helps a company achieve four main purposes. Which of the following best pairs two controls related to a single purpose?

A. Restrictive endorsements and bank reconciliations
B. Restrictive endorsements and pre-numbered documents (such as checks)
C. Bank reconciliations and background checks
D. Pre-numbered documents and background checks
Answer Key: A
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Part 4 of 5 -
25.0/ 30.0 Points
Question 19 of 30
5.0/ 5.0 Points
Erin has maintained a very high GPA throughout her accounting education, but wonders if that GPA will ensure that she gets a good job. In terms of expectancy theory, Erin is most concerned about:
A. Expectancy

B. Instrumentality
C. Valence
D. Utility
Answer Key: B
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Question 20 of 30
5.0/ 5.0 Points
According to expectancy theory, motivation is determined by three factors. Which of the following is not one of the three factors?

A. Energy
B. Expectancy
C. Valence
D. Instrumentality
Answer Key: A
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Question 21 of 30
0.0/ 5.0 Points
Which of the following best pairs an element of the COSO enterprise risk management framework with an example of that element?

A. Control activities, developing a budget for the ERM plan
B. Information and communication, annual management retreats focused on the ERM plan
C. Monitoring, annual management retreats focused on the ERM plan
D. Internal environment, posting SEC filings on the company web site
Answer Key: C
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Question 22 of 30
5.0/ 5.0 Points
One of the steps in the generalized model of business process management discussed in the text focuses on collecting process-related data. If Laurie and Milton are concerned about the risks created by inefficiency in the company’s current fixed asset purchasing process, they could collect data related to: (i) the average length of time between an order for a fixed asset and its delivery, (ii) the costs incurred in the fixed asset purchasing process.
A. I only
B. II only

C. Both I and II
D. Neither I nor II
Answer Key: C
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Question 23 of 30
5.0/ 5.0 Points
Which of the following best paraphrases one of the basic principles of business process management discussed in the text?

A. Determine how business processes interact with the way an organization competes in its markets.
B. Gain cooperation from middle management if possible.
C. Look for reasons to keep processes the same if at all possible.
D. Ensure the company has the right information technology tools for the job.
Answer Key: A
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Question 24 of 30
5.0/ 5.0 Points
A method of efficiently aligning an organization with the wants and needs of clients is a definition of:

A. Business process management
B. Enterprise risk management
C. Internal control
D. Expectancy theory
Answer Key: A
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Part 5 of 5 -
5.0/ 30.0 Points
Question 25 of 30
0.0/ 5.0 Points
Anna and Melinda were choosing a new general ledger system for the company they own. They decided to use three factors for the evaluation: adaptability, strategic fit and training. They considered training three times more important than strategic fit; they considered adaptability twice as important as strategic fit. To keep their evaluation simple, they assigned a weight of “1” to strategic fit. If software package B had scores of 3 on adaptability, 6 on strategic fit and 8 on training, its score using the weighted-rating technique will be:
A. 6.
B. 12.
C. 36.

D. Some other number.
Answer Key: C
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Question 26 of 30
5.0/ 5.0 Points
Which of the following statements would you expect to read in a company memo advocating the use of the systems development life cycle to select general ledger software?
A. There are ten steps in the accounting cycle.

B. Using the SDLC can help ensure reliable financial reporting.
C. Most accounting information systems have five generic parts.
D. General ledger software assists more with bookkeeping than it does with accounting.
Answer Key: B
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Question 27 of 30
0.0/ 5.0 Points
The chapter discussed four macro-level and four micro-level factors that should be considered when evaluating information technology for use in the accounting information system. It also discussed Sylla and Wen’s three-stage process for evaluating information technology investments. Which of the following best pairs a micro-level factor with a level from the Sylla and Wen framework?
A. Strategic fit, intangible benefits evaluation

B. Cost, tangible benefits evaluation
C. Both A and B
D. Neither A nor B
Answer Key: D
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Question 28 of 30
0.0/ 5.0 Points
Liam has developed a good process for safeguarding his company’s information technology assets. He has talked about his methodology with some of his co-workers and has created a schedule for applying his process to various kinds of information technology assets. Using the capability maturity model, the process is best described as:

A. Chaotic
B. Repeatable
C. Managed
D. Optimized
Answer Key: B
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Question 29 of 30
0.0/ 5.0 Points
Sylla and Wen suggested a three-stage process for evaluating information technology investments. Which step in the process is most closely aligned with the “internal environment” component of the COSO internal control and enterprise risk management frameworks?
A. Step 1
B. Step 2
C. Step 3

D. None of the above; there is no relationship between the Sylla and Wen process and the COSO frameworks.
Answer Key: A
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Question 30 of 30
0.0/ 5.0 Points
One advantage of the systems development life cycle is its opportunity for user input. It therefore shares some commonalities with which elements of the COSO enterprise risk management framework?
A. Internal environment and risk response
B. Event identification and information and communication
C. Event identification and risk response

D. Internal environment and information and communication
Answer Key: C
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