Solutions to REVIEW QUESTIONS –Chapter 1 1. An accounting information system is a collection of resources designed to provide data to a variety of decision makers according to their needs and entitlement. 2. The users of accounting information fall into two broad groups: external and internal. External users include stockholders, investors, creditors, government agencies, customers and vendors, competitors, labor unions, and the public at large. Internal users are the managers in an organization. 3. Electronic data processing (EDP) is the use of computer technology to perform an organization's transaction-oriented data processing. Management information systems (MIS) use computer technology to provide decision-oriented information to managers. In a decision support system (DSS), data are processed into a decision-making format for the end user. An expert system (ES) is a knowledgebased information system that uses its knowledge about a specific application area to act as an expert consultant to end users. 4. The four common operating cycles of business activity are the revenue cycle, expenditure cycle, production cycle, and finance cycle. 5. The term internal control suggests actions taken within an organization to regulate and direct the activities of the organization. 6. A controller is in charge of the accounting function. The treasurer is responsible for the finances of the business. 7. Internal audit is charged with monitoring and assessing compliance with organizational policies and procedures. 8. The most prevalent information systems departmental structure is the assignment of responsibilities and duties by area of technical specialization, that is, function. 9. The analysis function focuses on identifying problems and projects for computer processing and designing systems to satisfy these problems' requirements.