Question 1

Input devices are the means to make accounting information available to users.

Accepted Answer

A) True 
 B)False

Question 2

Doughton Furniture Company purchased merchandise on credit from Furniture Supply for $8,000. Two days later Doughton returned $2,000 of the merchandise due to damage. When Doughton pays for the merchandise minus the return, it would record the payment in the:

Accepted Answer

A)  General journal.
B)  Purchases journal.
C)  Cash disbursements journal.
D)  Cash receipts journal.
E)  Accounts Payable controlling account.F) B) and E)
G) B) and C)

Question 3

Wildlife Wholesale Supply sold birdseed to a retailer for $860, receiving cash at the time of sale. The cost of the birdseed was $370. When recording the collection from the customer, in its cash receipts journal, Wildlife would enter:

Accepted Answer

A)  $860 in the Cash Dr. column; $860 in the Sales Cr. column; and $370 in the Cost of Goods Sold Dr./Inventory Cr. column.
B)  $860 in the Cash Dr. column; $860 in the Sales Cr. column; and $370 in the Other Accounts Cr. column.
C)  $370 in the Cash Dr. column and $370 in the Accounts Receivable Cr. column.
D)  $860 in the Accounts Receivable Dr. column, $860 in the Cash Cr. column; and $370 in the Cost of Goods Sold Dr./Inventory Cr. column.
E)  $860 in the Cash Dr. column and $860 in the Accounts Receivable Cr. column.F) None of the above
G) C) and D)

Question 4

A business segment is a part of a company that is separately identified by its products or services, or by the geographic market it serves.

Accepted Answer

A) True 
 B)False

Question 5

A company makes a payment of $5,000 on a long-term note payable. The journal the transaction would be recorded in is the:

Accepted Answer

A)  Cash receipts journal.
B)  General journal.
C)  Sales journal.
D)  Cash disbursements journal.
E)  Purchases journal.F) B) and C)
G) C) and D)

Question 6

Accounting information systems collect and process data from transactions and events, organize them in useful reports, and communicate results to decision makers.

Accepted Answer

A) True 
 B)False

Question 7

List the five basic principles of accounting information systems.

Accepted Answer

The five main principles by wh...

Question 8

A company sells merchandise on credit for $6,000. The merchandise cost is $3,400. The journal that the transaction would be recorded in is the:

Accepted Answer

A)  Cash disbursements journal.
B)  Sales journal.
C)  Purchases journal.
D)  Cash receipts journal.
E)  General journal.F) C) and E)
G) B) and C)

Question 9

Maxie's Game World sold games to a customer on credit for $2,600, terms 1/10, n/30 and the cost of the games was $1,700. When recording the collection from the customer made within the discount period, in its cash receipts journal, Maxie's would enter:

Accepted Answer

A)  $2,600 in the Cash Dr. column. $2,600 in the Sales Cr. column, and $1,700 in the Cost of Goods Sold Dr./Inventory Cr. column.
B)  $2,574 in the Cash Dr. column, $26 in the Sales Discount Dr. column and $2,600 in the Accounts Receivable Cr. column.
C)  $2,574 in the Cash Dr. column and $2,574 in the Accounts Receivable Cr. column.
D)  $2,600 in the Cash Dr. column and $2,600 in the Accounts Receivable Cr. column.
E)  $2,600 in the Accounts Receivable Dr./Sales Cr. column and $2,600 in the Cash Cr. column.F) B) and D)
G) None of the above

Question 10

If the total balance of the accounts payable ledger equals the total of the controlling Accounts Payable account, then the accounts are presumed to be correct.

Accepted Answer

A) True 
 B)False

Question 11

A procedure called direct posting of sales invoices involves posting sales directly to the customer accounts in the accounts receivable ledger, making a period end journal entry, and avoiding the use of the sales journal.

Accepted Answer

A) True 
 B)False

Question 12

If a company purchases $15,200 of merchandise on credit, which journal will the transaction be recorded in?

Accepted Answer

A)  Purchases journal.
B)  General journal.
C)  Cash disbursements journal.
D)  Cash receipts journal.
E)  Sales journal.F) C) and E)
G) B) and E)

Question 13

Segment information is not helpful to investors for evaluating a company's profitability, risk, or growth.

Accepted Answer

A) True 
 B)False

Question 14

Alex Reagent, owner of Delectable Candy Company, understands that accounting systems are important for success. Explain how Alex can use the accounting system to assess business operations.

Accepted Answer

The accounting system can be used to mea...

Question 15

The accounts receivable ledger:

Accepted Answer

A)  Is also the controlling account.
B)  Stores transaction data for individual creditors.
C)  Is a substitute for the sales journal.
D)  Is a substitute for the cash receipts journal.
E)  Stores transaction data for individual customers.F) A) and B)
G) C) and E)

Question 16

Two common subsidiary ledgers are cash receipts and cash disbursements.

Accepted Answer

A) True 
 B)False

Question 17

The basic components of an accounting information system include all of the following except:

Accepted Answer

A)  Source documents.
B)  Information storage.
C)  Warehouses.
D)  Information processors.
E)  Output devices.F) A) and C)
G) None of the above

Question 18

A special journal is used to record and post transactions of a similar type.

Accepted Answer

A) True 
 B)False

Question 19

Alani's Hawaiian segment had revenues of $2,075 million, operating income of $1,500 million, and average assets of $1,450 million. The Hawaiian segment return on assets is:

Accepted Answer

A)  138.3%
B)  69.9%
C)  96.7%
D)  72.3%
E)  103.4%F) None of the above
G) A) and E)

Question 20

Enterprise-resource planning software:

Accepted Answer

A)  Uses batch processing of business information.
B)  Is another name for spreadsheet programs.
C)  Refers to programs that help manage a company's vital operations.
D)  Is substantially declining in use.
E)  Is another name for database programs.F) A) and C)
G) B) and D)

Exam 7: Accounting Information Systems

The basic components of an accounting information system include all of the following except:

Correct AnswerverifiedShow Answer

Alex Reagent, owner of Delectable Candy Company, understands that accounting systems are important for success. Explain how Alex can use the accounting system to assess business operations.

Correct AnswerverifiedThe accounting system can be used to mea...View AnswerShow Answer

If the total balance of the accounts payable ledger equals the total of the controlling Accounts Payable account, then the accounts are presumed to be correct.

Correct AnswerverifiedShow Answer

A procedure called direct posting of sales invoices involves posting sales directly to the customer accounts in the accounts receivable ledger, making a period end journal entry, and avoiding the use of the sales journal.

Correct AnswerverifiedShow Answer

Two common subsidiary ledgers are cash receipts and cash disbursements.

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Enterprise-resource planning software:

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Segment information is not helpful to investors for evaluating a company's profitability, risk, or growth.

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Maxie's Game World sold games to a customer on credit for $2,600, terms 1/10, n/30 and the cost of the games was $1,700. When recording the collection from the customer made within the discount period, in its cash receipts journal, Maxie's would enter:

Correct AnswerverifiedShow Answer

Wildlife Wholesale Supply sold birdseed to a retailer for $860, receiving cash at the time of sale. The cost of the birdseed was $370. When recording the collection from the customer, in its cash receipts journal, Wildlife would enter:

Correct AnswerverifiedShow Answer

A company makes a payment of $5,000 on a long-term note payable. The journal the transaction would be recorded in is the:

Correct AnswerverifiedShow Answer

A company sells merchandise on credit for $6,000. The merchandise cost is $3,400. The journal that the transaction would be recorded in is the:

Correct AnswerverifiedShow Answer

Accounting information systems collect and process data from transactions and events, organize them in useful reports, and communicate results to decision makers.

Correct AnswerverifiedShow Answer

If a company purchases $15,200 of merchandise on credit, which journal will the transaction be recorded in?

Correct AnswerverifiedShow Answer

List the five basic principles of accounting information systems.

Correct AnswerverifiedThe five main principles by wh...View AnswerShow Answer

Doughton Furniture Company purchased merchandise on credit from Furniture Supply for $8,000. Two days later Doughton returned $2,000 of the merchandise due to damage. When Doughton pays for the merchandise minus the return, it would record the payment in the:

Correct AnswerverifiedShow Answer

Alani's Hawaiian segment had revenues of $2,075 million, operating income of $1,500 million, and average assets of $1,450 million. The Hawaiian segment return on assets is:

Correct AnswerverifiedShow Answer

A business segment is a part of a company that is separately identified by its products or services, or by the geographic market it serves.

Correct AnswerverifiedShow Answer

A special journal is used to record and post transactions of a similar type.

Correct AnswerverifiedShow Answer

The accounts receivable ledger:

Correct AnswerverifiedShow Answer

Input devices are the means to make accounting information available to users.

Correct AnswerverifiedShow Answer

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The accounting system can be used to mea...
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The five main principles by wh...
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