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SSAE 16 is a form of ___ with respect to an ASP.
A. internal control
B. information technology
C. Both internal control and information technology
D. Neither internal control nor information technology
Consider the following case as you respond to the questions:
HSO Corp. designs, manufactures and sells golf carts, scooters and similar vehicles.
When a prospective client contacts one of their seven corporate offices, the office
manager fills out an "intake questionnaire" to determine if HSO can meet the
prospective client's needs. The office manager assembles a team of employees with
expertise in design, production, marketing and accounting; the team reviews the intake
questionnaire and determines if HSO can take on the order. If so, the office manager
prepares a three-page written proposal for the prospective client; the proposal explains
the responsibilities of both HSO and the client, along with a timeline and a budget. The
proposal is forwarded to the prospective client electronically, and the client has ten
calendar days to accept it. If HSO cannot take on the order, the prospective client
receives an automatically generated form letter; if the prospective client does not accept
the proposal within ten calendar days, they receive a different form letter. The new
client remits half of the fee at the time the proposal is accepted, and HSO prepares
weekly progress reports as the project moves forward. The reports are filed in HSO's
database; a hard copy is sent to the client. On a monthly basis, HSO's office manager
prepares a comprehensive status report for all current engagements. One week before
each project is concluded, HSO bills the client for half of the remaining amount due;
after the client has paid all outstanding invoices, HSO completes the work and bills the
client for all remaining amounts. HSO delivers the finished product; the client must pay
the full amount due within 30 days of the final invoice date. If the client pays within 15
days, HSO gives a 3% discount off the amount due.
On April 1 of the current year, EPL Corporation accepted a three-page written proposal
from HSO to design and build 10 customized golf carts for EPL's internal use. The total
price for the order was $3400. Which of the following would be considered a derivable
amount?
A. The total cost for HSO to manufacture the golf carts
B. The balance in EPL's equipment account
C. The balance in EPL's cash account
D. All of these
Consider the following systems flowchart as you respond to the question:
In the flowchart, the vendor:
A. Is outside the system boundary and therefore should be omitted.
B. Should be omitted because it has too few symbols in its column.
C. Is exposed to credit risk.
D. Should not ship goods before generating an invoice.
The Audit Clarity Project's objectives include:
A. making auditing standards easier to read.
B. converging US auditing standards with international auditing standards.
C. Both making auditing standards easier to read and converging US auditing standards
with international auditing standards.
D. Neither making auditing standards easier to read nor converging US auditing
standards with international auditing standards.
Consider the following independent situations as you answer the questions:
a. Irene, a freshman accounting major, thought she would benefit from reading an
intermediate accounting text while taking introductory financial accounting.
b. Bradley developed a plan to study for all four parts of the CPA exam during his last
semester at college, thus making himself ready to take the exam immediately after
graduation.
c. Jorge met weekly with a group of five students, all of whom were preparing their
resume for the very first time.
d. Every time Maria encountered a topic she did not understand in her accounting
information systems course, she did a Google search for it.
Which decision makers are experiencing information overload due to information
characteristics?A. Irene only.B. Bradley onlyC. Both Irene and BradleyD. Neither Irene
nor Bradley Irene, information characteristics.
An organization is at the "chaotic" level of the capability maturity model. If it attempts
to implement an ERP system, which of the following is most likely to cause the
implementation to fail?
A. A bad match between ERP software and organizational processes.
B. Significant technical difficulties.
C. Both a bad match between ERP software and organizational processes and
significant technical difficulties.
D. Neither a bad match between ERP software and organizational processes nor
significant technical difficulties.
Booksellers of Bufluffia is a small, independent bookstore that both publishes and sells
very specialized titles. They currently have about 50 clients; they publish and sell 30
different books at present. The company's management has asked you to create database
tables to support their operations. Suppose the database includes four tables: clients,
inventory, sales and sales/inventory. In which table(s) would you expect to see a field
labeled "client ID?"
A. Clients table only
B. Sales table only
C. Both clients table only and sales table only
D. Neither clients table only nor sales table only
According to COBIT 5, an organization's information technology governance and
management should separate governance from management. In that context, examples
of management include:
A. developing a comprehensive organizational budget.
B. deciding the dollar amount of an upcoming dividend.
C. Both developing a comprehensive organizational budget and deciding the dollar
amount of an upcoming dividend.D. Neither developing a comprehensive
organizational budget nor deciding the dollar amount of an upcoming dividend.
SCP Corporation purchased inventory on account from OBP Corporation. Which of the
following occurred first?
A. The first step in OBP's sales/collection process
B. The first step in SCP's acquisition/payment process
C. A value chain analysis of the transaction
D. Management approval of the transaction
Which of the following best pairs a characteristic of a professional with an example of
that characteristic?
A. Communicates effectively, selects software using the weighted-rating model
B. Integrates knowledge from many disciplines, completes the steps in the systems
development life cycle
C. Communicates effectively, analyzes internal controls in the sales/collection process
D. Integrates knowledge from many disciplines, gives two examples of COSO
documents
The risk/control matrix illustrated in the chapter contains five columns. Which of the
following items is most likely to appear in the third column?
A. Downloading a virus
B. Preventive
C. Systems
D. Virus protection software
Internal control relates to an organization's achievement of objectives in three major
categories. Which of the following pairs gives an example of two controls that fulfill a
single category?
A. Fulfilling the requirements of the Foreign Corrupt Practices Act, developing a clear
job description for each position in the company
B. Developing a clear job description for each position in the company, calculating
profits on the accrual basis
C. Fulfilling the requirements of the Foreign Corrupt Practices Act, calculating profits
on the accrual basis
D. Ensuring that plant assets are listed on the balance sheet at their net book value,
listing appropriate assets at their current market value
Consider the following diagram as you answer the questions:
The smallest number of interviews an applicant may have is:
A. zero
B. one
C. many
D. not determinable based on the model.
Ethics is a discipline that:
A. Studies values and guidelines for living.
B. Explains why ethical egoism is the best school of ethical thought.
C. Both studies values and guidelines for living and explains why ethical egoism is the
best school of ethical thought.
D. Neither studies values and guidelines for living nor explains why ethical egoism is
the best school of ethical thought.
Consider the following flowchart symbols as necessary as you respond to the remaining
questions in this chapter:
Symbol A depicts:
A. A decision.
B. A terminator.
C. A document.
D. A predefined process.
Consider the following partially completed flowchart as you respond to the questions:
In the partial flowchart, "C" should be replaced with:
A. applicant name
B. position description
C. rejection letter
D. file application materials
Expectancy theory is most likely to be helpful in addressing which of the following
common causes of ERP implementation failure?
A. Poor leadership from top management
B. Automating existing redundant processes
C. Inaccurate data in the system
D. Significant technical difficulties
