The accounting cycle comprises ten steps. In which step is an XBRL taxonomy first
likely to be used?
A. Post from the journal to the ledger.
B. Record the transactions in a journal.
C. Prepare financial statements.
D. Close the nominal accounts to retained earnings.
The generic steps associated with business process management can be useful in:
A. Strengthening internal controls in an accounting information system.
B. An operational audit.
C. Both strengthening internal controls in an accounting information system and an
operational audit.
D. Neither strengthening internal controls in an accounting information system nor an
operational audit.
Enforcing ___ tells a database to update a junction table whenever separate tables are
updated.
A. Internal control
B. Referential integrity
C. The accounting cycle
D. Expectancy theory
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
Most organizations use purchase orders to authorize inventory and other purchases. If a
company’s purchase order contains a column labeled “product code,” it most likely uses
what kind of coding?
A. Sequential
B. Block
C. Hierarchical
D. Mnemonic
As specified by the Audit Clarity Project, which element of the auditor’s report must
include the phrase “independent auditor’s report?”
A. introductory paragraph
B. auditor’s opinion
C. title
D. some other section
Consider the following flowchart symbols as necessary as you respond to the remaining
questions in this chapter:
According to ANSI, flowchart symbols can be divided into four main groups. Which of
the following symbols belong to different groups?
A. Symbols C and D
B. Symbols C and E
C. Symbols A and I
D. Symbols G and I
Data symbols: A and H. Process symbols: B, F, G, I, and J. Special symbols: C, D and
E. The fourth group is the line symbol, which is not depicted.
Big Data can arise from two broad types of sources. Which of the following best pairs
one type with an example?
A. accounting, trial balance
B. marketing, customer preferences
C. digital, query results from a relational database
D. All of these
The two sources are “traditional” and “digital.”
Which of the following schools of ethical thought teaches that people are fundamentally
solitary creatures, each pursuing their own best interest?
A. ethical egoism
B. utilitarianism
C. deontology
D. virtue ethics
Which element of Steps for Better Thinking is described in each independent item
below? Use each element of the model exactly twice.
a. Classifying previously identified costs and benefits as financial or nonfinancial
b. Conducting internal audits to assess the effectiveness of implemented internal
controls
c. Organizing focus groups to discuss ways to improve internal controls after
implementing several controls
d. Preparing a list of previously identified costs and benefits for specific internal
controls
e. Ranking a list of five internal control objectives according to their importance
f. Reading an article about the purposes of internal control
g. Recognizing a weakness in internal control
h. Recommending specific internal controls to implement
i. Taking a course to learn about the COSO internal control framework
j. Wondering if a CEO supports changes in internal control
Which type of coding system helps people remember the meaning of the code?
A. Sequential
B. Block
C. Hierarchical
D. Mnemonic
When organizations use XBRL, they can free themselves from:
A. Proprietary systems.
B. The steps in the accounting cycle.
C. Both proprietary systems and the steps in the accounting cycle.
D. Neither proprietary systems nor the steps in the accounting cycle.
Storage is one generic element of the AIS; the text explains that data stored
electronically often are grouped into three types of files. Which of the following
includes one example of each file type?
A. Purchases, sales, inventory
B. Purchases, inventory, purchases/inventory
C. Cash receipts, cash payments, cash on hand
D. Sales, cost of goods sold, inventory
Pablo had been asked by his supervisor to create a document explaining the process of
paying an invoice. If he wants to create a diagram that focuses on data, he could create:
A. A systems flowchart
B. A data flow diagram
C. Either a systems flowchart or a data flow diagram
D. Some other representation of the system
Which of the following statements best explains the relationship between the
acquisition/payment process and the sales/collection process?
A. The same transaction can be considered part of both processes.
B. All organizations that have a sales/collection process also have an inventory
acquisition/payment process.
C. Both the same transaction can be considered part of both processes and all
organizations that have a sales/collection process also have an inventory
acquisition/payment process.
D. Neither the same transaction can be considered part of both processes nor all
organizations that have a sales/collection process also have an inventory
acquisition/payment process.
Which of the following steps in the sales/collection process occurs last?
A. Bill the customer.
B. Approve the customer’s credit.
C. Ship the product.
D. Fill the order based on shipping instructions.