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Package Title: Testbank Questions
Course Title: IS 5e
Chapter Number: 10
Question Type: True/False
1. The functional area information systems are the most fundamental information systems in the
organization.
2. The data processed by transaction processing systems provide the inputs for other organizational
information systems.
3. In general, organizations try to automate data entry as much as possible.
4. When you make a purchase online, that transaction is an example of batch processing.
5. Functional information systems support the entire enterprise or major portions of it.
6. The information systems for Accounting and Finance could contain control and auditing process.
7. The POM function within an organization monitors the customer sales activity.
8. An example of a transaction in a HRIS application is adding a new employee.
9. Information systems can be function-specific.
10. Historically, the functional area information systems were developed independently of one another.
11. Information silos were particularly efficient when business processes crossed functional boundaries
in an organization.
12. Business processes may be located within one functional area or may span multiple functional
areas.
13. Best practices are the most successful solutions or problem-solving methods for achieving a
business objective.
14. Enterprise resource management is an enterprise-wide effort to acquire and retain customers.
15. Financial management, operations management, and human resource management are extended
ERP modules.
16. When ERP systems are not appropriate in an organization, then that organization can use an
enterprise application integration system.
17. Organizations that use ERP systems are more agile and adaptive.
18. ERP systems cannot manage cross departmental processes.
19. Exception reports show a greater level of detail than is included in routine reports.
20. Key-indicator reports shows data at a greater level of detail.
21. Drill down reports are produced at scheduled intervals.
22. An organization has to own all of the information systems it used.
23. In addition to cost savings and in labor and time, the new IS added a level of reliability and quick
access to information that employees had not even realized they needed.
24. European railways improved its efficiencies by using SAP, which is a customer relationship
management system.
25. A company that implements an ERP system must reworking their business processes to meet the
procedures established by their ERP systems to gain significant benefits.
26. Which of the following is true?
A. Transactions are only critical to the area they occur in.
B. Transactions can only involve one database.
C. Transactions can only involve one computer.
D. The actual processing of a Transaction has to be standard.
E. Transactions generate a small volume of data.
27. Which of the following is false?
A. Corporate data is supplied by Transaction processing systems.
B. Information systems are only used by large organizations.
C. Reports from information systems are used in all levels of the organization.
D. Data from TPS systems feeds ERP systems.
E. Information systems within an organization support internal and external processes.
28. Organizational transactions are typically _____ volume, _____, and therefore _____ to
computerize.
A. low, repetitive, difficult
B. high, repetitive, easy
C. high, different, difficult
D. low, different, easy
E. high, different, easy
29. Business transactions that are processed as they occur is an example of
A. batch processing
B. source data automation
C. OLTP
D. TPS
E. ESS.
30. The most fundamental information systems in an organization are:
A. office automation systems
B. decision support systems
C. functional area information systems
D. Transaction processing systems
E. business intelligence systems
31. When interest is credited to your savings account at your bank, it is called a:
A. process
B. function
C. calculation
D. Transaction
E. decision
32. Crediting interest to your savings account at your bank once a month, it is called a:
A. process
B. function
C. calculation
D. Transaction
E. decision
33. When interest is credited to your savings account at your bank, it is called a:
A. process
B. function
C. calculation
D. Transaction
E. decision
34. Data that have been processed by the organization’s _____ are inputs into the organization’s
database.
A. office automation systems
B. functional area information systems
C. Transaction processing systems
D. decision support systems
E. digital dashboards
35. Which of the following is not a characteristic of a transaction processing system?
A. small amounts of data are processed
B. sources of data are mainly internal
C. low computation complexity
D. high level of accuracy, data integrity, and security
E. high level of detail
36. Which of the following is not an example of a transaction?
A. A person hired
B. A payroll check generated
C. A service sold
D. Printing a report
E. Checking out at Walmart
37. Which of the following is false?
A. TPS need large computers to process the transactions.
B. Business transactions can be processed when they occur.
C. Business transactions can be processed after they occur.
D. Data for transactions can be collected by sensors.
E. A transaction is a business event.
38. Which of the following is not a function of functional area information systems?
A. providing information to managers in the functional areas
B. supporting the managerial tasks of planning, organizing, and controlling operations
C. providing information mainly in the form of reports
D. providing data from business events to the corporate database
E. providing analysis capabilities to middle level managers and staff
39. Which of the following is not a process within an information system for Accounting and Finance?
A. Budgeting
B. Managing Currencies
C. Inventory management
D. Auditing
E. Expense management
40. Which of the following is not a process within an information system for Human Resource
Management?
A. Benefits administration
B. Firing decisions
C. Peer evaluations
D. Recruitment
E. Training
41. Which of the following is false?
A. Inventory management determines how much inventory to order.
B. Large companies allow their vendors to manage their inventory.
C. The POM function within an organization monitors sales.
D. Quality control used by manufacturing units uses metrics.
E. Computer systems are used to integrate all aspects of product design.
42. Which of the following is false?
A. ERP systems are an evolution of functional information systems.
B. ERP systems look the same to users as functional information systems.
C. ERP systems have much the same functionality as functional information systems.
D. ERP systems produce the same reports as functional information systems.
E. ERP systems use the same data as functional information systems.
43. Enterprise resource planning systems take a(n) _____ view of the overall organization.
A. User’s
B. Management
C. Functional
D. Business process
E. Transactional
44. _____ integrate the planning, management, and use of all of an organization’s resources, and are
designed to tightly integrate the functional areas of the organization.
A. Transaction processing systems
B. Supply chain management systems
C. Functional area information systems
D. Enterprise resource planning systems
E. Corporate extranets
45. Which of the following is false?
A. Functional area information systems were usually developed independently.
B. Functional area information systems easily communicate with each other.
C. ERP systems are designed to integrate business processes.
D. ERP systems use a common database.
E. ERP systems integrate functional areas within an organization.
46. The characteristics of ERP systems include all of the following except:
A. integrating the planning, management, and use of all resources of the organization
B. providing information necessary to control the business processes of the organization
C. including a set of interdependent software modules
D. typically fitting an organization’s existing business processes
E. they are expensive and time-consuming
47. Enterprise resource planning systems are very _____ software products, meaning that companies
typically have to change their _____ to accommodate how the software functions.
A. unstructured, business processes
B. structured, reporting relationships
C. structured, accounting processes
D. unstructured, inventory control
E. structured, business processes
48. _____ are interorganizational ERP systems that provide Web-enabled links between an
organization’s key business systems and its customers, suppliers, business partners, and others.
A. Functional area information systems
B. Supply chain management systems
C. Transaction processing systems
D. Office automation systems
E. ERP II systems
49. _____ are the most successful solutions or problem-solving methods for achieving a business
objective.
A. Business functions
B. Best practices
C. Optimal strategies
D. Business processes
E. Enterprise solutions
50. The drawbacks of ERP systems include all of the following except:
A. They are complex
B. They are expensive
C. They are time-consuming to implement
D. Companies may need to change existing business processes to fit the software
E. They consist of modules
51. Which of the following was not included in early ERP systems?
A. Sales and Marketing
B. Inventory Control
C. Order Entry
D. Distribution
E. Raw materials management
52. Which of the following is false about ERP II systems?
A. They utilize the Web.
B. They include human resources processes.
C. Functionality is delivered as e-business suites.
D. They support internal- facing applications as well as external-facing applications.
E. These ERP systems have no optional modules.
53. Which of the following is false?
A. Breaking down functional silos makes an organization more adaptive.
B. An organization doesn’t have to use the business processes coded into the ERP.
C. ERP systems change an organization’s business processes.
D. ERP systems are time consuming to implement.
E. ERP systems require functional areas to work together.
54. Which of the following has not been identified as a reason for ERP implementation failure?
A. Failure to include affected employees in planning
B. The complexity of the planning
C. Lack of documentation
D. Insufficient training
E. No change management processes
55. The ______________ process originates in the warehouse and end in the accounting department.
A. procurement
B. fulfillment
C. production
D. None of the choices are correct
56. The ____________ process originates in the sales department and ends in the accounting
department.
A. procurement
B. fulfillment
C. production
D. None of the choices are correct
57. Which of the following activities does not occur within the order fulfillment process?
A. The sales department receives a customer inquiry and issues a quotation indicating price and
availability.
B. The sales department forwards a sales order to the warehouse.
C. The warehouse forwards a purchase requisition in order to buy goods from a vendor.
D. The warehouse prepares the shipment and produces internal documentation.
E. The accounting department issues an invoice to the customer.
58. _____ reports contain special information not found in routine reports.
A. Ad hoc
B. Summary
C. Drill-down
D. Key-indicator
E. Exception
59. _____ reports are produced at scheduled intervals.
A. Ad hoc
B. Routine
C. Exception
D. Detailed
E. Key indicator
60. _____ reports summarize the performance of critical activities.
A. Ad hoc
B. Routine
C. Exception
D. Detailed
E. Key indicator
61. When the chief financial officer of a company wants a report on business units who have spent 10
percent more than their allotted budget, she would be requesting which type of report?
A. Ad hoc
B. Routine
C. Exception
D. Detailed
E. Key indicator
62. _____ reports include only information that falls outside certain threshold standards.
A. Ad hoc
B. Routine
C. Exception
D. Detailed
E. Key indicator
63. To effectively manage by exception (i.e., use exception reports), the company must first create:
A. performance standards
B. best practices
C. user information requirements
D. a database
E. employee evaluation guides
64. Refer to Opening Case – IT Transformation at Ford Motor Company: Which of the following is true?
A. The best way to improve the efficiency of existing IT is to add new technology
B. Consolidation and redundancy elimination is an important aspect of improving IT infrastructure
C. To increase productivity of the IT systems, new employees with experience should be brought in as
replacements
D. The most efficient use of recourses is to develop all applications in house.
65. Refer to Closing Case – In order to meet its goals with fewer resources in a difficult economy,
PACCAR
A. Outsourced the development of the new system
B. Hired talented IT employees while laying off other workers
C. Trained their employees in new skills
D. Bought existing software to suit their needs
E. Used open source software since it was free
Question Type: Essay
66. Differentiate between transaction processing systems and functional area information systems.
67. Differentiate between batch processing and online transaction processing.
68. Explain how information systems for accounting and finance support an organization.
69. Explain how information systems for production operations management support an organization.
70. Explain how information systems for human resource management support an organization.
71. Explain how information systems for marketing and sales support an organization.
72. Define enterprise resource planning systems and discuss why they were developed.
73. Describe the various reports that can be obtained from functional area information systems.
74. Contrast routine reports and drill-down reports.
75. Define source data automation and describe why this process is so important to transaction
processing systems.
76. Discuss why functional area information systems would have been built as silos. Explain the
limitations of that approach.
77. Discuss the reasons why ERP systems evolved and what organizations hope to gain by
implementing them.
78. Differentiate between ERP systems and ERP II systems.
79. What are ad-hoc (on-demand) reports? Why does an organization need to be able to run ad-hoc
reports?
Question Type: True/False
80. Greg is mowing lawns in the neighborhood for the summer. He does not need an information
system.
Question Type: Multiple Choice
81. Greg is mowing lawns in the neighborhood for the summer. Which of the following is not an
example of a transaction he has in his business?
A. Adding a new client to his list.
B. Mowing a client’s lawn
C. Buying gas for his mower
D. Driving to the client’s house
E. Getting paid by the client
82. Greg is mowing lawns in the neighborhood for the summer. Which type of report would he used to
see which of his clients still owe him money?
A. Ad hoc
B. Summary
C. Exception
D. Detailed
E. Key indicator
83. Greg is mowing lawns in the neighborhood for the summer. Which type of report would he used to
see which if a particular client still owe him money?
A. Ad hoc
B. Routine
C. Exception
D. Detailed
E. Key indicator
Question Type: Essay
84. Greg is mowing lawns in the neighborhood for the summer. How could he use source data
automation to make data entry easier?
85. Kathy has taken a job with her ideal company and is excited to start in their sales department.
During orientation, she is told that the company is very proud of their ERP system from SAP. Looking at
the list of modules the company has, Kathy wonders which one she won’t be using. From the list below,
which one would you tell Kathy is the one she won’t be using.
A. Customer relationship management
B. Human resource management
C. Business intelligence
D. Operations management
E. E-Business
