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Cengage Mindtap AIS Chapter 16 Quiz

Q1. Performance reports:

• Compare actual performance with budgeted expectations
• Are part of a managerial reporting system known as a responsibility accounting/reporting system
• All of these choices are correct
• Are tied to the hierarchy reflected by the firm’s organization chart

Q2. Hierarchical coding system is a good fit for the GL system for all of the following reasons, except:

• Takes into account which accounts and categories should be aggregated
• Can raise the issue of comparability
• Creates the order in which the accounts should appear
• Decides on which financial statements, if any, must an account appear

Q3. Which of the following fundamental responsibilities is not correct?

• The controller notifies the business reporting department of various adjusting entries
• Detailed reporting of daily production is sent to the president
• The treasurer notifies the business reporting department of investing and financing transaction activities
• Adjusted trial balance figures are sent from the business reporting department to the financial reporting officer

Q4. Logical processes in the GL/BR process include:

• All of these choices are correct
• Prepare business reports
• Validate business event updates
• Post event data

Q5. ERP systems facilitate balanced scorecard and business intelligence by:

• Expanding business reporting far beyond the basic financial statements and move the job of the accountant from business reporting to business analysis
• All of these choices are correct
• Aggregating varied data in a data warehouse that can then be analyzed using business intelligence tools
• Enabling data analytics, data mining, benchmarking, visualization, and reporting with drill-down capabilities

Q6. ERP financial modules:

• Include other reports such as budgeting, and a variety of financial reports
• All of these choices are correct
• None of these choices
• Include links to information that is related to other business processes

Q7. When financial reporting fraud is committed, what is generally the target of the “help”?

• The accountants
• The perpetrator(s)
• The shareholders
• The organization

Q8. Which if the following is not a reason that traditional accounting software is dying out in favor of the ERP system?

• If the account number is not changed in historical details, comparative information from prior periods will not be synchronized
• The information combined into a specific “account number” can be changed simply through adding fields to the database
• Users may need to develop an external to allow comparison of current revenue accounts to the corresponding accounts from the periods prior to the account number change
• In well-controlled systems, changes to historical details are not allowed

Q9. Primary functions of the GL/BR process include:

• Driving the financial reporting, BR, and other reporting by providing the information needed to prepare external and internal reports
• Preparing general purpose, external financial statements
• Accumulating data, classifying data by GL accounts, and recording data in those accounts
• All of these choices are correct

Q10. BR is important to:

• Investors and lenders as they allocate their capital between various organizations
• All of these choices are correct
• Managers as they guide their organization into various operating strategies
• None of these choices are correct