ACC 564 Final Exam Review: Key Accounting Information Systems Concepts and Fraud Detection

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ACC 564 Final Exam Review: Key Accounting Information Systems Conceptsand Fraud DetectionACC 564 FINAL EXAM PART 1 TWO VERSIONS POSTED 100 QUESTIONSQuestion 1The transaction cycle that includes the events of hiring employees and paying them isknown astheAnswerrevenue cycle.expenditure cycle.human resources cycle.financing cycle.Question 2Data must be converted into information to be considered useful and meaningful for decision-making. There are six characteristics that make information both useful and meaningful. Ifinformation is free from error or bias and accurately represents the events or activities of theorganization, it is representative of the characteristic ofAnswerrelevancy.timeliness.understandability.reliability.Question 3The primary objective of accounting is toAnswerimplement strong internal controls.provide useful information to decision makers.prepare financial statements.ensure the profitability of an organizationQuestion 4The business owners obtain financing from outside investors, which results in an inflow of cashinto the company. This transaction is considered to be part of which cycle?Answerthe revenue cyclethe payroll cyclethe production cyclethe financing cycleQuestion 5

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Information that is free from error or bias and accurately represents the events or activities of theorganization isAnswerrelevant.reliable.verifiable.timelyQuestion 6Hector Sanchez works in the accounting department of a multinational manufacturing company.His job includes updating accounts receivable based on sales orders and remittance advices. Hisresponsibilities are part of the company'sAnswerrevenue cycle.expenditure cycle.financing cycle.production cycleQuestion 7An audit trailAnswerprovides the means to check the accuracy and validity of ledger postings.begins with the general journal.is automatically created in every computer-based information system.is a summary of recorded transactionsQuestion 8What usually initiates data input into a system?AnswerThe transaction system automatically checks each hour to see if any new data is available forinput and processing.The performance of some business activity generally serves as the trigger for data input.A general ledgerprogram is queried to produce a trial balance at the end of an accounting period.Data is only input when a source document is submitted to the accounting departmentQuestion 9The general ledger account that corresponds to a subsidiary ledger account is known as aAnswerdependent account.attribute account.entity account.control account.Question 10The efficiency of recording numerous business transactions can be best improved by the use of

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Answerprenumbered source documents.specialized journals.posting references.subsidiary ledgersQuestion 11Chas Mulligan has been hired by Yardley Security as an assistant to the internal auditor. He hasbeen asked to document the existing accounting information system, and focus on the activitiesand flow of data between activities. He decides to begin with a summary description of thesources and uses of data in the organization and how they are processed by the system. Thedocumentation tool that heshould employ for this purpose is aAnswerdata flow diagram.document flowchart.system flowchart.program flowchart.Question 12In general, a data destination will be shown byAnsweran arrow pointing away.an arrow pointing in.arrows pointing both ways.no arrows, only two horizontal lines.Question 13A data flow diagramAnsweris a graphical description of the source and destination of data that shows how data flow withinan organization.is a graphical description of the flow of documents andinformation between departments orareas of responsibility.is a graphical description of the relationship among the input, processing, and output in aninformation system.is a graphical description of the sequence of logical operations that a computer performs as itexecutes a programQuestion 14A flowchart that depicts the relationships among the input, processing, and output of an AIS isAnsweran internal control flowchart.a document flowchart.a system flowchart.

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a program flowchart.Question 15Chuck and Jill Scruggs travel in their motor home six months of the year and buy uniqueartifacts. Within hours after the Scruggs make a purchase, they have photographed it, written adescription of it, and posted it for sale on eBay with a reservation price. Anything that does notsell within a week is shipped back to Austin, Texas, for display in The House of Curiosities, aretail business that the Scruggs operate during the balance of the year. Which symbol should beused to represent the transfer of data to eBay in a context diagram of this process?AnswerA) rectangleB) circleC) arrow up and rightD) parallel horizontal linesQuestion 16The ________ handles the link between the way data are physically stored and each user'slogical view of that data.Answerdata warehousedata dictionarydatabase management (DBMS) softwareschemaQuestion 17The logical structure of a database is described by theAnswerdata dictionary.schema.database management system.internal level.Question 18The database requirement that foreign keys must be null or have a value corresponding to thevalue of a primary key in another table is formally called theAnswerentity integrity rule.referential integrity rule.rule of keys.foreign key ruleQuestion 19A set of individual user views of the database is called theAnswerconceptual-level schema.internal-level schema.external-level schema.meta-schema.

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Question 20Inability to add new data to a database without violating the basic integrity of the database isreferred to as theAnswerupdate anomaly.insert anomaly.integrity anomaly.delete anomaly.Question 21The US Justice Department defines computer fraud asAnswerany crime in which a computer is used.an illegal act in which knowledge of computer technology is essential.any act in which cash is stolen using a computer.an illegal act in which a computer is an integral part of the crimeQuestion 22Which of the following is the greatest risk to information systems and causes the greatest dollarlosses?Answerhuman errors and omissionsphysical threats such as natural disastersdishonest employeesfraud and embezzlementQuestion 23The most efficient way to conceal asset misappropriation is toAnswerwrite-off a customer receivable as bad debt.alter monthly bank statements before reconciliation.alter monthly physical inventory counts to reconcile to perpetual inventory records.record phonypayments to vendors.Question 24Most fraud perpetrators are insiders becauseAnswerinsiders are more dishonest than outsiders.insiders know more about the system and its weaknesses than outsiders.outsiders are more likely to get caught than insiders.insiders have more need for money than outsidersQuestion 25The simplest and most common way to commit a computer fraud is toAnsweralter computer input.alter computer output.modify the processing.corrupt the databaseQuestion 26Telefarm Industries is a telemarketing firm that operates in the Midwest. The turnover rate

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among employees is quite high. Recently, the information technology manager discovered thatan unknown employee had used a Bluetooth-enabled mobile phone to access the firm's databaseand copy a list of customers from the past three years that included credit card information.Telefarm was a victim ofAnswerBluesnarfing.splogging.vishing.typosquatting.Question 27Illegally obtaining and using confidential information about a person for economic gain is knownasAnswereavesdropping.identity theft.packet sniffing.piggybacking.Question 28A fraud technique that slices off tiny amounts from many projects is called the ________technique.AnswerTrojan horseround downsalamitrap doorQuestion 29Computer fraud perpetrators that modify programs during systems development, allowing accessinto the system that bypasses normal system controls are usingAnswera Trojan horse.a trap door.the salami technique.superzapping.Question 30Which of the following is the easiest method for a computer criminal to steal output without everbeing on the premises?Answerdumpster divingby use of a Trojan horseusing a telescope to peer at paper reportselectronic eavesdropping on computer monitorsQuestion 31What is one reason why AIS threats are increasing?AnswerLANs and client/server systems are easier to control than centralized, mainframe systems.Many companies do not realize that data security is crucial to their survival.

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