1. Data differ from information in which way? b.

transforming data into useful information

a. Data are output, and information is input. c. allocating organizational resources
b. Information is output, and data are input. d. automating all decision making
c. Data are meaningful bits of information.
d. There is no difference. 9. A firm, its suppliers, and its customers collectively
form which of the following?
2. Which of the following is NOT a characteristic a. supply chain
that makes information useful? b. value chain
a. It is reliable. c. ERP system
b. It is timely. d. AIS
c. It is inexpensive.
d. It is relevant. 10. A report telling how well all approved vendors
have performed in the prior 12 months is information
3. Which of the following is a primary activity in the that is MOST needed in which business process?
value chain? a. paying vendors
a. purchasing b. acquiring inventory
b. accounting c. selling merchandise
c. post-sales service d. paying employees
d. human resource management
1. Which of the following is NOT a step in the data
4. Which transaction cycle includes interactions processing cycle?
between an organization and its suppliers? a. data collection
a. revenue cycle b. data input
b. expenditure cycle c. data storage
c. human resources/payroll cycle d. data processing
d. general ledger and reporting system 2. All of the information (name, GPA, major, etc.)
about a particular student is stored in the
5. Which of the following is NOT a means by which same ______.
information improves decision making? a. file
a. increases information overload b. record
b. reduces uncertainty c. attribute
c. provides feedback about the effectiveness of prior d. field
decisions
d. identifies situations requiring management action 3. Which of the following would contain the total
value of all inventory owned by an organization?
6. In the value chain concept, upgrading IT is a. source document
considered what kind of activity? b. general ledger
a. primary activity c. cash budget
b. support activity
c. service activity 4. Which of the following is most likely to be a
d. structured activity general ledger control account?
a. accounts receivable
7. In which cycle does a company ship goods to b. petty cash
customers? c. prepaid rent
a. production cycle d. retained earnings
b. financing cycle
c. revenue cycle 5. Which of the following documents is most likely
d. expenditure cycle to be used in the expenditure cycle?
a. sales orders
8. Which of the following is a function of an AIS? b. credit memo
a. reducing the need to identify a strategy and c. receiving report
strategic position d. job time ticket

6. Which of the following is LEAST likely to be a
specialized journal?
a. sales journal
b. cash receipts journal
c. prepaid insurance journal
d. cash disbursements journal
7. How does the chart of accounts list general ledger
accounts?
a. alphabetical order
b. chronological order
c. size order
d. the order in which they appear in financial
statements
8. Which of the following is NOT an advantage of an
ERP system?
a. better access control
b. standardization of procedures and reports
c. improved monitoring capabilities
d. simplicity and reduced costs
9. Records of company data sent to an external party
and then returned to the system as input are called
______.
a. turnaround documents
b. source data automation documents
c. source documents
d. external input documents
10. Recording and processing information about a
transaction at the time it takes place is referred to as
which of the following?
a. batch processing
b. online, real-time processing
c. captured transaction processing
d. chart of accounts processing
1. A DFD is a representation of which of the
following?
a. the logical operations performed by a computer
program
b. flow of data in an organization
c. decision rules in a computer program
d. computer hardware configuration
2. Documentation methods such as DFDs, BPDs, and
flowcharts save both time and money, adding value
to an organization.
a. True b. False
3. Which of the following statements is FALSE?
a. Flowcharts make use of many symbols.
b. A document flowchart emphasizes the flow of
documents or records containing data.
c. DFDs help convey the timing of events.
d. Both a and b are false.
4. A DFD consists of the following four basic
elements: data sources and destinations, data flows,
transformation processes, and data stores. Each is
represented on a DFD by a different symbol.
a. True b. False
5. All of the following are guidelines that should be
followed in naming DFD data elements EXCEPT:
a. Process names should include action verbs such as
update, edit, prepare, and record.
b. Make sure the names describe all the data or the
entire process.
c. Name only the most important DFD elements.
d. Choose active and descriptive names.
6. The documentation skills that accountants require
vary with their job function. However, they should at
least be able to do which of the following?
a. Read documentation to determine how the system
works.
b. Critique and correct documentation that others
prepare.
c. Prepare documentation for a newly developed
information system.
d. Teach others how to prepare documentation.
7. Which of the following statements is FALSE?
a. A flowchart is an analytical technique used to
describe some aspect of an information system in a
clear, concise, and logical manner.
b. Flowcharts use a standard set of symbols
to describe pictorially the flow of documents and data
through a system.
c. Flowcharts are easy to prepare and revise when the
designer utilizes a flowcharting software package.
d. A system flowchart is a narrative representation
of an information system.
8. Which of the following flowcharts illustrates the
flow of data among areas of responsibility in an
organization?
a. program flowchart
b. computer configuration chart
c. system flowchart
d. document flowchart
9. All of the following are recommended guidelines a. DML
for making flowcharts more readable, clear, concise, b. DSL
consistent, and understandable EXCEPT: c. DDL
a. Divide a document flowchart into columns with d. DQL
labels.
b. Flowchart all data flows, especially exception 6. Which of the following attributes would most
procedures and error routines. likely be a primary key?
c. Design the flowchart so that flow proceeds from a. supplier name
top to bottom and from left to right. b. supplier number
d. Show the final disposition of all documents to c. supplier Zip code
prevent loose ends that leave the reader dangling. d. supplier account balance

10. How are data sources and destinations 7. Which of the following is a software program that
represented in a data flow diagram? runs a database system?
a. as a square a. DQL
b. as a curved arrow b. DBMS
c. as a circle c. DML
d. as two parallel lines d. DDL
e. none of the above
8. The constraint that all primary keys must have
nonnull data values is referred to as which
1. The relational data model portrays data as being of the following?
stored in __________. a. referential integrity rule
a. hierarchies b. entity integrity rule
b. tables c. normalization rule
c. objects d. relational data model rule
d. files
9. The constraint that all foreign keys must have
2. How a user conceptually organizes and either null values or the value of a primary key in
understands data is referred to as the __________. another table is referred to as which of the following?
a. physical view a. referential integrity rule
b. logical view b. entity integrity rule
c. data model view c. foreign key value rule
d. data organization view d. null value rule

3. What is each row in a relational database table 10. Which of the following attributes in the Cash
called? Receipts table (representing payments received from
a. relation customers) would most likely be a foreign key?
b. attribute a. cash receipt number
c. anomaly b. customer check number
d. tuple c. customer number
d. cash receipt date
4. Which of the following is an individual users
view of the database? 1. Which of the following is a fraud in which later
a. conceptual-level schema payments on account are used to pay off
b. external-level schema earlier payments that were stolen?
c. internal-level schema a. lapping
d. logical-level schema b. kiting
c. Ponzi scheme
5. Which of the following would managers most d. salami technique
likely use to retrieve information about
sales during the month of October?
2. Which type of fraud is associated with 50% of all
auditor lawsuits?
a. kiting
b. fraudulent financial reporting
c. Ponzi schemes
d. lapping
3. Which of the following statements is false?
a. The psychological profiles of white-collar
criminals differ from those of violent criminals.
b. The psychological profiles of white-collar
criminals are significantly different from those of the
general public.
c. There is little difference between computer fraud
perpetrators and other types of white-collar criminals.
d. Some computer fraud perpetrators do not view
themselves as criminals.
4. Which of the following conditions is/are usually
necessary for a fraud to occur? (Select all correct
answers.)
a. pressure
b. opportunity
c. explanation
d. rationalization
5. Which of the following is not an example of
computer fraud?
a. theft of money by altering computer records
b. obtaining information illegally using a computer
c. failure to perform preventive maintenance on a
computer
d. unauthorized modification of a software program
6. Which of the following causes the majority of
computer security problems?
a. human errors
b. software errors
c. natural disasters
d. power outages
7. Which of the following is not one of the
responsibilities of auditors in detecting fraud
according to SAS No. 99?
a. evaluating the results of their audit tests
b. incorporating a technology focus
c. discussing the risks of material fraudulent
misstatements
d. catching the perpetrators in the act of committing
the fraud
8. Which of the following control procedures is most
likely to deter lapping?
a. encryption
b. continual update of the access control matrix
c. background check on employees
d. periodic rotation of duties
9. Which of the following is the most important,
basic, and effective control to deter fraud?
a. enforced vacations
b. logical access control
c. segregation of duties
d. virus protection controls
10. Once fraud has occurred, which of the following
will reduce fraud losses? (Select all correct answers.)
a. insurance
b. regular backup of data and programs
c. contingency plan
d. segregation of duties
1. A set of instructions to increase a programmers
pay rate by 10% is hidden inside an authorized
program. It changes and updates the payroll file.
What is this computer fraud technique called?
a. virus
b. worm
c. trap door
d. Trojan horse
2. Which computer fraud technique involves a set of
instructions hidden inside a calendar utility that
copies itself each time the utility is enabled until
memory is filled and the system crashes?
a. logic bomb
b. trap door
c. virus
d. Trojan horse
3. Interest calculations are truncated at two decimal
places, and the excess decimals are put into an
account the perpetrator controls. What is this fraud
called?
a. typosquatting
b. URL hijacking
c. chipping
d. round-down fraud
4. A perpetrator attacks phone systems to obtain free
phone line access or uses telephone lines to transmit
viruses and to access, steal, and destroy data. What is
this computer fraud technique called?
a. phishing b. phishing
b. phreaking c. pharming
c. pharming d. phreaking
d. vishing

5. Fraud perpetrators threaten to harm a company if it 1. Which activity is part of the sales order entry
does not pay a specified amount of money. What is process?
a. setting customer credit limits
this computer fraud technique called?
b. preparing a bill of lading
a. cyber-terrorism c. checking customer credit
b. blackmailing d. approving sales returns
c. cyber-extortion
d. scareware 2. Which document often accompanies merchandise
shipped to a customer?
6. Techniques used to obtain confidential a. picking ticket
b. packing slip
information, often by tricking people, are referred to
c. credit memo
as what? d. sales order
a. pretexting
b. posing 3. Which method is most likely used when a
c. social engineering company offers customers discounts for prompt
d. identity theft payment?
a. open-invoice method
b. balance-forward method
7. What type of software secretly collects personal
c. accounts receivable aging method
information about users and sends it to someone else d. cycle billing method
without the users permission?
a. rootkit 4. Which of the following techniques is the most
b. torpedo software efficient way to process customer payments and
c. spyware update accounts receivable?
a. EFT
d. malware
b. UPIC
c. FEDI
8. What type of software conceals processes, files, d. ACH
network connections, memory addresses, systems
utility programs, and system data from the operating 5. Which of the following revenue cycle activities
system and other programs? can potentially be eliminated by technology?
a. rootkit a. sales order entry
b. shipping
b. spyware
c. billing
c. malware d. cash collections
d. adware
6. The integrated database underlying an ERP system
9. Which type of computer attack takes place results in which of the following general
between the time a software vulnerability is threats to the revenue cycle?
discovered and the time software developers release a a. inaccurate or invalid master data
b. unauthorized disclosure of sensitive information
software patch that fixes the problem?
c. loss or destruction of data
a. posing d. all of the above
b. zero-day attack
c. evil twin 7. Which document is used to authorize the release of
d. software piracy merchandise from inventory control (warehouse) to
shipping?
a. picking ticket
10. Someone redirects a websites traffic to a bogus
b. packing slip
website, usually to gain access to personal and c. shipping order
confidential information. What is this computer fraud d. sales invoice
technique called?
a. vishing
8. Which of the following provides a means both to d. A voucher package usually includes a debit memo.
improve the efficiency of processing customer
payments and also to enhance control over those 4. Which document is used to establish a contract for
payments? the purchase of goods or services from a supplier?
a. CRM a. vendor invoice
b. lockboxes b. purchase requisition
c. aging accounts receivable c. purchase order
d. EDI d. disbursement voucher

9. For good internal control, who should approve 5. Which method would provide the greatest
credit memos? efficiency improvements for the purchase of non
a. credit manager inventory items such as miscellaneous office
b. sales manager supplies?
c. billing manager a. bar-coding
d. controller b. EDI
c. procurement cards
10. For good internal control over customer d. EFT
remittances, the mailroom clerk should separate
the checks from the remittance advices and send the 6. Which of the following expenditure cycle activities
customer payments to which can be eliminated through the use of IT or
department? reengineering?
a. billing a. ordering goods
b. accounts receivable b. approving vendor invoices
c. cashier c. receiving goods
d. sales d. cash disbursements

7. What is the best control procedure to prevent

For good internal control over customer remittances, paying the same invoice twice?
the mailroom clerk should separate the checks from a. Segregate check-preparation and check-signing
the remittance advices and send the customer functions.
payments to which department? b. Prepare checks only for invoices that have been
a. billing matched to receiving reports and purchase orders.
b. accounts receivable c. Require two signatures on all checks above a
certain limit.
c. cashier
d. Cancel all supporting documents when the check is
d. sales signed.

1. Which of the following inventory control methods
is most likely to be used for a product for which sales
can be reliably forecast?
a. JIT b. EOQ
c. MRP d. ABC
2. Which of the following matches is performed in
evaluated receipt settlement (ERS)?
a. the vendor invoice with the receiving report
b. the purchase order with the receiving report
c. the vendor invoice with the purchase order
d. the vendor invoice, the receiving report,
and the purchase order
3. Which of the following is true?
a. It is easier to verify the accuracy of invoices for
purchases of services than invoices for purchases of
raw materials.
b. Setting up petty cash as an imprest fund violates
segregation of duties.
c. The EOQ formula is used to identify when to
reorder inventory.
8. For good internal control, who should sign checks?
a. cashier b. accounts payable
c. purchasing agent d. controller
9. Which of the following procedures is designed to
prevent the purchasing agent from receiving
kickbacks?
a. maintaining a list of approved suppliers and
requiring all purchases to be made from
suppliers on that list
b. requiring purchasing agents to disclose any
financial investments in potential suppliers
c. requiring approval of all purchase orders
d. prenumbering and periodically accounting for all
purchase orders
10. Which document is used to record adjustments to
accounts payable based on the return of
unacceptable inventory to the supplier?
a. receiving report b. credit memo
c. debit memo d. purchase order