A. Fill in one technical term for each of the following blanks.

a. ___________________________________________________ is used to record inventory items and it eliminates the need to align inventory items with scanner.

b.Top-level reviews belong to the control activity of ___________________________________________________, which is done by someone other than the person who performs the original operation.

c. Account receivable clerk assumes the __________________ function under the principle of segregation of duties.

d. One example of __________________________________, which is a control, is to compare the quantity of inventory ordered today to past order history of a customer.

e. ________________________usually accompanies a sales invoice in local shipment to show what are being shipped.

f. The executive or high level committee that oversees the information system function, and facilitates the coordination and integration of system activities. _______________

g. The method of _____________________________________ is to check accuracy of input data by retrieving related information.

h. _____________________________________ printed by sales order entry triggers the warehouse workers to pick and pack the goods for later shipment.

B.

1) Suppose Peter is evaluating different control procedures to combat the risk of unauthorized system access. The current system is only 85% reliable. Peter calculates the exposure at $200,000. Option I costs $5,000 and reduces the risk to 10%. Option II costs $10,000 and reduces the risk to 5%. Implementing both I and II will further reduce the risk to 2%. Which option should he take?

A) Option I B) Option II C) Option I and II together D) Take no action as all options result in negative net benefit E) None of the above

2) Which of the following is normally not included in an accounting information system such as MYOB (or ABSS)?

A) Revenue cycle

B) Expenditure cycle

C) Human resources / payroll cycle

D) Inventory

E) General Ledger and Reporting System

3) If you close your financial year in computerized accounting system, which of the following is (are) true?

1 The balance of your current-year earnings account is transferred to your retained earnings account.

2 The balances of your assets and liabilities accounts are returned to zero.

3 The balances of your income, cost of sales, expense, other income and other expense

accounts are returned to zero

A) I and III only

B) I,IIandIII

C) IIonly

D) II and III only

E) Noneoftheabove

4) The decision of whether to sell an in-stock item (i.e. the item is available) to a customer will depend on:

A) inventory availability B) backorder approval C) the dependability of the supplier D) the customers credit status E) noneoftheabove

5) If you choose to convert your manual accounting system into a computerized accounting system in the middle of your financial year, which of the following is (are) false?

I. You cannot convert in the middle of the financial year. II. You need to input all of the year-to-date balances of your profit & loss accounts.

III. Except the Retained Earning account, the opening balances of all of your balance sheet accounts are zero.

A) I, II and III B) I and III C) Only II D) II and III E) None of the above

5) Relating to assignment 2, i.e. the system implementation (MYOB) assignment, which of the following is(are) false?

1 You need to input the opening balances of profit & loss and balance sheet accounts in the setup.

2 You need to create the inventory items and input the quantity on hand.

3 You need to input the open balances of outstanding supplier invoices.

4 You need to input the open balances of outstanding sales invoices.

A) I, II and III

B) II and IV

C) IV only

D) II and III

E) I only