AIS615 TEST 1 Solution 2018 individual assessment PDF

Preview

Summary

QUESTION 1a. Accounting Information System subsystems process financial transactions and non- financial transaction that directly affect the processing of financial transactions.Explain briefly any two (2) major subsystems in Accounting Information System.Textbook page : 8 - 9The major subsystems in...

Description

1

QUESTION 1 a. Accounting Information System subsystems process financial transactions and nonfinancial transaction that directly affect the processing of financial transactions. Explain briefly any two (2) major subsystems in Accounting Information System. Textbook page : 8 - 9 The major subsystems in Accounting Information System are : The transaction processing system (TPS)  It is the overall function of the information system.  Converts economic events into financial transactions  It deals with business events that occur frequently  It consists of three transaction cycles: revenue cycle, expenditure cycle and the conversion cycle. The general ledger/financial reporting system (GL/FRS)  Two closely related subsystem which is viewed as single subsystem.  Measures the status of financial resources and and changes in those resources and communicate this information to external users.  produces the financial statements and reports such as the income statement, balance sheet, statement of cash flows, tax returns and other report required by law. The management reporting system (MRS)  It provides the internal financial information needed to manage a business.  It produces special-purpose financial reports and information needed for decision making, such as budgets, variance report, and responsibility reports. Or other acceptable answers (Any 2 subsystems x 1 mark + 2 explanations each x 1½ marks = 5 marks b. State and briefly describe any three (3) functions of Information Technology (IT).

Text book page : 17 – 19 Functions of Information Technology : 



 

Data processing - brings to bear IT personnel, computer hardware, application programs (software) and corporate data to support user information needs through transaction processing and information reporting. Systems development & maintenance o Systems development is the process by which organizations acquire information systems. o System maintenance is responsible for making changes to existing systems to accomodatechanges in user needs. Database administration - is responsible for the security and integrity of the database. Network administration - is responsible for the effective functioning of the software

2

and hardware that constitute the organization’s network. (6 marks) c. General Model for AIS depicts the relationship the key elements that constitute an Accounting Information System application. Identify and briefly explain any four (4) elements in the General Model for Accounting Information System. Text book page : 9, Figure 1.4 THREE elements of the following :  End users  Data sources  Data collection  Data processing  Database management  Information generation  Feedback

QUESTION 2

(8 marks)

3

a. Three transaction cycles process most of the firm’s economic activities : the expenditure cycle, conversion cycle and revenue cycle. State and briefly explain any three (3) of the subsystems under the expenditure cycle. Text book page : 35 Susystems under the expenditure cycle :  

 

Purchasing/Account Payable – this system recognizes the need to acquire physical inventory such as raw material and places an order with the vendor. Cash Disbursements – authorizes the payment, disburses the funds to vendor and records the transaction by reducing the cash and accounts payable accounts. Payroll – collects labor usage data for each employee, computes the payroll and disburses paychecks to the employee. Fixed Assets – processes transaction pertaining to the acquisition, maintenance and disposal of its fixed assets. (6 marks)

b. Data redundancy causes three (3) types of data management problems. Explain briefly

these types of problem. Text book page : 46 The three (3) types of data management problems related to data redundancy are : a. Data storage √– To meet the private data needs of users, organizations must incur the costs of both multiple collections and multiple storage procedures.√ b. Data updating √– when users keep separate files, all changes must be made separately for each user. This adds significantly to the task and the cost of data management.√ c. Currency of information √– If update information is not properly disseminated, the change will not be reflected in some user’s data, resulting in decisions based on outdated information.√ (6 marks) c. Explain the difference between batch processing and real time processing. Text book page : 63 Different between batch processing and real processing : Batch processing Occur when similar transactions are accumulated into groups for processing.√ There are a time lag between the point at which an economic event occurs and the point at which it is processed.√ Real-time processing

4

Real-time processing captures each event or transaction and processes it before engaging in another transaction.√ There are no time lags exist between occurrence and processing.√ (4 marks) d. The following information describes part of the cash receipt procedures of Che Ummi Sdn Bhd which begin in the mail room of the company. Customer payments and remittance advices arrive at the mail room, where a clerk opens the envelopes, reconciles the cheques and remittance advices and endorses the cheques. The clerk later gathers the remittance advices and cheques into batches, and prepares three copies of remittance list. Then the clerk sends the cheques and a copy of the remittance list to the cashier in the cash receipts department. Prepare a system flowchart depicting the above cash receipt procedures.

Mail Room √

CUSTOMER

CHEQUE

√ √

REMITTANCE ADVICE

RECONCILE CHEQUE WITH RA AND ENDORSE

REMITTANCE ADVICE RECONCILED

√

5

ENDORSED CHEQUES

PREPARE REMITTANCE LIST

√

CHEQUE

REMITTANCE LIST 3 √

REMITTANCE LIST 2 REMITTANCE LIST 1

REMITTANCE ADVICE

√

CASH RECEIPT DEPT.

√

√ √

(5 marks) (Total: 40 marks)...