Exam 15: Financial Analysis Tools

With a no charge method, indirect IT department costs are ____.

A(n) ____________________ is a technique that uses accounting entries to allocate the indirect costs of running an IT department.

Cost-avoidance benefits refer to expenses that would be necessary if a new system is not installed.

____________________ is the charging of indirect IT department costs based on the resources used by an information system.

____________________ is the total time that a user is connected actively to a remote server - some Internet service providers use this as a basis for charges.

When determining economic feasibility, a systems analyst must consider a project's benefits compared to the project's ____________________, which includes ongoing support and maintenance costs, as well as acquisition costs.

____ means that the projected benefits of a proposed system outweigh the estimated costs.

Return on investment analysis considers costs and benefits over a shorter time span than payback analysis.

Indirect costs, or overhead expenses, cannot be attributed to the development of a particular information system.

Payback analysis often is used to compare or rank projects because later benefits are noticed.

The concept that a future monetary value is related to a specific value invested today is known as the time value of money, and it is the basis of a technique called ____________________.

Variable costs are costs that vary depending on the level of activity.

Unlike payback analysis, present value analysis considers just the earlier values, and not all the costs and benefits.

____________________ is the process of determining how long it takes an information system to pay for itself.

In a client/server system, ____________________ is the time that the server actually responds to client requests for processing.

Cost-benefit analysis is performed ____ to determine the economic feasibility of an information system project and to compare alternative solutions.

With a fixed charge method, the IT group is regarded as a(n) ____________________, which is a department that is expected to break even or show a profit.

The time it takes to recover an information system's costs is called the ____________________.

The period between the beginning of systems operation and the point when operational costs are rapidly increasing is called the ____________________ of the system.

Direct costs usually are more difficult to identify and predict than indirect costs.