Question 1

An organization can implement which of the following controls to reduce the threat of inventory theft or damage?

Accepted Answer

A)  review and approval of fixed asset acquisitions 
B)  improved and more timely reporting 
C)  better production and planning systems 
D)  document all movement of inventory through the production process 
A)  review and approval of fixed asset acquisitions 
B)  improved and more timely reporting 
C)  better production and planning systems 
D)  document all movement of inventory through the production process

Question 2

Implementing a modern costing approach often results in short-term declines in profitability.

Accepted Answer

A) True 
 B)False

Question 3

What is the primary drawback to using a volume-driven base,such as direct labor or machine hours,to apply overhead to products in a traditional cost accounting system?

Accepted Answer

A)  The cost accountant may not fully understand how to track direct labor or machine hours. 
B)  It is difficult for an AIS to incorporate such a measurement into its system. 
C)  It is difficult for an ERP to incorporate such a measurement into its integrated system. 
D)  Many overhead costs are incorrectly allocated to products since they do not vary with production volume. 
A)  The cost accountant may not fully understand how to track direct labor or machine hours. 
B)  It is difficult for an AIS to incorporate such a measurement into its system. 
C)  It is difficult for an ERP to incorporate such a measurement into its integrated system. 
D)  Many overhead costs are incorrectly allocated to products since they do not vary with production volume.

Question 4

What specific control can help restrict the rights of authorized users to only the portion of a database needed to complete their specific job duties?

Accepted Answer

A)  an access control matrix 
B)  passwords and user IDs 
C)  closed-loop verification 
D)  specific authorization 
A)  an access control matrix 
B)  passwords and user IDs 
C)  closed-loop verification 
D)  specific authorization

Question 5

What does the first term in the throughput formula,productive capacity,represent?

Accepted Answer

A)  the maximum number of units that can be produced given current technology 
B)  the percentage of total production time used to manufacture a product 
C)  the percentage of "good" units produced given current technology 
D)  the percentage of "bad" units produced given current technology 
A)  the maximum number of units that can be produced given current technology 
B)  the percentage of total production time used to manufacture a product 
C)  the percentage of "good" units produced given current technology 
D)  the percentage of "bad" units produced given current technology

Question 6

For replacement of inventories and assets destroyed by fire or other disasters,an organization needs

Accepted Answer

A)  stand-by facilities. 
B)  adequate insurance coverage. 
C)  source data automation. 
D)  All of the above are correct. 
A)  stand-by facilities. 
B)  adequate insurance coverage. 
C)  source data automation. 
D)  All of the above are correct.

Question 7

________ is an efficient way to track and process information about raw materials used in production.

Accepted Answer

A)  A just-in-time inventory system 
B)  Identifying materials with bar codes or RFID tags 
C)  A materials resources planning inventory system 
D)  Job-order costing 
A)  A just-in-time inventory system 
B)  Identifying materials with bar codes or RFID tags 
C)  A materials resources planning inventory system 
D)  Job-order costing

Question 8

"Push manufacturing" is also known as

Accepted Answer

A)  manufacturing resource planning (MRP). 
B)  just-in-time manufacturing system (JIT). 
C)  the economic order quantity (EOQ) system. 
D)  ahead-of-time production implementation (ATPI). 
A)  manufacturing resource planning (MRP). 
B)  just-in-time manufacturing system (JIT). 
C)  the economic order quantity (EOQ) system. 
D)  ahead-of-time production implementation (ATPI).

Question 9

________ costs are expenses associated with quality assurance activities.

Accepted Answer

A)  Prevention 
B)  Inspection 
C)  Internal failure 
D)  External failure 
A)  Prevention 
B)  Inspection 
C)  Internal failure 
D)  External failure

Question 10

Discuss two measures that can address the threats of inefficiencies and quality controls problems.

Accepted Answer

Throughput represents the number of good

Question 11

Discuss the criticisms of traditional cost accounting methods.

Accepted Answer

There can be an inappropriate allocation

Question 12

Manufacturing overhead is best described as

Accepted Answer

A)  costs that cannot be traced directly to specific jobs or processes. 
B)  costs that are economically feasible to trace directly to specific jobs or processes. 
C)  costs that are not economically feasible to trace directly to specific jobs or processes. 
D)  costs that management has decided not to trace directly to specific jobs or processes. 
A)  costs that cannot be traced directly to specific jobs or processes. 
B)  costs that are economically feasible to trace directly to specific jobs or processes. 
C)  costs that are not economically feasible to trace directly to specific jobs or processes. 
D)  costs that management has decided not to trace directly to specific jobs or processes.

Question 13

Which of the following organization controls should be implemented and maintained to counteract the general threat that the loss of production data will greatly slow or halt production activity?

Accepted Answer

A)  Store key master inventory and production order files on-site only to prevent their theft. 
B)  Back up data files only after a production run has been physically completed. 
C)  Access controls should apply to all terminals within the organization. 
D)  Allow access to inventory records from any terminal within the organization to provide efficient data entry. 
A)  Store key master inventory and production order files on-site only to prevent their theft. 
B)  Back up data files only after a production run has been physically completed. 
C)  Access controls should apply to all terminals within the organization. 
D)  Allow access to inventory records from any terminal within the organization to provide efficient data entry.

Question 14

How does an MRP inventory system reduces inventory levels?

Accepted Answer

A)  by reducing the uncertainty regarding when materials are needed 
B)  by receiving materials exactly when needed and in exact quantities 
C)  by computing the exact costs of purchasing and carrying inventory 
D)  none of the above 
A)  by reducing the uncertainty regarding when materials are needed 
B)  by receiving materials exactly when needed and in exact quantities 
C)  by computing the exact costs of purchasing and carrying inventory 
D)  none of the above

Question 15

________ are incurred to ensure that products are created without defects the first time.

Accepted Answer

A)  External failure costs 
B)  Inspection costs 
C)  Internal failure costs 
D)  Prevention costs 
A)  External failure costs 
B)  Inspection costs 
C)  Internal failure costs 
D)  Prevention costs

Question 16

Direct labor must be tracked and accounted for as part of the production process.Traditionally,direct labor was tracked using ________ but an AIS enhancement is to use ________ to record and track direct labor costs.

Accepted Answer

A)  job-time tickets; coded identification cards 
B)  move tickets; coded identification cards 
C)  employee earnings records; job-time tickets 
D)  time cards; electronic time entry terminals 
A)  job-time tickets; coded identification cards 
B)  move tickets; coded identification cards 
C)  employee earnings records; job-time tickets 
D)  time cards; electronic time entry terminals

Question 17

In an Activity-Based Costing (ABC)system,a cause-and-effect relationship is known as a

Accepted Answer

A)  cost stimulator. 
B)  overhead stimulator. 
C)  cost driver. 
D)  cost catalyst. 
A)  cost stimulator. 
B)  overhead stimulator. 
C)  cost driver. 
D)  cost catalyst.

Question 18

What is the main difference between MRP-II and JIT manufacturing systems?

Accepted Answer

A)  The length of the planning horizon 
B)  JIT uses long-term customer demand for planning purposes, but MRP-II uses short-term customer demand for planning purposes. 
C)  MRP-II relies on EDI, but JIT does not. 
D)  There are no significant differences between MRP-II and JIT. 
A)  The length of the planning horizon 
B)  JIT uses long-term customer demand for planning purposes, but MRP-II uses short-term customer demand for planning purposes. 
C)  MRP-II relies on EDI, but JIT does not. 
D)  There are no significant differences between MRP-II and JIT.

Question 19

The ________ is the production cycle document that specifies the quantity of each product to be produced and when production should begin.

Accepted Answer

A)  receiving report 
B)  bill of lading 
C)  master production schedule 
D)  operations list 
A)  receiving report 
B)  bill of lading 
C)  master production schedule 
D)  operations list

Question 20

Sule Technologies initiated a just-in-time inventory system in 2013.Now the production manager,Chan Ziaou,wants to apply the same principles to the entire production process.His recommendation is that Sule adopt a

Accepted Answer

A)  master production scheduling system. 
B)  lean manufacturing system. 
C)  manufacturing resource planning system. 
D)  computer-integrated manufacturing system. 
A)  master production scheduling system. 
B)  lean manufacturing system. 
C)  manufacturing resource planning system. 
D)  computer-integrated manufacturing system.

Exam 14: The Production Cycle

An organization can implement which of the following controls to reduce the threat of inventory theft or damage?

Implementing a modern costing approach often results in short-term declines in profitability.

What is the primary drawback to using a volume-driven base,such as direct labor or machine hours,to apply overhead to products in a traditional cost accounting system?

What specific control can help restrict the rights of authorized users to only the portion of a database needed to complete their specific job duties?

What does the first term in the throughput formula,productive capacity,represent?

For replacement of inventories and assets destroyed by fire or other disasters,an organization needs

________ is an efficient way to track and process information about raw materials used in production.

"Push manufacturing" is also known as

________ costs are expenses associated with quality assurance activities.

Discuss two measures that can address the threats of inefficiencies and quality controls problems.

Discuss the criticisms of traditional cost accounting methods.

Manufacturing overhead is best described as

Which of the following organization controls should be implemented and maintained to counteract the general threat that the loss of production data will greatly slow or halt production activity?

How does an MRP inventory system reduces inventory levels?

________ are incurred to ensure that products are created without defects the first time.

Direct labor must be tracked and accounted for as part of the production process.Traditionally,direct labor was tracked using ________ but an AIS enhancement is to use ________ to record and track direct labor costs.

In an Activity-Based Costing (ABC)system,a cause-and-effect relationship is known as a

What is the main difference between MRP-II and JIT manufacturing systems?

The ________ is the production cycle document that specifies the quantity of each product to be produced and when production should begin.

Sule Technologies initiated a just-in-time inventory system in 2013.Now the production manager,Chan Ziaou,wants to apply the same principles to the entire production process.His recommendation is that Sule adopt a

Accounting Information Systems: an Overview

Overview of Transaction Processing and Enterprise Resource Planning Systems

Systems Documentation Techniques

Relational Databases

Computer Fraud

Computer Fraud and Abuse Techniques

Control and Accounting Information Systems

Controls for Information Security

Confidentiality and Privacy Controls

Processing Integrity and Availability Controls

Auditing Computer-Based Information Systems

The Revenue Cycle: Sales to Cash Collections

The Expenditure Cycle: Purchasing to Cash Disbursements

The Human Resources Management and Payroll Cycle

General Ledger and Reporting System

Database Design Using the Rea Data Model

Implementing an Rea Model in a Relational Database

Special Topics in Rea Modeling

Introduction to Systems Development and Systems Analysis

Ais Development Strategies

Systems Design, implementation, and Operation

Filters

Direct labor must be tracked and accounted for as part of the production process.Traditionally,direct labor was tracked using but an AIS enhancement is to use to record and track direct labor costs.