ACCT 341, Chapter 1, Questions
This assignment is assigned on the first day of class and is due no later than Wednesday at midnight. Please email
your answers (either Word file or PDF file) to acct341@wallawalla.edu.
To answer the following questions, refer to the instructor notes and your great powers of intuition.
1.
What is an accounting information system?
2.
Why is knowledge “always gained by the orderly loss of information”?
3.
As the language of business, Warren Buffet believes that every investor should be fluent in accounting. Do you
agree? Why or why not?
4.
What can happen to capital markets when accounting information systems produce bogus information?
5.
(A) Who was the father of the modern accounting system?
(B) What book did he publish and who illustrated his books?
(C) True or false: A double-entry accounting system is based on the principle of algebra (left side equals right).
(D) True or false: The accounting cycle has changed little in the last five hundred years.
6.
Suppose that the accounting information systems (AISs) of all government, business, and other organizations in
the U.S. ground to a halt.
(A) What problems would quickly develop? Give examples.
(B) How long would take for the whole country to come to a standstill? Weeks? Days? Hours?
7.
Refer to the instructor notes for this chapter.
(A) Describe the major shifts in economic activity (ages) in the U.S. since the Pilgrims landed on our shores.
(B) In what age do you think the following countries are today: China? India? Ethiopia? U.S.?
(C) In just three generations, my family moved from the agriculture age, through the industrial age, and into the
information age. State what each of the following did for a living (if you know): Your great-grandfather?
Your grandfather? Your father?
8.
(A) What is compumation? Give an example.
(B) What is one advantage and one disadvantage to compumation?
9.
(A) True or false: Today, at least 70% of the U.S. workforce consists of knowledge workers.
(B) How can you prevent becoming a victim of compumation?
(C) How would a sociologist describe the effects of the information age on how/where we work?
See your textbook for answers to the remaining questions:
10. T or F: Most end users need processed data, rather than raw data, for decision-making purposes.
11. According to Case-in-Point 1.1 in your text, how was the fraudster able to use inaccurate raw data to perpetuate
the fraud?
12. (A) How is an ERP system bigger than a traditional accounting system?
(B) Do you think WWU’s software system (myWWU, made by PeopleSoft/Oracle) is an ERP?
13. Distinguish how the main objectives of financial and managerial accounting are different.
14. Many accounting systems today capture non-financial data. Provide an example of how an accounting database
should also include non-financial data.
15. Regarding the quote below: (A) Which event has more impact on the company? (B) Which event is accounted
for on the books (e.g. which is an accounting event)?
“On the same day that a company hires a new president, a clerk purchases a package of paper clips on credit
for the president’s office. Accounting rules permit only one of these two events to be recorded.”
16. The following quote is from the father of modern management theory, the late, great Peter Drucker (Claremont
Graduate University). Do you agree with Drucker? Why or why not?
“People usually consider accounting to be financial. But that is valid only for the part, going back 700 years,
that deals with assets, liabilities, and cash flows; it is only a small part of modern accounting. Indeed,
accounting today deals with operations . . . money is simply a notation and the language in which to express
nonmonetary events”.
17. If you were a business executive, would you like your AIS to produce a dashboard for you? Why or why not?
18. Other than the CPA, list three certifications can obtain in connection to working with or auditing accounting
information systems.