1. What is a system?
    Two or more components interacting to achieve a goal.
  2. What is goal conflict?
    Components of a system act in their own interest, disregarding the overall goal.
  3. What is goal congruence?
    Components of a system contribute to the common goal.
  4. What is data?
    Facts, recorded and stored.
  5. What is information?
    Processed data.
  6. What is used for decision making, data or information?
  7. What is information overload?
    Too much information - makes it harder to decide.
  8. What makes information useful?
    The information has to be:

    • - relevant
    • - reliable (free from error or bias)
    • - complete (not omit important aspects)
    • - timely
    • - understandable (presented in a useful and intelligible format)
    • - verifiable (2 independent, knowledgable sources agree)
    • - accessible (timely & understandable [available to user when needed and in usable format])
  9. What is the value of information?
    Benefit produced by info, minus cost producing it.
  10. Give 3 examples of benefits of information.
    - reduced uncertainty

    - improved decisions

    - improved ability to plan and schedule activities.
  11. What is a business process?
    Set of related, coordinated, structured activities that help achieve an organizational goal.
  12. What are the 5 major business processes/transaction cycles?
    revenue cycle

    expenditure cycle

    production/conversion cycle

    HR/payroll cycle

    financing cycle
  13. What is the revenue cycle?
    Goods/services are sold for (future) cash.
  14. What is the expenditure cycle?
    Aquisition of resources to perform services or produce goods for (future) cash.
  15. What is the production/conversion cycle?
    Materials are transformed into finished goods.
  16. What is the HR/payroll cycle?
    Employees are hired, trained, compensated, evaluated, promoted, and terminated.
  17. What is the financing cycle?
    Receive money from investors (incl. banks)

    Pay investors (incl. banks).
  18. What do accounting information systems do?
    • - Collect
    • - Process
    • - Store
    • - Report

    Data and Information.
  19. Accounting is seen as the _______ of business.
    Accounting is seen as the language of business.
  20. What are the 6 components of an AIS?
    - people who use the system

    - procedures and instructions used to collect, process, and store data

    - data about the organization

    - software used to process data

    - information technology infrastructure, incl. com,puters, peripheral devices, and network communication devices used in the AIS

    - internal controls and security measures that safeguard AIS data.
  21. Accounting Information Systems are considered the ________ - ________  _________ .
    Accounting Information Systems are considered the information-providing  vehicle.
  22. What are the 3 business functions AIS fulfill?
    1. Collect and store data

    2. Transform data into information

    3. Provide controls to safeguard data.
  23. How can an AIS add value to an organization?
    • - Improve quality and reduce cost of products/services
    • monitor machinery and notify of malfunctions => maintain product quality, reduce waste, lowers cost

    • - Improve efficiency
    • timely information improves just-in-time manufacturing

    • - Sharing knowledge
    • users can search database and find assistance

    • - Improve supply chain
    • sales and marketing cost reduction by direct access to AIS for customers

    • - Improve internal control structure
    • can protect system from fraud, errors, failures, and disaster

    • - Improve decision making
    • more acurate data, identification of critical situations, etc.
  24. What is a value chain?
    Activities that provide value to customers.
  25. What are the 5 primary activities of a value chain?
    1. Inbound logistics

    2. Operations

    3. Outbound logistics

    4. Marketing/Sales

    5. Service.
  26. What is inbound logistics (in the value chain)?
    Receiving, storing, distributing materials to produce products/services.
  27. What are operations (in the value chain)?
    Activities transforming inputs into outputs (products/services).
  28. What are outbound logistics (in the value chain)?
    Distributing products/services to customers.
  29. What are marketing and sales (in the value chain)?
    Activities that help customers buy products/services.
  30. What is service (in the value chain)?
    Post-sale support to customers.
  31. What are the 4 support activities to the value chain?
    1. Firm infrastructure

    2. HR

    3. Technology

    4. Purchasing.
  32. What is the firm infrastructure (as support activity to the value chain)?
    Admin activities that allow the organization to function.
  33. What is HR (as support activity to the value chain)?
    Employee management (recruiting, hiring, training, etc).
  34. What is technology (as support activity to the value chain)?
    Activities that improve the product/service (R&D, IT, product design).
  35. What is purchasing (as support activity to the value chain)?
    Procurement of raw materials/supplies needed to create product/service.
Card Set
Accounting Information Systems, ch 1