Accounting Information System Chapter 1 Discussion Questions

1687 WordsSep 23, 20117 Pages
Discussion Questions 1. Discuss some of the challenges facing business today. Does information technology play a role in these challenges? Explain. The business world and society in general are undergoing phenomenal and sometimes turbulent change. The “new economy” driven by the Internet has seen the rise of entirely new businesses like Amazon.com, Yahoo, eBay, and of course Google. While the “dot com bust” of 2000 saw the demise of thousands of Internet-oriented businesses, the fact remains that most traditional “bricks and mortar” businesses have been forced to transform themselves into some form of an “e-business” simply to survive in this new era. The old cliché, that the only constant in business is change, is still true except that…show more content…
6. Describe the traditional view of accounting and the manual accounting process. the purpose of accounting is to provide information for economic decision making. Economic activity in an organization manifests itself in a variety of events traditionally referred to as transactions. For long, the role of accounting has been to record, classify, and report the results of these transactions. The traditional methodology for recording and classifying transactions is the double-entry system of bookkeeping devised by Luca Pacioli in 1494. 7. What are the problems associated with the traditional view of accounting? “transactions” orientation as opposed to an “events” orientation, narrow focus on financial data, reporting is periodic and not real-time, limited accessibility of information, too high a level of aggregation, and limited flexibility which prevents answering queries that cross functional boundaries. 8. Distinguish between “transactions orientation” and “events orientation.” Transactions are classified as either exchange transactions involving external entities or internal transactions such as those involving the use of a depreciable asset. such events are not viewed as transactions and are therefore typically not “accounted for” within the accounting system. It is easy to see how the traditional “transactions orientation” can result in valuable information being omitted from the accounting information

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