Chapter 3, Problem 1Q

To determine

To describe: The Accounting Information System (AIS)

Explanation of Solution

Accounting Information System (AIS):

• The Accounting Information System is a system that a business uses for collecting, storing, and processing the data of the accounting transactions and provides the financial information to the decision makers, such as investors, creditors, and tax authorities that help them in taking informed decision. In this system, the accounting data are processed in the computer with the help of the Information technology.
• The accounting information system differs from one company to the other company depending on the various factors which are as follows:
  • Nature of the business of the company
  • Types of transactions
  • Size of the company
  • Volume of data
  • Information demands of the decision makers
• In the competitive world, the company should keep on improving its accounting information system, on a continual basis, to provide the accurate and timely data to the decision makers that help them in taking informed decision.