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Identify the Accounting Information System Principle Below That Applies to Each

Question 181

Matching

Identify the accounting information system principle below that applies to each of these situations:

A. Flexibility
B. Compatibility
C. Control
D. Cost-benefit
E. Relevance

Premises:

Responses:

Global Company has designed its accounting information system so that key managers can obtain the information they need to make decisions relating to new products, sales, and controlling costs

Flexibility

Global Company's accounting information system has policies to ensure that financial statements are reliable, assets are protected, and relevant laws and regulations are complied with.

Compatibility

Global Company's accounting information system can be improved markedly for a cost of about $30,000,000. However, the incremental benefits from such improvements are not expected to outweigh this cost.

Control

Global Company has worldwide operations that must handle several thousand different products, so the accounting information system is fairly complex, encompassing marketing and manufacturing.

Cost-benefit

Global Company has designed its accounting information system to be adaptable to changes in technology, the business environment, and the needs of decision makers.

Relevance

Premises:

Global Company has designed its accounting information system so that key managers can obtain the information they need to make decisions relating to new products, sales, and controlling costs

Global Company's accounting information system has policies to ensure that financial statements are reliable, assets are protected, and relevant laws and regulations are complied with.

Global Company has worldwide operations that must handle several thousand different products, so the accounting information system is fairly complex, encompassing marketing and manufacturing.

Global Company has designed its accounting information system to be adaptable to changes in technology, the business environment, and the needs of decision makers.

Responses:

Flexibility

Compatibility

Control

Cost-benefit

Relevance

Correct Answer:

Premises:

Responses:

Global Company has designed its accounting information system so that key managers can obtain the information they need to make decisions relating to new products, sales, and controlling costs

Global Company's accounting information system has policies to ensure that financial statements are reliable, assets are protected, and relevant laws and regulations are complied with.

Global Company has worldwide operations that must handle several thousand different products, so the accounting information system is fairly complex, encompassing marketing and manufacturing.

Global Company has designed its accounting information system to be adaptable to changes in technology, the business environment, and the needs of decision makers.

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