An Accounting Information System Should Be Cost Effective; That Is

question 98

True/False

An accounting information system should be cost effective; that is the benefits of the information must outweigh the cost of providing it.

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Definitions:

Current Assets

Assets that are expected to be converted into cash, sold, or consumed within the year or within the operating cycle of the business, whichever is longer.

Current Liabilities

Short-term financial obligations that are due within one year or within the normal operating cycle.

Cash Flows

The aggregate sum of funds moving in and out of a company, particularly influencing its ability to cover short-term obligations.

Indirect Method

A technique used in cash flow statements to adjust net income for changes in non-cash items to calculate net cash from operating activities.