The Control Principle for Accounting Information Systems Requires That The

question 31

Multiple Choice

The control principle for accounting information systems requires that the:

• A) System report useful, understandable, timely, and pertinent information for effective decision making.
• B) System be able to adjust to changes in the company, business environment, and needs of decision makers.
• C) System conforms to a company's activities, personnel, and structure.
• D) Benefits from an activity outweigh the costs of the activity.
• E) System must have methods and procedures allowing managers to control and monitor business activities.

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Definitions:

Multiple IRRs

Situations where a project or investment has more than one internal rate of return, occurring with alternating cash flows (positive and negative).

Cash Flows

Cash flow is the net amount of cash being transferred into and out of a business, considered essential for its operation, liquidity, and financial health.

WACC

The Weighted Average Cost of Capital (WACC) is the rate that a company is expected to pay on average to all its security holders to finance its assets.

WACC

Weighted Average Cost of Capital (WACC) is the average rate that a company is expected to pay to finance its assets, incorporating the cost of equity and debt.