A Well-Designed AIS Can Improve the Decision-Making Function Within the Organization.Which

question 8

Multiple Choice

A well-designed AIS can improve the decision-making function within the organization.Which statement below would describe a limitation,rather than a benefit,of an efficient AIS?

• A) An AIS reduces uncertainty, and therefore accounting information can provide a basis for choosing among alternative courses of action.
• B) An AIS identifies situations requiring management action.
• C) An AIS provides to its users an abundance of information without any filtering or condensing of such information.
• D) An AIS provides information about the results of previous decisions which provides decision makers with feedback that can be used in future decision making.

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Definitions:

High-low Method

A way to estimate the cost-behavior formula that uses the highest and lowest levels of activity to determine fixed and variable costs.

Activity Index

A measure or indicator used to gauge activity levels within a particular domain, such as manufacturing or stock trading volume.

Process Cost System

A cost accounting system used when a company manufactures a large volume of similar products.

Manufacturing Processes

Manufacturing processes are the methods and techniques used to convert raw materials into finished goods.