Which of the Following Is True of the Comparison Between

question 127

Multiple Choice

Which of the following is true of the comparison between a manual and a computerized accounting information system?

• A)In both manual and computerized systems, reports and financial statements must be created using Word documents, Excel spreadsheets, or PowerPoint.
• B)In a computerized system, the software can generate financial reports instantaneously that can never be manipulated.
• C)In a manual system, data are contained in paper documents that are often stored in filing cabinets and off-site document warehouses; whereas in a computerized system, data are stored on a main computer called a server.
• D)In both manual and computerized systems, processing data includes manually journalizing transactions and posting to the accounts.

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Definitions:

Partial Equity Method

A method of accounting for investments where the investor recognizes its share of the profits and losses of the investee, to the extent of its initial investment, in its financial statements.

Noncontrolling Interest

A portion of equity (ownership) interest in a subsidiary not owned by the parent company, reflecting the share of the subsidiary not attributable directly to the parent company's shareholders.

Equipment Undervalued

A situation where the recorded book value of equipment on the financial statements is less than its current market value.

Partial Equity Method

An accounting approach used for investments where the investor has significant influence but not full control, recognizing income based on the proportionate share of the investee's earnings.