Accounting Information Systems Have Five Generic Elements

question 43

Essay

Accounting information systems have five generic elements.Identify and describe one example of each element in the sales/collection process of Homemade Crafts Company based on the following narrative:
Homemade Crafts Company (HCC) sells collectible items such as dolls, jewelry, drink coasters and table linens.The company, which has five full-time employees, obtains its merchandise from independent contractors throughout the United States; they then mark up the products and sell them at craft stores and other outlets.Two of the five employees interact with the independent contractors, arranging inventory purchases based on demand for HCC's products and their own personal preferences.Those same employees use their personal vehicles to transport the inventory from HCC's main office to the retail locations where they will be sold.A third employee serves as the company's receptionist, while the fourth manages all aspects of the accounting information system.The company president is the fifth employee, and is in charge of administrative affairs such as hiring, performance evaluation and publicity.HCC purchases its entire inventory on account from the independent contractors, some of whom offer cash discount terms for early payment.All HCC's sales are for cash; each inventory item is marked up 25% on its cost to determine the selling price.For example, if a product costs $100 to buy, HCC sells it for $125.The two sales employees bring all cash receipts back to HCC's main office; the receptionist deposits the cash in the bank at least once a week.

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Definitions:

Credibility

The quality of being trusted and believed in, an essential aspect of effective communication and argumentation.

Career Services Centers

Institutions or offices within educational organizations that provide students and alumni with career advice, job search assistance, and other employment-related services.

Electronic Portfolios

Collections of digital artifacts and evidence of an individual's achievements, skills, experiences, and learning, often used for education, assessment, or career development.

Application Message

Communication that typically serves a specific purpose, such as applying for a job, school, or grant, often requiring a particular format or structure.