In Contrast with Other Areas of Accounting, AIS More Frequently

question 38

Short Answer

In contrast with other areas of accounting, AIS more frequently involves problems with non-deterministic answers.Which questions in the list below have non-deterministic answers?
a.How do you calculate depreciation using the straight-line method?
b.How many accountants should ITI Corporation hire?
c.Should ITI Corporation expand its operations to other countries?
d.Should ITI Corporation reconcile its bank statement at least once a month?
e.Should ITI Corporation use Quickbooks or Peachtree for transaction processing?
f.Should Thai use information from textbooks as one source in a paper for her AIS course?
g.What is the journal entry to record a cash sale?
h.Which inventory cost flow assumption (FIFO, LIFO) does ITI Corporation use?
i.Which local bank should ITI Corporation do business with?
j.With respect to financial reporting, is relevance more important than reliability?

---

Definitions:

Efficiency

The effectiveness with which a system, process, or organization uses its resources to achieve its objectives, often with minimum waste or effort.

Allocating Resources

The process of assigning available resources, such as time, money, and labor, to specific uses to achieve an organization's objectives.

Equilibrium

A state in which market supply and demand balance each other, and, as a result, prices become stable.

Market Fluctuation

Variations in the market prices of goods, services, or securities due to changes in supply and demand, investor sentiment, or other factors.