A Well-Designed Accounting Information System Recognizes and Adapts to the Cost-Benefit

question 17

Multiple Choice

A well-designed accounting information system recognizes and adapts to the cost-benefit constraint of the conceptual framework. Which of the following is most likely to violate the cost-benefit constraint?

• A) Translating financial statements into six major global languages.
• B) Giving every member of the accounting staff access to a network.
• C) Using debits and credits to record transactions.
• D) Converting financial statements prepared in one currency to another currency.

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Definitions:

Unpaid Vouchers

Refers to vouchers, which represent obligations or promises to pay, that have not yet been settled or paid.

Gross Method

An accounting method for recording purchases of inventory at their full invoice prices without deducting any cash discounts offered.

Periodic Inventory Method

A system of inventory management and cost determination that updates the ending inventory balance and the cost of goods sold only at the end of an accounting period.

Purchases

Transactions involving the acquisition of goods or services for personal use, resale, or business operations.