Accounting Information System Definition - According to the Text, an Accounting

question 16

Essay

Accounting information system definition - According to the text, an accounting information system is a set of interrelated activities, documents and technologies designed to collect data, process it and report information to a diverse group of internal and external decision makers in organizations. Consider that definition in light of the following scenario:
A local video store purchases multiple copies of popular movies and television series by issuing electronic purchase orders. When the movies come in, a clerk fills out a receiving report and puts the movies on the shelves by category (e.g., all the comedies together). Each copy of each movie receives a bar code that identifies it for inventory purposes. When a client selects a movie to rent, a clerk scans the bar code; the company's information system updates its database. The client receives an invoice noting the title of the video, the rental date, the clerk's name and the due date. At the end of each month, the store manager downloads the rental and purchase information and transmits it to the store's accountant. The accountant prepares a monthly income statement, balance sheet and bank reconciliation and sends them back to the store within three days. The store manager reviews all three with the employees.
Analyze the video store's accounting information system by identifying two examples of each item in the grid below. Record your answers in the spaces provided. $\begin{array}{|l|l|l|}\hline \text { Activities } &\quad\quad\quad\quad\quad&\quad\quad\quad\quad\quad \\\hline \text { Data } & \\\hline \text { Decision makers }\\\hline \text { Documents}\\\hline \text { Information}\\\hline \text { Technologies}\\\hline \end{array}$

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Definitions:

Pension Expense

represents the cost incurred by an employer for maintaining a retirement benefits plan for its employees over a specific period.

Defined Benefit Pension Plan

A type of pension plan where an employer promises a specified pension payment upon retirement, determined by an employee's earnings history, tenure of service, and age.

Interest Cost Component

The portion of pension expense that reflects the increase in the projected benefit obligation due to the passage of time.

Defined Benefit Pension Plan

A defined benefit pension plan is a retirement plan where the employer promises a specified pension payment upon retirement, based on an employee's earnings history, tenure of service, and age.