UNIVERSITY OF BOHOL

COLLEGE OF BUSINESS AND ACCOUNTANCY

COMP 1C ACCOUNTING INFORMATION SYSTEM LECTURE

FINAL EXAMINATION

NAME: _____________________________________________ Thursday, April 7, 2021

COURSE & YEAR: _____________________________________ Instructor: Karen C. Labor, CPA

Multiple Choice d. Most computer systems are designed so that transaction trails
useful for audit purposes do not exist.
1. A software package that is used with a large set of organized data
that presents the computer as an expert on a particular topic is 11. A general type of IT system that is designed to improve the
referred to as a(n) productivity of daily office work is referred to as a(n)
a. Data mining. a. Office automation system.
b. Expert system. b. Transaction processing system.
c. Artificial intelligence. c. Decision support system.
d. Virtual reality. d. Executive information system.

2. Computer memory which is used to store programs that must be 12. The Systems Development Life Cycle (SDLC) is the traditional
accessed immediately by the central processing unit is methodology for developing information systems. In which phase of
a. Primary storage. the SDLC would the activity of identifying the problem(s) that need
b. Secondary storage. to be solved most likely occur?
c. Tertiary storage. a. Analysis.
d. Tape storage. b. Implementation.
c. Planning.
3. The most common output device is a(n) d. Development.
a. Mouse.
b. Printer. 13. Samco Inc. is in the process of designing a new customer
c. Expert system. relations system. In which phase of the development life-cycle would
d. Keyboard. a needs assessment most likely be performed?
a. Analysis.
4. The part of the computer that does most of the data processing is b. Design.
referred to as the c. Development.
a. Analyzer. d. Testing.
b. Compiler.
c. CPU. 14. Which of the following system implementation models has the
d. Printer. advantage of achieving a full operational test of the new system
before it is implemented?
5. An “office suite” of software is least likely to include a(n) a. Parallel implementation.
a. Database. b. Plunge implementation.
b. Operating system. c. Pilot implementation.
c. Spreadsheet. d. Phased implementation.
d. Word processing.
B. Characteristics of Computer Systems—General
6. Software that performs a variety of general technical
computer-controlling operations is a(n) 15. Which computer application is most frequently used on
a. Integrated “suite.” mainframe computers?
b. Shareware. a. Databases.
c. Database. b. Graphics.
d. Operating system. c. Spreadsheets.
d. Word processing.
7. Which of the following is not a part of the central processing unit?
a. Control unit. 16. Which computer application is most frequently used to analyze
b. Arithmetic unit. numbers and financial information?
c. Logic unit. a. Computer graphics programs.
d. Printer unit. b. WAN applications.
c. Spreadsheets.
8. MIPS stands for d. Word processing programs.
a. Memory in protocol standards.
b. Millions of instructions per second. 17. Analysis of data in a database using tools which look for trends or
c. Mitigating individualistic personnel standards. anomalies without knowledge in advance of the meaning of the data
d. Multiple input physical savings. is referred to as
a. Artificial intelligence.
9. Which of the following represents a type of applications software b. Data mining.
that a large client is most likely to use? c. Virtual reality.
a. Enterprise resource planning. d. Transitory analysis.
b. Operating system.
c. Central processing unit. 18. The most common type of primary storage in a computer is
d. Value-added network. referred to as
a. CMAN.
10. Which of the following characteristics distinguishes computer b. RAM.
processing from manual processing? c. ROM.
a. Computer processing virtually eliminates the occurrence of d. Flash memory.
computational error normally associated with manual processing.
b. Errors or fraud in computer processing will be detected soon after 19. A set of step-by-step procedures used to accomplish a task is a(n)
their occurrences. a. Algorithm.
c. The potential for systematic error is ordinarily greater in manual b. Compilation master.
processing than in computerized processing. c. Linux.
d. Transistor.
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20. Which of the following compiles a complete translation of a c. Batch processing system.
program in a high-level computer language before the program is d. Online real-time system.
run for the first time?
a. Visual Basic. 32. Which of the following characteristics distinguishes electronic
b. Java. data interchange (EDI) from other forms of electronic commerce?
c. Algorithm. a. EDI transactions are formatted using the standards that are
d. Compiler. uniform worldwide.
b. EDI transactions need not comply with generally accepted
21. GUI is the abbreviation for accounting principles.
a. Grandfather, Uncle, Individual. c. EDI transactions ordinarily are processed without the Internet.
b. Graphical User Interface. d. EDI transactions are usually recorded without security and privacy
c. Graphics Utilization Institutes. concerns.
d. Grand Union Internet.
33. LAN is the abbreviation for
22. Unix is a(n) a. Large Area Network.
a. Operating system. b. Local Area Network.
b. Singular disk drive. c. Longitudinal Analogue Network.
c. Central processing unit. d. Low Analytical Nets.
d. Logic unit.
34. A computer that is designed to provide software and other
23. In a spreadsheet, each specific cell may be identified by a specific applications to other computers is referred to as a
a. Address. a. Microcomputer.
b. Column. b. Network computer.
c. Row. c. Server.
d. Diagonal. d. Supercomputer.

24. In a spreadsheet, which of the following is correct concerning 35. Which is least likely to be considered a component of a computer
rows and columns? network?
a. Applications programs.
Rows Columns b. Computers.
a. Numbered Numbered c. Software.
b. Numbered Lettered d. Routers.
c. Lettered Numbered
d. Lettered Lettered 36. The network most frequently used for private operations
designed to link computers within widely separated portions of an
25. Which of the following is least likely to be considered an organization is referred to as a(n)
advantage of a database? a. Bulletin board service.
a. Easy to store large quantities of information. b. Local area network.
b. Easy to retrieve information quickly. c. Wide area network.
c. Easy to organize and reorganize information. d. Zero base network.
d. Easy to distribute information to every possible user.
37. A set of rules for exchanging data between two computers is a
26. Most current computers process data using which of the a. Communicator.
following formats? b. Operating system.
a. Analog. c. Protocol.
b. Digital. d. Transmission speed.
c. Memory enhanced.
d. Organic. 38. A webpage is most frequently created using
a. Java or C++.
27. Which term below describes the technology that allows multiple b. Visual Basic.
operating systems to run simultaneously on a single computer? c. SQL.
a. Client. d. HTML or XML.
b. Mainframe.
c. Linux. 39. Laptop computers provide automation outside of the normal
d. Virtualization. office location. Which of the following would provide the least
security for sensitive data stored on a laptop computer?
28. What type of secondary storage device requires no moving parts a. Encryption of data files on the laptop computer.
for read/write operations? b. Setting up a password for the screensaver program on the laptop
a. Magnetic tape. computer.
b. Compact discs. c. Using a laptop computer with a removable hard disk drive.
c. Solid State drives. d. Using a locking device that can secure the laptop computer to an
d. RAID. immovable object.

29. Another term for cloud-based storage is 40. When developing a new computer system that will handle
a. RAID. customer orders
b. Solid state storage. and process customer payments, a high-level systems design phase
c. Analog. would include determination of which of the following?
d. Storage-as-a-Service. a. How the new system will affect current inventory and general
ledger systems.
30. The wireless input device that is used for inventory control and b. How the file layouts will be structured for the customer order
similar to bar-codes technology but does not require line-of sight records.
access is c. Whether to purchase a turn-key system or modify an existing
a. MICR. system.
b. RFID. d. Whether formal approval by top management is needed for the
c. Touch screen. new system.
d. Point-of-sale recorders.
**41. A company using EDI made it a practice to track the functional
31. What type of computer system is characterized by data that are acknowledgments from trading partners and to issue warning
assembled from more than one location and records that are messages if acknowledgments did not occur within a reasonable
updated immediately? length of time. What risk was the company attempting to address by
a. Microcomputer system. this practice?
b. Minicomputer system.

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a. Transactions that have not originated from a legitimate trading
partner may be inserted into the EDI network.
b. Transmission of EDI transactions to trading partners may
sometimes fail.
c. There may be disagreement between the parties as to whether
the EDI transactions form a legal contract.
d. EDI data may not be accurately and completely processed by the
EDI software.
42. Management is concerned that data uploaded from a
microcomputer to the company’s mainframe system in batch
processing may be erroneous. Which of the following controls would
best address this issue?
a. The mainframe computer should be backed up on a regular basis.
b. Two persons should be present at the microcomputer when it is
uploading data.
c. The mainframe computer should subject the data to the same
edits and validation routines that online data entry would require.
d. The users should be required to review a random sample of
processed data.
Items 43 and 44 are based on the following information:
One major category of computer viruses is programs that attach
themselves to other programs, thus infecting the other programs.
While many of these viruses are relatively harmless, some have the
potential to cause significant damage.
43. Which of the following is an indication that a computer virus of
this category is present?
a. Frequent power surges that harm computer equipment.
b. Unexplainable losses of or changes to data.
c. Inadequate backup, recovery, and contingency plans.
d. Numerous copyright violations due to unauthorized use of
purchased software.
44. Which of the following operating procedures increases an
organization’s exposure to computer viruses?
a. Encryption of data files.
b. Frequent backup of files.
c. Downloading public-domain software from electronic bulletin
boards.
d. Installing original copies of purchased software on hard disk
drives.
45. Which of the following is a risk that is higher when an electronic
funds transfer (EFT) system is used?
a. Improper change control procedures.
b. Unauthorized access and activity.
c. Insufficient online edit checks.
d. Inadequate backups and disaster recovery procedures.
46. The use of message encryption software
a. Guarantees the secrecy of data.
b. Requires manual distribution of keys.
c. Increases system overhead.
d. Reduces the need for periodic password changes.
**47. A company’s management is concerned about computer data
eavesdropping and wants to maintain the confidentiality of its
information as it is transmitted. The company should utilize
a. Data encryption.
b. Dial-back systems.
c. Message acknowledgement procedures.
d. Password codes.
48. Which of the following is likely to be a benefit of electronic data
interchange (EDI)?
a. Increased transmission speed of actual documents.
b. Improved business relationships with trading partners.
c. Decreased liability related to protection of proprietary business
data.
d. Decreased requirements for backup and contingency planning.
49. The internal auditor is reviewing a new policy on electronic mail.
Appropriate elements of such a policy would include all of the
following except:
a. Erasing all employee’s electronic mail immediately upon
employment termination.
b. Encrypting electronic mail messages when transmitted over
phone lines.
c. Limiting the number of electronic mail packages adopted by the
organization.
d. Directing that personnel do not send highly sensitive or
confidential messages using electronic mail.
50. Which of the following risks is more likely to be encountered in
an end-user computing (EUC) environment as compared to a
mainframe computer system?
a. Inability to afford adequate uninterruptible power supply systems.
b. User input screens without a graphical user interface (GUI).
c. Applications that are difficult to integrate with other information
systems.
d. Lack of adequate utility programs.
51. The 2nd generation programming language that is generally
specific to a computer architecture (i.e., it is not portable) is
a. Binary.
b. Assembly language.
c. COBOL.
d. C++.
52. The online analytical processing term that represents a
combination of systems that help aggregate, access, and analyze
business data and assist in the business decision-making process is
a. Artificial intelligence.
b. Data mart.
c. Decision support system.
d. Business intelligence.
53. What is the hierarchy of data organization, from smallest to
largest unit, for a relational database?
a. Bit, byte, field, record, table, database.
b. Byte, bit, record, field, table, database.
c. Byte, bit, table, field, record, database.
d. Database, table, field, record, byte, bit.
54. A current day instruction to a computer such as “Extract all
Customers where ‘Name’ is Smith” would most likely relate to a
a. First generation programming language.
b. Fourth generation programming language.
c. Seventh generation programming language.
d. Ninth generation programming language.
55. Several language interfaces exist in a database management
system. These typically include a data definition language (DDL), a
data control language (DCL), a data manipulation language (DML),
and a database query language (DQL). What language interface
would a database administrator use to establish the structure of
database tables?
a. DDL.
b. DCL.
c. DML.
d. DQL.
56. Users making database queries often need to combine several
tables to get the information they want. One approach to combining
tables is known as
a. Joining.
b. Merging.
c. Projecting.
d. Pointing.
57. User acceptance testing is more important in an object-oriented
development process than in a traditional environment because of
the implications of the
a. Absence of traditional design documents.
b. Lack of a tracking system for changes.
c. Potential for continuous monitoring.
d. Inheritance of properties in hierarchies.
58. A company's management has expressed concern over the
varied system architectures that the organization uses. Potential
security and control concerns would include all of the following
except:
a. Users may have different user ID codes and passwords to
remember for the several systems that they use.
b. There are difficulties in developing uniform security standards for
the various platforms.
c. Backup file storage administration is often decentralized.
d. Having data distributed across many computers throughout the
organization increases the risk that a single disaster would destroy
large portions of the organization’s data.
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59. All of the following are methods for distributing a relational
database across multiple servers except:
a. Snapshot (making a copy of the database for distribution).
b. Replication (creating and maintaining replica copies at multiple
locations).
c. Normalization (separating the database into logical tables for
easier user processing).
d. Fragmentation (separating the database into parts and
distributing where they are needed).
60. Client/server architecture may potentially involve a variety of
hardware, systems software, and application software from many
vendors. The best way to protect a client/server system from
unauthorized access is through
a. A combination of application and general access control
techniques.
b. Use of a commercially available authentication system.
c. Encryption of all network traffic.
d. Thorough testing and evaluation of remote procedure calls.
61. What technology is needed in order to convert a paper
document into a computer file?
a. Optical character recognition.
b. Electronic data interchange.
c. Bar-coding scanning.
d. Joining and merging.
62. Unauthorized alteration of online records can be prevented by
employing
a. Key verification.
b. Computer sequence checks.
c. Computer matching.
d. Database access controls.
63. A manufacturer of complex electronic equipment such as
oscilloscopes and microscopes has been shipping its products with
thick paper manuals but wants to reduce the cost of producing and
shipping this documentation. Of the following, the best medium for
the manufacturer to use to accomplish this is
a. Write-once-read-many.
b. Digital audio tape.
c. Compact disc/read-only memory.
d. Computer-output-to-microform.
64. Misstatements in a batch computer system caused by incorrect
programs or data may not be detected immediately because
a. Errors in some transactions may cause rejection of other
transactions in the batch.
b. The identification of errors in input data typically is not part of the
program.
c. There are time delays in processing transactions in a batch system.
d. The processing of transactions in a batch system is not uniform.
65. Which of the following is not a characteristic of a batch
processed computer system?
a. The collection of like transactions which are sorted and processed
sequentially against a master file.
b. Keypunching of transactions, followed by machine processing.
c. The production of numerous printouts.
d. The posting of a transaction, as it occurs, to several files, without
intermediate printouts.
66. Able Co. uses an online sales order processing system to process
its sales transactions. Able’s sales data are electronically sorted and
subjected to edit checks. A direct output of the edit checks most
likely would be a
a. Report of all missing sales invoices.
b. File of all rejected sales transactions.
c. Printout of all user code numbers and passwords.
d. List of all voided shipping documents.
67. First Federal S & L has an online real-time system, with terminals
installed in all of its branches. This system will not accept a
customer’s cash withdrawal instructions in excess of $1,000 without
the use of a “terminal audit key.” After the transaction is authorized
by a supervisor, the bank teller then processes the transaction with
the audit key. This control can be strengthened by
a. Online recording of the transaction on an audit override sheet.
b. Increasing the dollar amount to $1,500.
c. Requiring manual, rather than online, recording of all such
transactions.
d. Using parallel simulation.
68. Mill Co. uses a batch processing method to process its sales
transactions. Data on Mill’s sales transaction tape are electronically
sorted by customer number and are subjected to programmed edit
checks in preparing its invoices, sales journals, and updated
customer account balances. One of the direct outputs of the
creation of this tape most likely would be a
a. Report showing exceptions and control totals.
b. Printout of the updated inventory records.
c. Report showing overdue accounts receivable.
d. Printout of the sales price master file.
69. Where disk files are used, the grandfather-father-son updating
backup concept is relatively difficult to implement because the
a. Location of information points on disks is an extremely
time-consuming task.
b. Magnetic fields and other environmental factors cause off-site
storage to be impractical.
c. Information must be dumped in the form of hard copy if it is to be
reviewed before used in updating.
d. Process of updating old records is destructive.
**70. In a computerized system, procedure or problem-oriented
language is converted to machine language through a(n)
a. Interpreter.
b. Verifier.
c. Compiler.
d. Converter.
71. Which of the following risks is not greater in an electronic funds
transfer (EFT) environment than in a manual system using paper
transactions?
a. Unauthorized access and activity.
b. Duplicate transaction processing.
c. Higher cost per transaction.
d. Inadequate backup and recovery capabilities.
72. Methods to minimize the installation of unlicensed
microcomputer software include all of the following except:
a. Employee awareness programs.
b. Regular audits for unlicensed software.
c. Regular monitoring of network access and start-up scripts.
d. An organizational policy that includes software licensing
requirements.
73. In traditional information systems, computer operators are
generally responsible for backing up software and data files on a
regular basis. In distributed or cooperative systems, ensuring that
adequate backups are taken is the responsibility of
a. User management.
b. Systems programmers.
c. Data entry clerks.
d. Tape librarians.
74. An auditor is least likely to find that a client’s data is input
through
a. Magnetic tape reader.
b. Dynamic linking character reader.
c. Point-of-sale recorders.
d. Touch sensitive screens.
75. End-user computing is an example of which of the following?
a. Client/server processing.
b. A distributed system.
c. Data mining.
d. Decentralized processing.
76. End-user computing is most likely to occur on which of the
following types of computers?
a. Mainframe.
b. Minicomputers.
c. Personal computers.
d. Personal reference assistants.
77. Which of the following statements is correct regarding the
Internet as a commercially viable network?
a. Organizations must use firewalls if they wish to maintain security
over internal
data.
b. Companies must apply to the Internet to gain permission to create
a homepage
to engage in electronic commerce.
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c. Companies that wish to engage in electronic commerce on the
Internet must meet required security standards established by the
coalition of Internet providers.
d. All of the above.
78. To reduce security exposure when transmitting proprietary data
over communication lines, a company should use
a. Asynchronous modems.
b. Authentic techniques.
c. Call-back procedures.
d. Cryptographic devices.
79. Securing client/server systems is a complex task because of all of
the following factors except:
a. The use of relational databases.
b. The number of access points.
c. Concurrent operation of multiple user sessions.
d. Widespread data access and update capabilities.
80. Which of the following would an auditor ordinarily consider the
greatest risk regarding an entity’s use of electronic data interchange
(EDI)?
a. Authorization of EDI transactions.
b. Duplication of EDI transmissions.
c. Improper distribution of EDI transactions.
d. Elimination of paper documents.
81. Which of the following characteristics distinguish electronic data
interchange (EDI) from other forms of electronic commerce?
a. The cost of sending EDI transactions using a value-added network
(VAN) is less than the cost of using the Internet.
b. Software maintenance contracts are unnecessary because
translation software for EDI transactions need not be updated.
c. EDI commerce is ordinarily conducted without establishing legally
binding contracts between trading partners.
d. EDI transactions are formatted using strict standards that have
been agreed to worldwide.
82. Which of the following is considered a component of a local area
network?
a. Program flowchart.
b. Loop verification.
c. Transmission media.
d. Input routine.
83. Which of the following represents an additional cost of
transmitting business transactions by means of electronic data
interchange (EDI) rather than in a traditional paper environment?
a. Redundant data checks are needed to verify that individual EDI
transactions are not recorded twice.
b. Internal audit work is needed because the potential for random
data entry errors is increased.
c. Translation software is needed to convert transactions from the
entity’s internal format to a standard EDI format.
d. More supervisory personnel are needed because the amount of
data entry is greater in an EDI system.
84. Many entities use the Internet as a network to transmit
electronic data interchange (EDI) transactions. An advantage of using
the Internet for electronic commerce rather than a traditional
value-added network (VAN) is that the Internet
a. Permits EDI transactions to be sent to trading partners as
transactions occur.
b. Automatically batches EDI transactions to multiple trading
partners.
c. Possesses superior characteristics regarding disaster recovery.
d. Converts EDI transactions to a standard format without translation
software.
85. Which of the following is not considered an exposure involved
with electronic data interchange (EDI) systems as compared to other
systems?
a. Increased reliance upon computer systems.
b. Delayed transaction processing time.
c. Possible loss of confidentiality of information.
d. Increased reliance upon third parties.
86. Which of the following statements is correct concerning internal
control when a client is using an electronic data interchange system
for its sales?
a. Controls should be established over determining that all suppliers
are included in the system.
b. Encryption controls may help to assure that messages are
unreadable to unauthorized persons.
c. A value-added-network (VAN) must be used to assure proper
control.
d. Attention must be paid to both the electronic and “paper”
versions of transactions.
87. Which of the following statements most likely represents a
disadvantage for an entity that keeps microcomputer-prepared data
files rather than manually prepared files?
a. Random error associated with processing similar transactions in
different ways is usually greater.
b. It is usually more difficult to compare recorded accountability with
physical count of assets.
c. Attention is focused on the accuracy of the programming process
rather than errors in individual transactions.
d. It is usually easier for unauthorized persons to access and alter the
files.
88. Which of the following is usually a benefit of transmitting
transactions in an electronic data interchange (EDI) environment?
a. A compressed business cycle with lower year-end receivables
balances.
b. A reduced need to test computer controls related to sales and
collections transactions.
c. An increased opportunity to apply statistical sampling techniques
to account balances.
d. No need to rely on third-party service providers to ensure security.
89. Which of the following is a network node that is used to improve
network traffic and to set up as a boundary that prevents traffic from
one segment to cross over to another?
a. Router.
b. Gateway.
c. Firewall.
d. Heuristic.
90. Which of the following is an example of how specific controls in a
database environment may differ from controls in a nondatabase
environment?
a. Controls should exist to ensure that users have access to and can
update only the data elements that they have been authorized to
access.
b. Controls over data sharing by diverse users within an entity should
be the same for every user.
c. The employee who manages the computer hardware should also
develop and debug the computer programs.
d. Controls can provide assurance that all processed transactions are
authorized, but cannot verify that all authorized transactions are
processed.
91. A retail entity uses electronic data interchange (EDI) in executing
and recording most of its purchase transactions. The entity’s auditor
recognized that the documentation of the transactions will be
retained for only a short period of time. To compensate for this
limitation, the auditor most likely would
a. Increase the sample of EDI transactions to be selected for cutoff
tests.
b. Perform tests several times during the year, rather than only at
year-end.
c. Plan to make a 100% count of the entity’s inventory at or near the
year-end.
d. Decrease the assessed level of control risk for the existence or
occurrence assertion.
92. Which of the following is an encryption feature that can be used
to authenticate the originator of a document and ensure that the
message is intact and has not been tampered with?
a. Heuristic terminal.
b. Perimeter switch.
c. Default settings.
d. Digital signatures.
93.In building an electronic data interchange (EDI) system, what
process is used to determine which elements in the entity’s
computer system correspond to the standard data elements?
a. Mapping.
b. Translation.
c. Encryption.
d. Decoding.
94. Which of the following passwords would be most difficult to
crack?
5
a. OrCa!FlSi
b. language
c. 12 HOUSE 24
d. pass56word

95. Which of the following is a password security problem?

a. Users are assigned passwords when accounts are created, but do
not change them.
b. Users have accounts on several systems with different passwords.
c. Users copy their passwords on note paper, which is kept in their
wallets.
d. Users select passwords that are not listed in any online dictionary.

96. Many of the Web 2.0 applications rely on an XML-based

application that facilitates the sharing and syndication of web
content, by subscription, Which of the applications below represents
this XML application?
a. Wiki.
b. Blog.
c. RSS/Atom Feeds.
d. Twitter.

D. Control Objectives for Information and Related Technology

(COBIT)

97. Which of the following is not one of the five principles of COBIT
5?
a. Meeting stakeholder needs.
b. Business processes.
c. Covering the enterprise end-to-end.
d. Applying a single integrated framework.

98. The Control Objectives for Information and Related Technology

(COBIT) framework has been established by:
a. The American Institute of Certified Public Accountants.
b. The Information Technology Institute.
c. The Information Systems Audit and Control Association.
d. The Committee of Sponsoring Organizations.

E. Effect of IT on Internal Control

99. Which of the following procedures would an entity most likely

include in its computer disaster recovery plan?
a. Develop an auxiliary power supply to provide uninterrupted
electricity.
b. Store duplicate copies of critical files in a location away from the
computer center.
c. Maintain a listing of entity passwords with the network manager.
d. Translate data for storage purposes with a cryptographic secret
code.

100. A company is concerned that a power outage or disaster could

impair the computer hardware’s ability to function as designed. The
company desires off-site backup hardware facilities that are fully
configured and ready to operate within several hours. The company
most likely should consider a
a. Cold site.
b. Cool site.
c. Warm site.
d. Hot site.