Information Systems Management (C724)
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Free Information Systems Management (C724) Questions
What is the purpose of a data warehouse in a database system
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Data encryption and security
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Real-time data processing
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Data visualization and reporting
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Data analysis and reporting
Explanation
Correct Answer D. Data analysis and reporting
Explanation
A data warehouse is a centralized repository designed to store and manage large volumes of structured data for analytical and reporting purposes. It integrates data from multiple sources, allowing businesses to perform complex queries and generate meaningful insights for decision-making.
Why other options are wrong
A. Data encryption and security – While security is important for a data warehouse, its primary purpose is data analysis and reporting, not encryption or security management.
B. Real-time data processing – Data warehouses typically store historical data for analysis rather than processing real-time transactions. Real-time processing is handled by OLTP systems.
C. Data visualization and reporting – While a data warehouse supports reporting, the visualization aspect is handled by business intelligence tools that extract data from the warehouse. The warehouse itself is mainly used for storing and managing analytical data.
Who are the primary users of AIS
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Doctors
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Accountants and financial managers
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Engineers
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Chefs
Explanation
Correct Answer B. Accountants and financial managers
Explanation
AIS (Accounting Information Systems) are designed to collect, process, and store financial and accounting data. These systems support financial reporting, auditing, and decision-making for businesses. Accountants and financial managers use AIS to track transactions, analyze financial statements, and ensure compliance with regulations.
Why other options are wrong
A. Doctors – Doctors primarily use health information systems (HIS) and electronic medical records (EMR), not AIS, as their focus is on patient care rather than financial management.
C. Engineers – Engineers rely on CAD (Computer-Aided Design) software and project management tools rather than accounting systems for their work.
D. Chefs – Chefs use restaurant management and inventory systems rather than AIS, as their primary focus is food preparation and operations, not financial record-keeping
What is the purpose of normalization in a database
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To organize data and improve efficiency
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To introduce inconsistency in data
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To complicate data storage
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To increase duplication in the database
Explanation
Correct Answer A. To organize data and improve efficiency
Explanation
Normalization is a process in database design that structures data to reduce redundancy and improve efficiency. It organizes data into related tables and enforces relationships, ensuring consistency and integrity. This minimizes data anomalies and enhances query performance.
Why other options are wrong
B. To introduce inconsistency in data – Normalization actually reduces inconsistency by enforcing rules that maintain data integrity and avoid duplication.
C. To complicate data storage – The purpose of normalization is not to make data storage more complex but to streamline it by organizing data properly. While it may require additional tables, it ultimately improves efficiency and usability.
D. To increase duplication in the database – Normalization reduces duplication by eliminating redundant data and ensuring that each piece of information is stored only once in the appropriate place.
Data redundancy produces
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Slower lookups
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Robust design
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Efficient storage use
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Data integrity problems
Explanation
Correct Answer D. Data integrity problems
Explanation:
Data redundancy occurs when the same piece of data is stored in multiple places within a database. This can lead to data integrity problems, such as inconsistencies or errors, if the redundant data is not updated simultaneously across all locations. For example, if a customer's address is stored in two different tables and only one is updated, it can create confusion and inaccuracies.
Why Other Options Are Wrong:
A. Slower lookups
This option is incorrect because slower lookups are not directly caused by data redundancy. Lookup speed is more influenced by database indexing and query optimization.
B. Robust design
This option is incorrect because data redundancy does not contribute to a robust design. In fact, it often complicates database management and increases the risk of errors.
C. Efficient storage use
This option is incorrect because data redundancy does not lead to efficient storage use. Redundant data consumes additional storage space, making storage less efficient.
Accounting information system components include
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Input data
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Hardware
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Software
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People
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All of these
Explanation
Correct Answer E. All of these
Explanation:
Accounting information systems (AIS) consist of several key components, including input data (raw financial data), hardware (computers and devices), software (applications for processing data), and people (users and professionals who operate the system). All these components work together to ensure the system functions effectively.
Why Other Options Are Wrong:
A. Input data
This option is incomplete because while input data is a component of AIS, it is not the only one. Hardware, software, and people are also essential.
B. Hardware
This option is incomplete because hardware alone cannot function without input data, software, and people.
C. Software
This option is incomplete because software requires input data, hardware, and people to operate effectively.
D. People
This option is incomplete because people need input data, hardware, and software to perform their roles in the system.
What is a primary function of database management within an accounting information system
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Ensuring data integrity and security
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Creating marketing strategies
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Conducting financial audits
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Managing human resources
Explanation
Correct Answer A. Ensuring data integrity and security
Explanation:
A primary function of database management within an accounting information system is to ensure data integrity and security. This involves maintaining accurate, consistent, and reliable data while protecting it from unauthorized access, breaches, or corruption.
Why Other Options Are Wrong:
B. Creating marketing strategies
This option is incorrect because creating marketing strategies is not a function of database management. Marketing strategies are developed by marketing teams using data analysis tools.
C. Conducting financial audits
This option is incorrect because conducting financial audits is the responsibility of auditors, not database management systems. Databases may store the data used in audits, but they do not conduct the audits themselves.
D. Managing human resources
This option is incorrect because managing human resources is the role of human resource management systems, not database management systems.
What is the final step in the data processing cycle
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Output
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Storage
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Processing
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Input
Explanation
Correct Answer A. Output
Explanation
The data processing cycle consists of four main stages: input, processing, storage, and output. The final step, output, involves presenting the processed data in a useful format, such as reports, charts, or summaries, for decision-making.
Why other options are wrong
B. Storage. – Storage is an intermediate step where data is saved for future use but is not the final step in the cycle.
C. Processing. – Processing transforms input data into meaningful information but is not the last step.
D. Input. – Input is the first step, where raw data is collected and entered into the system.
One of the primary functions of accounting is
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Communicate information to decision makers
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Provide information to taxing authorities
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Increase a company's profitability
Explanation
Correct Answer A. Communicate information to decision makers
Explanation:
One of the primary functions of accounting is to communicate financial information to decision makers, such as managers, investors, and creditors. This information helps stakeholders make informed decisions about the organization's operations, investments, and financial health.
Why Other Options Are Wrong:
B. Provide information to taxing authorities
This option is incorrect because while accounting provides information to taxing authorities, this is not its primary function. The main focus is on supporting internal and external decision-making.
C. Increase a company's profitability
This option is incorrect because accounting does not directly increase a company's profitability. It provides data and insights that can inform strategies to improve profitability, but it is not a profit-generating function.
The term "accounting independence" refers to
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Data integrity
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Separation of duties such as record keeping and custody of physical resources
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Generation of accurate and precise information
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None of the above
Explanation
Correct Answer B. Separation of duties such as record keeping and custody of physical resources
Explanation:
Accounting independence refers to the separation of duties, such as record keeping and custody of physical resources, to prevent fraud and errors. This ensures that no single individual has control over all aspects of a financial transaction, enhancing accountability and reliability.
Why Other Options Are Wrong:
A. Data integrity
This option is incorrect because data integrity refers to the accuracy and consistency of data, not the separation of duties.
C. Generation of accurate and precise information
This option is incorrect because the generation of accurate and precise information is a result of good accounting practices, not the definition of accounting independence.
D. None of the above
This option is incorrect because accounting independence is specifically about the separation of duties, making this choice invalid.
What is the role of accounting information systems
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To make the bookkeeper's job easier.
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To prepare the worksheet.
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To organize financial data.
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To automate invoicing.
Explanation
Correct Answer C. To organize financial data.
Explanation
The primary function of an accounting information system (AIS) is to collect, process, and store financial data in an organized manner. This system ensures that financial information is accurate, accessible, and useful for decision-making and reporting.
Why other options are wrong
A. To make the bookkeeper's job easier. – While an AIS may help bookkeepers, its primary role is broader, focusing on financial data organization and analysis.
B. To prepare the worksheet. – Worksheets are part of accounting, but an AIS is a comprehensive system that does much more than worksheet preparation.
D. To automate invoicing. – Although invoicing can be automated using an AIS, its primary function is data organization rather than just automating specific tasks.
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BUIT 3000 C724 Information Systems Management
1. Introduction to Information Systems Management
Definition and Importance
Information Systems Management (ISM) refers to the practice of managing the implementation, maintenance, and optimization of information systems within an organization. These systems are crucial for collecting, processing, storing, and disseminating information necessary for decision-making and operational efficiency.
Importance:
- Efficiency: Automates routine tasks, reducing manual effort and errors.
- Decision-Making: Provides accurate and timely data for strategic decisions.
- Competitive Advantage: Enables organizations to innovate and stay ahead of competitors.
Key Components of Information Systems
- Hardware: Physical devices like computers, servers, and networking equipment.
- Software: Applications and operating systems that process data.
- Data: Raw facts and figures that are processed to generate information.
- Procedures: Guidelines and rules for using the information system.
- People: Users and IT professionals who interact with the system.
Role of Information Systems in Organizations
- Operational Support: Streamlines day-to-day operations.
- Managerial Support: Assists in planning, controlling, and decision-making.
- Strategic Support: Helps in long-term planning and gaining a competitive edge.
2. Types of Information Systems
Transaction Processing Systems (TPS)
- Purpose: Handles routine transactions such as sales, orders, and payments.
- Example: A point-of-sale (POS) system in a retail store.
Management Information Systems (MIS)
- Purpose: Provides reports and data analysis to support middle management.
- Example: A sales report generated weekly to track performance.
Decision Support Systems (DSS)
- Purpose: Assists in making complex decisions by analyzing data and providing models.
- Example: A system that predicts future sales based on historical data.
Executive Information Systems (EIS)
- Purpose: Provides summarized information for top executives to make strategic decisions.
- Example: A dashboard that shows key performance indicators (KPIs) for the entire organization.
Enterprise Resource Planning (ERP) Systems
- Purpose: Integrates all business processes into a single system.
- Example: SAP ERP system used by multinational corporations to manage finance, HR, and supply chain.
3. Strategic Role of Information Systems
Competitive Advantage
- Definition: Using information systems to gain an edge over competitors.
- Example: Amazon’s recommendation system personalizes the shopping experience, increasing customer loyalty.
Business Process Reengineering (BPR)
- Definition: Redesigning business processes to improve efficiency and effectiveness.
- Example: Ford Motor Company reengineered its accounts payable process, reducing headcount by 75%.
Knowledge Management Systems (KMS)
- Definition: Systems that capture, store, and distribute knowledge within an organization.
- Example: A company intranet that allows employees to share best practices and collaborate on projects.
4. Information Systems Development
System Development Life Cycle (SDLC)
- Phases: Planning, Analysis, Design, Implementation, and Maintenance.
- Example: A company developing a new customer relationship management (CRM) system follows these phases to ensure a successful rollout.
- Definition: An iterative approach to software development that emphasizes flexibility and customer feedback.
- Example: A software development team releases a basic version of an app, then iteratively adds features based on user feedback.
- Definition: Creating a preliminary model of the system to gather feedback before full-scale development.
- Example: A prototype of a new e-commerce website is tested with a small group of users before the final version is launched.
5. Managing Information Systems
IT Infrastructure and Emerging Technologies
- Components: Hardware, software, networks, and data centers.
- Emerging Technologies: Cloud computing, artificial intelligence, and blockchain.
- Example: A company migrates its data to the cloud to reduce costs and improve scalability.
Information Security and Risk Management
- Importance: Protects sensitive data from breaches and cyberattacks.
- Example: Implementing firewalls, encryption, and multi-factor authentication to secure customer data.
Ethical and Social Issues in Information Systems
- Concerns: Privacy, intellectual property, and digital divide.
- Example: A company faces backlash for using customer data without consent, highlighting the importance of ethical practices.
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