Theory of IT and Management

7/31/2019 Theory of IT and Management

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Theory of IT and ManagementManagement information

DataInformation

Purpose of management informationPlanningControl (feedback and feed forward control)

Decision-making.

Features of useful informationReliable, Timely, Relevant, Complete, Accurate, Clear, Cost effective

Management accountsDistributed internallyConcerned with past and futureUsed for planning control and decision makingIncludes of financial and non-financial information

Financial accountsUsed for external reporting

Legal requirement for limited companiesConcerned with past dataUsually includes of financial information

Reporting management informationAd hoc reporting, Regular reporting

Types of communicationWritten communication

- Letters- Memo- Reports- Email

- FaxOral communication

Face to face meetingTelecommunicationVideo conferencing

Responsibility accountingCost centre, Revenue centre, Profit centre, Investment centre

Miscellaneous termsArchiving

Active filesNon-active files

BackupTypes of processing

Batch processingOnline Processing

CentralisationDecentralisationPolicy manualBespoke softwareOff the shelf packagesVirusTerminals (dumb and intelligent)GUI (Graphical User Interface)Different types of Checks

Format checkRange checkLimit checkCheck digit verification

Prepared by:Zaira Anees Page 1


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Practice questions1. Which one of the following is controllable by the head of production department?

A. Price paid for materialB. Raw material usedC. Electricity bill ratesD. Wages paid to labour

2. Which one of the following is a best password?A. Robertson B. oct2008C. ZQ56 D. ZA5209A6

3. Which one of the following are incorrect regarding backup?i) Backup should be checked and updated on a regular basisii) Company should make backup of non-active filesiii) Backup should be made on the same PCiv) Grand-Father-Son is a concept used in backupA. i) and iv) onlyB. ii) and iii) onlyC. i) and iii) only

D. ii) and iv) only

4. You should except my offerAbove statement contain a mistake and the sentence should be like thisYou should accept my offerHow will you correct this mistake in a word document?

A. Spell checker C. Grammar checker

B. Proof reading D. Computer will automatically correct it

5. ACCA database holds information of students E-mail addresses is among one of them. E-mail is anexample of

A. File B. Record C. Field D. Database

6. A company wants to compare its own companys sales and its major competitors sales over a period of 5years. Which chart most suits this requirement?

A. Pie chart C. Multi bar chart

B. Simple bar chart D. Component bar chart

7. Assume that it is 9:00 am of 30th Nov and you have to call an urgent meeting on 31st Nov at 10:00 am. Howwill you inform the members of meeting?

A. Call C. E-mail

B. FAX D. Courier

8. Assume that it is 20th Dec; you want to tell your staff that the factory will remain close in last three days of

Dec. Which one of the following is the best method of communication?A. Notice board C. E-mail

B. FAX D. Personal meeting

9. A company is facing seasonal variation in sales, where last quarter and first quarter (Q1 and Q4) peakseasons and Q2 and Q3 are are down seasons. How you will compare performance of sales in Q4?

i) Budgeted sales and actual sales of Q4ii) Sales of last years Q4 with sales of current years Q4iii) Actual sales of current years sales of Q3 with sales of current years Q4iv) Actual sales of Q1 with Q4

Which statement is correct?

A. i) and ii) only C. iii) and iv) only

B. ii) and iii) only D. i) and iv) only

10. What you will write at the end of the official letter?

A. Yours truly C. Yours sincerely



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B. Yours faithfully D. Yours obediently

11. Which of the following statement is incorrect?i) In perpetual inventory system, stocks are updated on a regular basis after every transaction.ii) Bin card records only date, quantity and code of materialiii) Purchases department prepares material purchase requisition

A. i) and iii) only C. ii) and iii) only

B. i) only D. iii) only

12. Which of the following are incorrect about Data Protection Act?i) Data should be keptii) Data should not be passed to third partyiii) Data should be fairly obtained and shall be used for lawful purposeiv) It should always be kept up to date


B. i), iii) and iv) only D. ii) only

13. Which of the following statements are correct?i) Company archive different files because it is not used in futureii) Company archive different files in order to create capacity

iii) Company archive different files but they are also remained in the systemA. i) and iii) only C. ii) only

B. iii) only D. i) only

14. Performance Measurement of cost center can bei) analysed by comparing cost of current year with cost of last yearii) analysed by comparing profit of current year and last yeariii) analysed by comparing CPU of current year with cost per unit of last year


B. ii) only D. iii) only

15. the most common cause of incorrect data is

A.Virus C. Hacking

B. Hardware failure D. Human error

16. Quality of good informationA. Timely, reliable and presented manuallyB. Complete, accurate and as much detailed as possibleC. Clear, reliable and relevant for purposeD. Reliable, accurate and presented in graphs

17. Which one of the following is true?A. X-axis is always dependent and Y independentB. Y-axis is always dependent and X independentC. No matter

D. None of above

18. There are different checks which organisation uses to ensure safe and correct input of data. A checkwhich ensures that customers account number has been entered correctly or not is called

A. Range check C. Format check

B. Feasibility check D. Check digit verification

19. Which one of the following is/are not example of data?i) Collection of customers detailii) Report showing amount of sales in each regioniii) Bad debt analysisiv) Variance reportA. i) and iii) onlyB. i) onlyC. ii), iii) and iv) onlyD. i) and ii) only



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20. Which of the following are not examples of physical access control?Security guardEncryptionCard entry systemFirewallClose circuit cameras

A. i), ii) and v) onlyB. ii) and iv) onlyC. i), iii) and iv) onlyD. ii), iii) and iv) only

21. Under health and safety legislation, which one of the following are duties of employee?i) Follow guidelinesii) Co-operate with employeriii) Use all equipmentsiv) Inform employer about any dangerA. i), ii) and iv) onlyB. All of aboveC. None of aboveD. iii) only

22. Which of the following is example of external information?i) Consumer price index statisticsii) Variance reportiii) Income tax rateiv) Product cost

A. i) and iii) only B. ii) and iv) onlyC. i), iii) and iv) only D. iv) only

23. Which one of the following is not a disadvantage of integrated system?i. Data used to be input only one timeii. All users can access same dataiii. Same information cannot be available for all

iv. All department have same layoutv. No need of labour training

A. ii, iii and v only B. i, ii and iv onlyC. iii and v only D. iii and iv only

24. Which one of the following is/are feature of physical security?Closed circuit camerasPasswordsAudit trailsMechanism to check in and outEncryptionFirewall

To employ security guard to check identificationA. i, iii and vii B. iii, v and vi onlyC. ii, iii and v only D. i. iv and vii only

25. If information is confidential best should be delivered

A. by E-mail C. by telephone

B. personal meeting D. FAX

26. User-friendly systems can include a number of features. Which one of the following is not user-friendly?A. GUI B. WIMP C. Icons D. DOS

27. Which of the following is not among one of the health and safety requirements towards employer?i. To provide maintained equipment

ii. To give training to labouriii. To provide basic education facilityiv. To provide accommodation



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v. To provide protective clothing, if required

A. i. ii and v only B. iii and iv onlyC. ii, iv and v only D. i. iii and v only

28. If a person is working 8 hours per day on a computer system, which one of the following will be applied?To allow him regular tea breaksTo allow him regular but short breaksProvide RSI protected keyboards

Adjustable chairs to adjust his heightTo provide him few but long breaks

A. ii, iii and iv only B. iii, iv and v onlyC. i, iii and iv only D. ii, iv and v only

29. An organization has recently introduced a scanner and OCR software to 'digitize' information received onpaper. Which of the following is not a likely benefit of this?A. saving in staff costB. easier access to information as it is stored in a digital form.C. Quicker input processD. Reduced need to take back up

30. Which one of the following is not a service centre?Refining departmentMachining departmentStore departmentCanteen departmentFinishing department

A. i, ii and v only B. iii and iv onlyC. iii, iv and v D. all except ii and v

31. Which of the following is relevant in the calculation of prime cost of production?A. Supervisor's salaryB. Absorbed production overheadsC. Direct expense

D. Overtime premium paid due to machine breakdown

32. Which of the following is usually a function of the accounts department?i. payroll preparationii. negotiating prices and discounts from supplier iii. payments of supplier's invoicesiv. preparation of financial statements

A. i. and ii only C. iii and iv only

B. i. iii and iv only D. ii and iii only

33. Data processing can be divided into two main types batch processing and real time processing twostatements follows about real time processing

1. real time processing involves transactions being input and processed immediately

2. Travel agents, airlines and cinema and theater tickets agencies would use real time processing.

A. Statement 1 is correct only Statement 2 is correct only

B. Both statements are correct Both statements are incorrect

34. Which one of the following is not management accounting information?

A. Sales budget C. Variance report

B. Profitability report D. Bank statement

35. A section in a company policy manual contains the terms 'segregation of duties', 'job rotation' and 'need toknow'. What policy is this section MOST likely to be describing

A. staff recruitment procedure

B. staff appraisal and trainingC. responsibility accountingD. personnel security controls



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36. What will not be affected by telecommunication?A. office rent B. Phone billC. Travel time D. Conference time

37. Which of the following about policy manual is true?i. it helps to ensure that all personnel follow procedureii. it helps to ensure best practicesiii. all businesses are required by law to keep policy manuals for all employeesA. Statement i. and ii onlyB. Statement ii, and iii onlyC. Statement i. and iii onlyD. All of above

38. Which one of the following is not a function of the purchasing department?A. Ensuring that only required goods are purchasedB. Ensuring that suppliers used give that best pricesC. Negotiating discounts with suppliersD. Paying supplier's invoices

39. Which one of the following is not considered as an advantage of e-mail?A. secure method of communication

B. speedy deliveryC. stores messages for a given period after they are received.D. Can make a single message available to many persons

40. Which one of the following statement is incorrect? A Local Area Network (LAN)A. relies on telephone lines to link togetherB. Is incapable of extensive geographical dispersionC. is likely to contain a central server computer.D. None of above

41. Which one of the following statement is incorrect?A.A help function is often a feature of a user friendly programB.A mouse driven program can use both keyboard and mouse as input devices.

C. Function keys on keyboard enables the users to enter instructions quickly to the computer, in order to carryout defined operations with an application programs.D. Icons are normally used on systems that do not need a mouse for computer.

42. A spreadsheet software application may perform all of the following business tasks except one. Whichone of the following is the exception?A. The presentation of numerical data in the form of graphics and chartsB. The application of logic test to dataC. The application of what if scenariosD.Automatic correction of all data entered by the operation into the spreadsheet.

43. Modern offices are often described as processing towards the paperless office. Which of thefollowing technologies is least likely to support this?

A. Electronic data change B. Document image processingC. Electronic mail D. the Facsimile (FAX)

44. Hacking is a crime. Which of the following best describe hacking?Changing data on disk c. Unauthorised access to a computer systemPassing on a computer virus d. None of above

45. Which of the following best describes a profit centre?A Part of a business where management makes investment decisionsB Part of a business that provides a service to other parts of the business

C Part of a business where finished products are manufacturedD Part of a business where management is responsible for revenues and costs



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46. Spelling and grammar checking is a feature of a word processing package. Which one of thefollowing is not a spelling or grammar checking test?A. checking that all full stops are followed by at least one space.B. Highlighting incorrectly spelt words and suggesting corrections.C. Highlighting very long sentences.D. checking all values in tables add up correctly.

47. Which of the following are reasons to buy an off-the-shelf inventory control software package?(1) The package will require significant tailoring(2) The package is available now and ready for use(3) The package will be available to the organisations competitors(4) The package will have been tested by other users2 only b) 1 and 3c) 2 and 4 d) 3 and 4

48. In a large company, which of the following activities may be the responsibility of an accountingtechnician?A Calculating cost variances B Making capital investment decisionsCApproving budgets DAllocating warehouse space

49. What is an interlocking bookkeeping system?

AA single, combined system containing both cost accounting and financial accounting recordsBA system combining cost accounting and management accountingCA system supported by prime entry recordsDA system where separate accounts are kept for cost accounting and for financial accounting.

50.Computer systems are extremely useful for processing accounting information. Which of thefollowing is not an advantage of computerised accounting system compared to a manual system?A. Its easy to find where mistakes have been made.B. Double entry is automatic.C. Data can be analysed quicker.D. Less training is required to use computer system.

51. Which of the following are characteristics of management accounting information?

(i) Non-financial as well as financial(ii) Used by all stakeholders(iii) Concerned with cost control only(iv) Not legally requiredA (i) and (iv) B (ii) and (iii)C (i), (ii) and (iii) D (ii), (iii) and (iv)

52. Which of the following only contains essential features of useful management information?AAccurate, clear, presented in report format B Timely, reliable, supported by calculationsC Regular, complete, communicated in writing D Clear, accurate, relevant for its purpose

53. Which one of the following item of information would be least essential to gather when signing in avisitor?

A. The visitors name. B. The person or department being visited.C. Time of arrival and leaving. D. The purpose of the visit.

54. Which of the following statements about cost and management accounting are true?1. Cost accounting cannot be used to provide inventory valuations for external financial reporting2. There is a legal requirement to prepare management accounts3. The format of management accounts may vary from one business to another4. Management accounting provides information to help management make business decisionsA 1 and 2 B 1 and 4C 2 and 3 D 3 and 4

55. Consider the following statements relating to process costing:Statement 1: Many files combine to make a record.

Statement 2: Many fields combine to make a record.Statement 3: Many records combine to make a file.Statement 4: Many records combine to make a database.Which statement(s) is/are false?



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A 1, 2 and 3 B 1 and 4 onlyC 2 and 3 only D 1 and 2 only

56. What is the purpose of management information?A Planning onlyB Planning and control onlyC Planning, control and decision-making onlyD Planning, control, decision-making and research and development

57. The following statements relate to spreadsheets:(i) A spreadsheet is the most suitable software for the storage of large amounts of data.(ii) A spreadsheet consists of rows, columns and cells.(iii) A forecast profit and loss account could be prepared using a spreadsheet.Which of the statements are correct?A (i) and (ii) only B (i) and (iii) onlyC (ii) and (iii) only D (i), (ii) and (iii)

58. For which of the following would a production line manager of a manufacturing company beresponsible?A. Labour rates and raw material prices.B. Labour hours worked and raw material prices.

C. Labour rates and raw material usage.D. Labour hours worked and raw material usage.

59. Which three of the following are usually considered to be profit centres?i) A brandii) A service department in a factory, such as maintenanceiii) A machinery in a factory.iv) A division of a companyv) A product

A. i, iv and vB. i, ii and iiiC. ii, iii and ivD. i, ii and v

60. Features of computer systems include:(i) icons(ii) keyboard(iii) optical mark reading(iv) pull-down menuWhich of the above are features of graphical user interfaces?A (i) and (iv) B (ii) and (iii)C (i), (iii) and (iv) D (i), (ii) and (iv)

61. Which one of the following is not applications software?A Database softwareB Word-processing software

C Software which gives priority to different programs during processingD Software designed in-house to perform a particular task for a particular user.

62. A smart card is:A A plastic card with machine-sensible data recorded on magnetic stripeB A plastic card with machine-sensible data recorded on a microchipC A credit card with a security hologramD A hand-held device used to scan text

63. The system operated at many businesses whereby a customers bank account is debited with the price ofgoods purchased at the time of the sale is known as:

A EFTPOS C. POSB EPOS D. EFT



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64. Modem is derived from two words. They are:

A Modern demographics C. Modulate demodulate

B Modular demonstration D. Model manager

65. Which of the following is a device for converting digital signals to analogue signals and then back again?

A Transformer C. Modem

B Packet Switcher D. Interpreter

66. Which of the following input technologies uses a stylized font in banking applications?

OMR C. OCR

MICR D. BACS

67. Bits and bytes are terms used to describe the size of computer memory and storage. Which of thefollowing statements is true?

A A bit is larger than a byte C. A byte is larger than a bit

B A byte is the same size as a bit D. A bit may be larger or smaller than a byte

68. Which of the following is not considered an advantage of E-mail?Secure method of communicationSpeedy delivery

Stores messages for a given period after they are receivedCan makes a single message available to many persons

69. Which of the following is not a typical function of an operating system?A BootingB Translating a program from one language to anotherC Managing multi-taskingD File management

70. Which one of the following statements relating to the internet is false?A. Some of the information available on the internet is poor qualityB. All business communicate via internet is secured by the standards developed by Electronic DataInterchange (EDI) communication system.

C. Some of the information on the internet is high qualityD. Many businesses now include a website on the internet as an element in their marketing mix.

71. The screen print below shows the Print options from a Windows application.What does the field description Name have the letter N underlined?

A To emphasis the need for the user to check the name of the printer before printing.B To allow the user to select the Name function using the ALT and N keys.C To indicate that the printer name field is mandatory and hence should contain an entryD To indicate that the printer name field has a pull-down list of valid entries.

72. The following formula is contained in a spreadsheet cell B5.=ROUNDUP (B4, 0)If the value in B4 is 2.36, what is the value in B5?A. 3 B. 2.5

2.4 D. 0

73. With reference to the following screen, the user wished to return to the page they viewed before this one.What command would they use?

A Back C. Refresh

B History D. Search

74. In the following the word Home is underlined (shown at the end of the large arrow.)Why is the word Home underlined?

A To indicate how important the Home page is to the userB To allow the user to select the Home function using the ALT and H keys



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C To allow the user to select this option through the Home page key on the keyboardD To indicate that it is a hypertext link to the Home page of the Internet site

75. Which of the following is responsible for the implementation of the Data Protection Act?

A Comptroller & Auditor General C. Audit commission

B Data Protection Registrar D. Department of Trade & Industry

76. The consequences of the activities of hackers can be very serious for an organisation. One from the list

below is not a risk associated with hacking. Which one is it?A Generate information which is of potential use to a computerB Provide the basis for fraudulent activityC Alter or delete the filesD Steal computer hardware

77. An organisation has a large customer data file stored on its computer system. The size of this file is one ofthe factors causing the computer systems in the organisation to perform inefficiently. A consultant has pointedout that almost half of the customers on the file have not ordered for five years and suggests that informationabout such customers should be moved to magnetic tapes for ling-term storage.Which of the following is this an example of:

A Backing-up C. Archiving

B Dumping D. Defragmenting

78. Why should some computer back-ups be stored off-site?A To save office spaceB To enable working at homeC To conform with the procedures manualD To ensure a back-up is available should the office be damaged or destroyed

79. Which one of the following security options is unlikely to be feasible for most businesses?

A Iris scanning C. After hours security guard

B Swipe card access D. Door access combination code

80. Which of the statements about password is true?

A If you have a password you know you wont forget, you should never change itB You should change your password everydayC Your password should be easy for you to remember, but difficult for anyone else to guessD You should make a note of your password and keep this in your desk drawer

81. The most common cause of incorrect data in computer system is:

A Hacking C. Viruses

B Hardware failure D. Human error

82. What is relationship between z data and information?A Processed data is called informationB Data are raw materials for data processingC Data are facts and figures are not apparently meaningfulD All of the above

83. Comparison between actual and budgeted costs will help the management in which of the followingareas?

A Control C. Planning

B Implementing D. Decision making

84. Management compares the planned performance with the actual one in order to determine cause ofdeviation and to take corrective measure.The above-mentioned function of management is called?

A Checking planB Variance analysis and control

C Comparison measureD None of the above

85. Which of the following would be data rather than information?A Increase/Decrease per product in the sales in last quarter



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B Total sales value per productC Salesmans commission as a percentage of total salesD Sales made per salesman as a percentage of total sales

86. Which of the following about management information is false?(i) It includes both financial and non-financial reporting(ii) It is used for both internal and external reporting(iii) It considers only the past data

Statements (I) and (iii) onlyStatement (ii) and (iii) onlyStatement 2 onlyAll 3 statements are false

87. The coding of a product is done in the following format:Product/type of expense/departmentThe following info is given:Wages 012Salaries 013Product A 514Product B 513Dept. C 214

Dept. D 213How will the wages relating to product A an in department C be coded?A. 012-514-214 B. 514-012-214C. 214-514-012 D. 514-214-012

88. Which of the following about management information is false?A. Prices changes should be considered while working on management informationB. Information should not have any accountancy jargonC. Information should be reliable, timely and accurateD. The costs of producing the information should be greater than the benefits

89. Which of the following is NOT a purpose of management info in a company?A To provide records of current and actual performance

B To compare actual performance with planned performanceC To help management with decision makingD To inform customers about the companys products

90. Which of the following is always a quality of good information?

A Immediate availability C. Availability to everyone

B Reliable D. Technically accurate

91. Which of the following statements is incorrect?A Management accounting reports are more accurate than financial accounting statementsB Management accounting reports are more detailed than financial accounting statementsC Management accounting reports are more frequent than financial accounting statementsD Management accounting reports are not disclosed to shareholders and investors

92. Which of the following are ALL qualities of good management information?

A Digital, brief, relevant C. Reliable, consistent, timely

B Secure, accurate, printed D. Accessible, universal, complete

93. Which of the following statements is correct?A Data is held on computer in digital form whereas information is in a form that is readable to human

beingsB Information is obtained by processing dataC Data and information mean exactly the same thingD Data consists of numerical items only

94. Which of the following is true about ad-hoc reports?



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(i) An ad hoc report is generated only once or occasionally(ii) An ad hoc report has a house style(iii) The format and contents of an ad hoc report vary according to requirements

A Statement 1 onlyB Statements 1 and 3 onlyC statements 2 and 3 onlyD all the statements are correct

95. How does information differs from data?A Information is quantitative but data is qualitativeB Data is information in a meaningful contextC Data is quantitative but information is qualitativeD Information is data in a meaningful context

Check whetherTRUE orFALSE1. 1 byte is equals to 8 bits

2. Financial accountant decides what product to continue and what to stop.

3. An ad hoc report must follow standard format

4. icon is used to align text from left

5. I has been underlined so as to tell user which key he should be used with Alt.6. Tape streamers are only used to back-up all the files on a computer system in case of asystem failure

7. Grandfather, father, son is a concept used in archiving.

8. Tax rates are announced by tax authorities and are example of external information

9. An exception reporting means Report only those variances that exceeds acceptablelimits

10. If selling price variance is favourable then this means actual selling price is less thanstandard.

11. 1024 bytes is equal to one kilobyte

12. 1024 GB is equal to one MB

13. One of the benefits of using client server system is to share different information withoutgoing to other persons desk

14. Intranet is same as internet

15. Shared data, shared peripherals and quick way of communication all are the advantageof client server system.

16. Advantage of client server system also includes accurate and secure data.

17. GUI stands for Graphical User Interface and it is the way of communicating data by using

different commands

18. By using user friendly software, company can reduce training cost.

19. Monitor (or VDUs) can be used as input and output device

20. Management information accounting information consists of financial information butfinancial accounting information consists of financial and non financial information both.

21. Management accounting information is legally requirement.

22. Scanner is one of the output devices.

23. One of the risks of using email is that it is not a secure way of communication.

24. In context of email, bcc stands for bold carbon copy

25. http stands for hyper text transfer protocol

26. =add(A1:A5) will add automatically cells from A1 to A5

27. Bit is greater than byte

28. CD and DVD both are examples of permanent storage.

29. Spreadsheets allow user to draw different graphs.

30. Apportionment means distribution of costs over two or more cost centres.31. mega byte is less than kilobyte32. case sensitive passwords can be used to make a simple password difficult to guess33. Management should take actions against those variances which are adverse.



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34. Information related to sales volume is considered as external information for production1. department at the time of budgeting.

35. Archiving is a copy of computer file kept separately from main system in order to be used

if original file get corrupted36. Mnemonic related to quality of good information is accurate

37. Mnemonic accurate stands for accurate, complete, cost beneficial , User targeted,

relevant, authoritative, timely, easy to use38. The difference between letter and memo is that letter is formal and memo is informal

39. Within the context of data protection act, data users are individuals or organization whichuses the data.40. Bar charts are usually used to show trends41. policy manual can include policies relates to purchase of material and choosing suppliers

42. If management has to choose between different alternatives, then this will be an example

of decision making.43. If material cost variance is adverse then it might be because of use of low graded labour.44. Policy manual can also include policies related the verification process of customer.

45. If different files have been integrated then this means that changing telephone number of

supplier at one place will automatically change telephone number in other files.46. Performance of investment centre can be measured by ROCE and RI.

47. Performance of cost centre can be measured by comparing actual cost per unit of current

year with budgeted cost per unit of last year48. Fixed cost and semi variable cost per unit increases when production volume decreases.49. Financial accounts are legally required but management accounts are not.50. Management accounts are related with past as well as future.51. Ad- hoc reports are regular reports issued by management.52. Letter, e-mail, video conferencing all are examples of written communication.53. One of the limitations of management accounting is that it is financial as well as non-financial.54. Archiving is used to free up storage space.55. Company make backup to retain that data which is required to fulfill legal obligations.

56. A cost book keeping system in which cost accounting transactions and financial

accounting transactions are recorded is known as integrated system.57. Management information helps management in planning, controlling and decision

making.58. Routine information is useful for long term decisions.59. Management accounting reports are more detailed as compared with financial reports.60. Current bank balances and supplier statements are kept by management accountant.61. Complexity of information is not a part of useful information.62. Bank interest rate, loan repayment schedule and dividend all are included in costaccounting.63. Generally dispatch of customer orders is the responsibility of accounts department.64. Report showing variances and its analysis is an example of information.

65. Management accounting information is provided throughout the year, whereas financial

reporting is only at specific times of year.

66. Management accounting information is for external stakeholders and financial accounting

information is for internal stakeholders.67. Total number of employees is example of data and detail of employees about their

classification and department to which they relate is an example of information.68. Decision whether to diversify or not is an example of strategic decision making.

69. Decision whether to allow labour for overtime or not will be an example of tactical

decision making.70. Credit ratings issued by different credit rating agencies are an example of secondarydata.71. Managers should only be responsible for controllable costs in their decisions.72. Encryption is the process used to protect data while transmission through email.73. Passwords are used to protect data from unauthorised access.74. Different products, brands and divisions can be example of profit centers.75. If labour cost variance is favourable then it might be because of use of experienced

labour.76. If material cost variance is adverse then it might be because of purchase of low pricematerial.77. Production department, store and maintenance all are examples of investment centers.



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78. A manager is responsible for costs and revenue for his part of the business. He is also

responsible for the type of machines which should be bought and used in his factory. He is manager ofinvestment centre.

79. Reserve inventory means finished inventory that has been reserved for specific customer

and will not be dispatched to anyone other than that customer.80. Only active files are archived.81. Backup is a procedure used to keep data up to date.

82. Letter is used for internal communication and memo (or memorandum) is used for

external communication.83. E-mail is faster and most secure method of communication.84. Total cost when divided with total number of units will give cost per unit.

85. Performance can also be measured by comparing actual information of current year with

similar company of same industry86. flexible budget allow to calculate cost at different activity levels87. B1-B50 in spreadsheet represents column88. A1-K1 represents row in spreadsheet.89. Asset turnover ratio is calculated by dividing profit with capital employed.

90. Case sensitive password is the use of capital and small letters to make password more

difficult to guess.91. Data used in word processing software comprises of text, numbers and formulae.

92. Personal data shall be accurate and shall be updated every year93. Information on timesheets used for making up wages is an example of primary data94. Managers are responsible for controllable as well as uncontrollable variances.

95. Information from trade publication used to choose a supplier of raw material is an

example of secondary data96. Accounts department should pay for invoices after matching it with delivery note andinvoice.97. If labour cost variance is adverse then it might be because of use of cheap quality ofmaterial.

98. Recruitment and induction of new staff should be done by personnel department

99. A document issued by purchasing department, sent to the supplier requesting material is called

purchase requisition100. Performance of cost centre can be measured by gross profit %.

101. A store ledger account shows only the quantity of stock held102. A document received together with materials and matched with purchase order at the time of payment

is called invoice.

103. A document prepared by store department on receipt of raw material, sent to the purchasing

department to confirm delivery is material requisition note104. values on X axis are dependant on values shown on Y axis

105. A document issued by production department and sent to the stores department requesting materials is

called material purchase requisition106. Back up can be used to aid management in case information in original system gets lost.107. Performance of profit centre can be measured by operating profit%.108. Backup should be made on the same PC109. Company archive different files but they are also remained in the system.

110. Performance Measurement of cost center can be analysed by comparing cost of current year with costof last year

111. Information on from a government publication concerning forecast rated used for budgeting is an

example of primary data

112. under data protection act, an employee is allowed to access to all of his personal data held by an

employer

113. Under data protection act, an employee can sue an employer for distress caused due to his personal

data being factually incorrect.

114. Management carryout variance analysis at the end of the year. This is an example of decision making

115. feedforward control takes place before a variance is reported116. Management makes budget at the starting of the year. This is an example of planning.117. Performance of cost centre can be measured by cost per unit

118. Performance of investment centre can be measured by comparing ROCE of current year with ROCE oflast year

119. if selling price increase then contribution will decrease120. Financial accounting is concerned with future results as well as historical information



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121. If management of a company wants to send information to head office overseas then it should e-mail it

rather than sending it via courier.122. A bin card shows the quantity and value of stock held123. if fixed cost will increases then breakeven point will decrease124. if fixed cost decreases then margin of safety will increase125. If information is confidential, then you must not discuss its contents with anyone.126. DOS means disk operating system and it controls basic computer operations.127. Personal data shall be obtained only for specified and lawful purpose and

128. Graphs and diagrams are a better way of communication then report containing paragraphs ofinformation representing same thing

129. Information should be relevant to the purpose and should not be excessive from its purpose.130. values on Y axis are dependant on values shown on X axis

131. RAM stands for random access memory which is of volatile nature and anyone switches off computer

then it will be lost.132. Reporting by exception means that reporting of only those variances which exceed a2. predefined limit.133. if variable cost decreases then breakeven point will also decrease134. Allocation means assign a whole item of costs to a centre account.

135. Absorption of overheads means process by which overheads are included in the costs of cost units.

136. Feedback and feed forward control are concerned only with uncontrollable variances137. Email can be used by purchase department if it wants to ask for the price of specific material.138. If material cost variance is adverse then it might be because of efficient use of material.139. clock cards are used by companies to record labour hours140. Variance is an example of feedback control as well as feed forward control.141. Stores personal should prepare sales document

142. Performance of profit centre can also be measured by comparing operating profit % of current year with

budget of current year.

143. Job cards are used by the companies to record details of employees output when they are working in

different jobs.

144. Management accounting will be total figures for the whole organization, whereas financial reporting

information will be split into operational units.145. Preparation of financial accounts is a legal requirement.

146. Memorandum includes data, name of recipient, name of person issuing the memo, and subject for it is

written.147. Read only file means a file in which cannot be modified148. Feedback control takes place after a variance is reported;149. If material cost variance is adverse then it might be because of use of experienced labour.150. batch processing involves transactions being input and processed immediately

End of practice session


Documents

Theory of IT and Management