AccountinghInformationhSystems
Instructor’sSolutions Manual
h h
Accounting Information h
Systems
15th Edition h
Marshall B. Romney h h
Professor Emeritus, Brigham Young University
h h h h
Paul John Steinbart
h h
Professor Emeritus, Arizona State University
h h h h
Scott L. Summers
h h
Brigham Young University
h h
David A. Wood h h
Brigham Young University
h h
3-1
Copyrighth(c)h2021hPearsonhEducation,hInc.
, AccountinghInformationhSystems
ThishworkhishprotectedhbyhUnitedhStateshcopyrighthlawshandhishprovidedhsole
lyhforhthehusehofhinstructorshinhteachinghtheirhcourseshandhassessinghstudent
hlearning.h Disseminationhorhsalehofhanyhparthofhthishworkh(includinghonhthehW
orldhWidehWeb)hwillhdestroyhthehintegrityhofhthehworkhandhishnothpermitted.
Thehworkhandhmaterialshfromhithshouldhneverhbehmadehavailablehtoh
studentshexcepthbyhinstructorshusinghthehaccompanyinghtexthinhtheirhclasses
.
Allhrecipientshofhthishworkharehexpectedhtohabidehbyhthesehrestricti
onshandhtohhonorhthehintendedhpedagogicalhpurposeshandhthehneedshofhother
hinstructorshwhohrelyhonhthesehmaterials.
Copyrighth©h2021hbyhPearsonhEducation,hInc.horhitshaffiliates.hAllhRightshReserved.hManufacturedh
inhthehUnitedhStateshofhAmerica.hThishpublicationhishprotectedhbyhcopyright,handhpermissionhshould
hbehobtainedhfromhthehpublisherhpriorhtohanyhprohibitedhreproduction,hstoragehinhahretrievalhsystem,h
orhtransmissionhinhanyhformhorhbyhanyhmeans,helectronic,hmechanical,hphotocopying,hrecording,horh
otherwise.hForhinformationhregardinghpermissions,hrequesthforms,handhthehappropriatehcontactshwit
hinhthehPearsonhEducationhGlobalhRightshandhPermissionshdepartment,hpleasehvisithwww.pearsone
d.com/permissions/.
PEARSON,hALWAYShLEARNING,handhREVELharehexclusivehtrademarkshownedhbyhPearsonhEd
ucation,hInc.horhitshaffiliateshinhthehU.S.hand/orhotherhcountries.
Unlesshotherwisehindicatedhherein,hanyhthird-
partyhtrademarks,hlogos,horhiconshthathmayhappearhinhthishworkharehthehpropertyhofhtheirhrespectiveho
wners,handhanyhreferenceshtohthird-
partyhtrademarks,hlogos,hicons,horhotherhtradehdressharehforhdemonstrativehorhdescriptivehpurposesho
nly.hSuchhreferencesharehnothintendedhtohimplyhanyhsponsorship,hendorsement,hauthorization,horhpr
omotionhofhPearson’shproductshbyhthehownershofhsuchhmarks,horhanyhrelationshiphbetweenhthehown
erhandhPearsonhEducation,hInc.,horhitshaffiliates,hauthors,hlicensees,horhdistributors.
3-2
Copyrighth(c)h2021hPearsonhEducation,hInc.
, AccountinghInformationhSystems
chapter 1 h
accounting information systems:
h h h
An overview
h
SuggestedhAnswershtohDiscussionhQuestions
1.1 Thehvaluehofhinformationhishthehdifferencehbetweenhthehbenef
itshrealizedhfromhusinghthathinformationhandhthehcostshofhpr
oducinghit.h Wouldhyou,horhanyhorganization,heverhproducehin
formationhifhitshexpectedhcostshexceededhitshbenefits?h Ifhs
o,hprovidehsomehexamples.h Ifhnot,hwhy?
Mosthorganizationshproducehinformationhonlyhifhitshvaluehexce
edshitshcost.h However,hthereharehtwohsituationshwherehinform
ationhmayhbehproducedhevenhifhitshcosthexceedshitshvalue.
a. Ithishoftenhdifficulthtohestimatehaccuratelyhthehvalueho
fhinformationhandhthehcosthofhproducinghit.hTherefore,ho
rganizationshmayhproducehinformationhthaththeyhexpecthw
illhproducehbenefitshinhexcesshofhitshcosts,honlyhtohbehd
isappointedhafterhthehfact.
b. Productionhofhthehinformationhmayhbehmandatedhbyheitherh
ahgovernmenthagencyhorhahprivatehorganization.h Example
shincludehthehtaxhreportshrequiredhbyhthehIRShandhdisclos
urehrequirementshforhfinancialhreporting.
1.2 CanhthehcharacteristicshofhusefulhinformationhlistedhinhTab
leh1-
1hbehmethsimultaneously?h Orhdoeshachievinghonehmeanhsacrifi
cinghanother?
SeveralhofhthehcriteriahinhTableh1.1hcanhbehmethsimultaneousl
y.h Forhexample,hmorehtimelyhinformationhis
3-3
Copyrighth(c)h2021hPearsonhEducation,hInc.
, AccountinghInformationhSystems
alsohlikelyhtohbehmorehrelevant.h Verifiablehinformationhishli
kelyhtohbehmorehaccurate.
However,hachievinghonehobjectivehmayhrequirehsacrificinghano
ther.h Forhexample,hensuringhthathinformationhishmorehcomplet
ehmayhreducehitshtimeliness.h Similarly,hincreasedhverifiabi
lityhandhaccuracyhmayhreducehitshtimeliness.
Thehdecisionhmakerhmusthdecidehwhichhtrade-
offsharehwarrantedhinheachhsituation.
1.3 Youhandhahfewhofhyourhclassmateshdecidedhtohbecomehentrepren
eurs.h Youhcamehuphwithhahgreathideahforhahnewhmobilehphonehapp
licationhthathyouhthinkhwillhmakehlotshofhmoney.h Yourhbusine
sshplanhwonhsecondhplacehinhahlocalhcompetition,handhyouharehu
singhtheh$10,000hprizehtohsupporthyourselveshashyouhstarthyo
urhcompany.
a. Identifyhthehkeyhdecisionshyouhneedhtohmakehtohbehsuccessf
ulhentrepreneurs,hthehinformationhyouhneedhtohmakehthem,ha
ndhthehbusinesshprocesseshyouhwillhneedhtohengagehin.
b. Yourhcompanyhwillhneedhtohexchangehinformationhwithhvar
ioushexternalhparties.h Identifyhthehexternalhparties,h
andhspecifyhthehinformationhreceivedhfromhandhsenthtohea
chhofhthem.
Thehauthorhturnshthishquestionhintohanhin-
classhgrouphactivity.h Studentsharehdividedhuphinhgroups,h
toldhtohclosehtheirhbooks,handhgivenh15hminuteshto:
a. Thinkhthroughhthehbusinesshprocesses,hkeyhdecisions,hand
hinformationhneedshissueshinhtheirhgroup.
b. Identifyhthehexternalhusershofhinformationhandhspecif
yhthehinformationhreceivedhfromhandhsenthtoheachhofhthe
m.
Onehgrouphishselectedhtohpresenththeirhanswershtohthehclass.h
Thehotherhgroupsharehtoldhtohchallengehthehgroup’shanswers,hp
rovidehalternativehanswers,handhchiphinhwithhadditionalhansw
ershnothprovidedhbyhthehselectedhgroup.h Sincehthehgrouphthath
presentshishnothselectedhuntilhafterhthehtimehhashexpired,hstu
dentsharehmotivatedhtohdohahgoodhjob,hashtheyhwillhbehpresentin
ghtohtheirhpeers.
Thehvaluehofhthishactivityhishnothinharrivinghatha
3-4
Copyrighth(c)h2021hPearsonhEducation,hInc.
Instructor’sSolutions Manual
h h
Accounting Information h
Systems
15th Edition h
Marshall B. Romney h h
Professor Emeritus, Brigham Young University
h h h h
Paul John Steinbart
h h
Professor Emeritus, Arizona State University
h h h h
Scott L. Summers
h h
Brigham Young University
h h
David A. Wood h h
Brigham Young University
h h
3-1
Copyrighth(c)h2021hPearsonhEducation,hInc.
, AccountinghInformationhSystems
ThishworkhishprotectedhbyhUnitedhStateshcopyrighthlawshandhishprovidedhsole
lyhforhthehusehofhinstructorshinhteachinghtheirhcourseshandhassessinghstudent
hlearning.h Disseminationhorhsalehofhanyhparthofhthishworkh(includinghonhthehW
orldhWidehWeb)hwillhdestroyhthehintegrityhofhthehworkhandhishnothpermitted.
Thehworkhandhmaterialshfromhithshouldhneverhbehmadehavailablehtoh
studentshexcepthbyhinstructorshusinghthehaccompanyinghtexthinhtheirhclasses
.
Allhrecipientshofhthishworkharehexpectedhtohabidehbyhthesehrestricti
onshandhtohhonorhthehintendedhpedagogicalhpurposeshandhthehneedshofhother
hinstructorshwhohrelyhonhthesehmaterials.
Copyrighth©h2021hbyhPearsonhEducation,hInc.horhitshaffiliates.hAllhRightshReserved.hManufacturedh
inhthehUnitedhStateshofhAmerica.hThishpublicationhishprotectedhbyhcopyright,handhpermissionhshould
hbehobtainedhfromhthehpublisherhpriorhtohanyhprohibitedhreproduction,hstoragehinhahretrievalhsystem,h
orhtransmissionhinhanyhformhorhbyhanyhmeans,helectronic,hmechanical,hphotocopying,hrecording,horh
otherwise.hForhinformationhregardinghpermissions,hrequesthforms,handhthehappropriatehcontactshwit
hinhthehPearsonhEducationhGlobalhRightshandhPermissionshdepartment,hpleasehvisithwww.pearsone
d.com/permissions/.
PEARSON,hALWAYShLEARNING,handhREVELharehexclusivehtrademarkshownedhbyhPearsonhEd
ucation,hInc.horhitshaffiliateshinhthehU.S.hand/orhotherhcountries.
Unlesshotherwisehindicatedhherein,hanyhthird-
partyhtrademarks,hlogos,horhiconshthathmayhappearhinhthishworkharehthehpropertyhofhtheirhrespectiveho
wners,handhanyhreferenceshtohthird-
partyhtrademarks,hlogos,hicons,horhotherhtradehdressharehforhdemonstrativehorhdescriptivehpurposesho
nly.hSuchhreferencesharehnothintendedhtohimplyhanyhsponsorship,hendorsement,hauthorization,horhpr
omotionhofhPearson’shproductshbyhthehownershofhsuchhmarks,horhanyhrelationshiphbetweenhthehown
erhandhPearsonhEducation,hInc.,horhitshaffiliates,hauthors,hlicensees,horhdistributors.
3-2
Copyrighth(c)h2021hPearsonhEducation,hInc.
, AccountinghInformationhSystems
chapter 1 h
accounting information systems:
h h h
An overview
h
SuggestedhAnswershtohDiscussionhQuestions
1.1 Thehvaluehofhinformationhishthehdifferencehbetweenhthehbenef
itshrealizedhfromhusinghthathinformationhandhthehcostshofhpr
oducinghit.h Wouldhyou,horhanyhorganization,heverhproducehin
formationhifhitshexpectedhcostshexceededhitshbenefits?h Ifhs
o,hprovidehsomehexamples.h Ifhnot,hwhy?
Mosthorganizationshproducehinformationhonlyhifhitshvaluehexce
edshitshcost.h However,hthereharehtwohsituationshwherehinform
ationhmayhbehproducedhevenhifhitshcosthexceedshitshvalue.
a. Ithishoftenhdifficulthtohestimatehaccuratelyhthehvalueho
fhinformationhandhthehcosthofhproducinghit.hTherefore,ho
rganizationshmayhproducehinformationhthaththeyhexpecthw
illhproducehbenefitshinhexcesshofhitshcosts,honlyhtohbehd
isappointedhafterhthehfact.
b. Productionhofhthehinformationhmayhbehmandatedhbyheitherh
ahgovernmenthagencyhorhahprivatehorganization.h Example
shincludehthehtaxhreportshrequiredhbyhthehIRShandhdisclos
urehrequirementshforhfinancialhreporting.
1.2 CanhthehcharacteristicshofhusefulhinformationhlistedhinhTab
leh1-
1hbehmethsimultaneously?h Orhdoeshachievinghonehmeanhsacrifi
cinghanother?
SeveralhofhthehcriteriahinhTableh1.1hcanhbehmethsimultaneousl
y.h Forhexample,hmorehtimelyhinformationhis
3-3
Copyrighth(c)h2021hPearsonhEducation,hInc.
, AccountinghInformationhSystems
alsohlikelyhtohbehmorehrelevant.h Verifiablehinformationhishli
kelyhtohbehmorehaccurate.
However,hachievinghonehobjectivehmayhrequirehsacrificinghano
ther.h Forhexample,hensuringhthathinformationhishmorehcomplet
ehmayhreducehitshtimeliness.h Similarly,hincreasedhverifiabi
lityhandhaccuracyhmayhreducehitshtimeliness.
Thehdecisionhmakerhmusthdecidehwhichhtrade-
offsharehwarrantedhinheachhsituation.
1.3 Youhandhahfewhofhyourhclassmateshdecidedhtohbecomehentrepren
eurs.h Youhcamehuphwithhahgreathideahforhahnewhmobilehphonehapp
licationhthathyouhthinkhwillhmakehlotshofhmoney.h Yourhbusine
sshplanhwonhsecondhplacehinhahlocalhcompetition,handhyouharehu
singhtheh$10,000hprizehtohsupporthyourselveshashyouhstarthyo
urhcompany.
a. Identifyhthehkeyhdecisionshyouhneedhtohmakehtohbehsuccessf
ulhentrepreneurs,hthehinformationhyouhneedhtohmakehthem,ha
ndhthehbusinesshprocesseshyouhwillhneedhtohengagehin.
b. Yourhcompanyhwillhneedhtohexchangehinformationhwithhvar
ioushexternalhparties.h Identifyhthehexternalhparties,h
andhspecifyhthehinformationhreceivedhfromhandhsenthtohea
chhofhthem.
Thehauthorhturnshthishquestionhintohanhin-
classhgrouphactivity.h Studentsharehdividedhuphinhgroups,h
toldhtohclosehtheirhbooks,handhgivenh15hminuteshto:
a. Thinkhthroughhthehbusinesshprocesses,hkeyhdecisions,hand
hinformationhneedshissueshinhtheirhgroup.
b. Identifyhthehexternalhusershofhinformationhandhspecif
yhthehinformationhreceivedhfromhandhsenthtoheachhofhthe
m.
Onehgrouphishselectedhtohpresenththeirhanswershtohthehclass.h
Thehotherhgroupsharehtoldhtohchallengehthehgroup’shanswers,hp
rovidehalternativehanswers,handhchiphinhwithhadditionalhansw
ershnothprovidedhbyhthehselectedhgroup.h Sincehthehgrouphthath
presentshishnothselectedhuntilhafterhthehtimehhashexpired,hstu
dentsharehmotivatedhtohdohahgoodhjob,hashtheyhwillhbehpresentin
ghtohtheirhpeers.
Thehvaluehofhthishactivityhishnothinharrivinghatha
3-4
Copyrighth(c)h2021hPearsonhEducation,hInc.
