21) The ________ is not a transaction cycle.
A) general ledger and reporting cycle
B) expenditure cycle
C) revenue cycle
D) human resources cycle
Answer: A
Concept: Information needs and business processes
Objective: Learning Objective 2
Difficulty: Moderate
AACSB: Analytical Thinking
22) Identify the false statement below.
A) Retail stores do not have a production cycle.
B) Financial institutions have installment-loan cycles.
C) Every organization should implement every transaction cycle module.
D) A service company does not have an inventory system.
Answer: C
Concept: Information needs and business processes
Objective: Learning Objective 2
Difficulty: Easy
AACSB: Analytical Thinking
23) Transaction cycles can be summarized on a high level as "give-get" transactions. An example of "give-get" in the revenue cycle would be
A) give cash, get goods.
B) give goods, get cash.
C) give cash, get labor.
D) give cash, get cash.
Answer: B
Concept: Information needs and business processes
Objective: Learning Objective 2
Difficulty: Easy
AACSB: Analytical Thinking
24) Groups of related business activities such as the acquisition of merchandise and payment of vendors are called
A) transaction cycles.
B) economic cycles.
C) business events.
D) transactions.
Answer: A
Concept: Information needs and business processes
Objective: Learning Objective 2
Difficulty: Easy
AACSB: Analytical Thinking
25) The transaction cycle that includes product design is known as the
A) revenue cycle.
B) expenditure cycle.
C) production cycle.
D) financing cycle.
Answer: C
Concept: Information needs and business processes
Objective: Learning Objective 2
Difficulty: Easy
AACSB: Analytical Thinking
26) The transaction cycle approach yields efficiencies when processing of a large number of transactions because
A) a large number of transactions within a given cycle can be categorized into a relatively small number of distinct types.
B) transaction cycles are easier to computerize.
C) the transaction cycle approach represents the natural order of business.
D) transaction cycles are easy to understand.
Answer: A
Concept: Information needs and business processes
Objective: Learning Objective 2
Difficulty: Moderate
AACSB: Analytical Thinking
27) Updating accounts receivable is part of which transaction cycle?
A) human resources/payroll
B) expenditure
C) financing
D) revenue
Answer: D
Concept: Information needs and business processes
Objective: Learning Objective 2
Difficulty: Moderate
AACSB: Analytical Thinking
28) Who of the following would not be involved in the expenditure cycle?
A) accounts payable clerk
B) receiving clerk
C) cashier
D) requisition manager
Answer: C
Concept: Information needs and business processes