Chapter 1 Significance of Accounting Information Systems and the Accountant’s Role INTRODUCTORY SCENARIO: SUGGESTED SOLUTIONS TO QUESTIONS 1. Employee overtime hours, customer information (e.g., age groups), inventory levels, reorder points, EOQ calculation, volume/quantity discount analysis, square footage in use v. storage, customer flow data, spoilage 2. How much is client willing to pay? System that is easy for servers to use with proper controls. Bob’s hourly rate would be a concern for client. Will Bob be around “after the sale” (i.e., tech support)? What types of pre-packaged systems are available? 3. Information to help with software division (e.g., total sales dollars, complexity of accounting system). How many computers needed? Any expansion planned? What types of employees do they have (e.g., waiters would want quick touch screens)? 4 The owner of the restaurant wants a new accounting system because he needs up-to-date information on how the business is doing. Waiting until the end of the year, or even the quarter, does not give Marshall the information he needs to make those day-to-day decisions that will ensure the success of his restaurant. CHAPTER VIGNETTES: SUGGESTED RESPONSES TO QUESTIONS Vignette 1.1 1. Closer relationships with remaining suppliers, the ability to carry less inventory (reducing carrying costs and risks of theft or loss of inventory), sharing of planning information with suppliers, easier to monitor vendor performance. Might lose volume discounts if trying to minimize inventory on hand by having smaller shipments from vendors shipped more often. 2. Reduction in paperwork, reduction in input errors, ordering and cash receipt processes more efficient, increases in efficiency in meeting changes in demand. One disadvantage would relate to problems with settling disputed orders or payments with loss of “paper trail” that includes authorized signatures. Vignette 1.2 1. Managers would probably find information in units to be most useful for planning decisions because this information would represent things over which he/she has control. While the manager might not have control over salaries, he/she does have control over the amount of overtime and the approval of vacation of the employees. 2. Managers would probably want information related to production numbers (to determine seasonality; during slow times, more employees could be on vacation), the number of vacation hours per employee, the number of overtime hours per employee, backorder information, and information to help the manager match staffing levels with production. Vignette 1.3 1. The privacy of information is a major consideration, as the customer might not want their spending pattern information shared with other parties. Loss of confidential information can be disastrous to a company’s reputation and lead to significant financial losses (lost sales, fines, etc.) Information about customers must