7-1 Computerized Accounting Systems Electronic Presentation by Douglas Cloud Pepperdine University Chapter F7

7-1

Computerized Computerized Accounting Accounting

SystemsSystems

Computerized Computerized Accounting Accounting

SystemsSystemsElectronic Presentation by Douglas Cloud

Pepperdine University

Electronic Presentation by Douglas Cloud

Pepperdine University

Chapter Chapter F7F7

7-2

1. Identify the primary components of a computerized accounting system.

2. Describe the components of a computerized accounting system used to process data and produce useful information.

3. Describe how data are processed in various modules of an accounting system.

ObjectivesObjectivesObjectivesObjectives

Once you have Once you have completed this chapter, completed this chapter, you should be able to:you should be able to:

Once you have Once you have completed this chapter, completed this chapter, you should be able to:you should be able to:

ContinuedContinuedContinuedContinued

7-3

4. Explain the use of relational databases to perform accounting functions.

5. Describe how a database system can be used to create a simple accounting system.

ObjectivesObjectivesObjectivesObjectives

7-4

11ObjectiveObjectiveObjectiveObjective

Identify the primary components of a computerized accounting system.

7-5

Components of a Computerized Components of a Computerized Accounting SystemAccounting System


Systems that integrate most of the business information functions as a basis for management decisions are referred to as enterprise resource

planning (ERP) systems.

Systems that integrate most of the business information functions as a basis for management decisions are referred to as enterprise resource

planning (ERP) systems.

7-6

Exhibit Exhibit 11Exhibit Exhibit 11 Components of an Accounting Information System

7-7

The sales module receives order data from customers and maintains accounts receivable

information.



7-8


7-9

The purchases and inventory management module provides purchase order data to vendors.



Vendors are those who supply Vendors are those who supply specific products to a company.specific products to a company.Vendors are those who supply Vendors are those who supply

specific products to a company.specific products to a company.

7-10


7-11

The human resources module maintains data about

employees, including hours worked and wage rates.

It is used for preparing payroll and It is used for preparing payroll and payroll tax information.payroll tax information.

It is used for preparing payroll and It is used for preparing payroll and payroll tax information.payroll tax information.



7-12


7-13

The production module tracks the flow of costs through the

manufacturing process.



7-14


7-15

The asset management module identifies long-term asset costs, their expected useful lives, and where these assets are located

in the company.



7-16


7-17

The financial management module keeps track of debt,

repayment schedules, interest rates, and shareholder

information.



7-18


7-19

The general ledger/financial reporting module provides

information for use by external stakeholders, including

shareholders and government regulators.



7-20

Subsidiary AccountsSubsidiary AccountsSubsidiary AccountsSubsidiary Accounts

Mom’s Cookie Company

Subsidiary accounts include transactions for Mom’s Cookie Company’s individual

customers, suppliers, or products. Records for all subsidiary accounts of a particular

type are maintained in a subsidiary ledger.

Subsidiary accounts include transactions for Mom’s Cookie Company’s individual

customers, suppliers, or products. Records for all subsidiary accounts of a particular

type are maintained in a subsidiary ledger.

7-21

Control AccountsControl AccountsControl AccountsControl Accounts

Control accounts are summary accounts that maintain totals for all subsidiary

accounts of a particular type.

Control accounts are summary accounts that maintain totals for all subsidiary

accounts of a particular type.

Example: Example: The balance for The balance for Accounts Accounts Receivable Receivable is the sum of the is the sum of the balances of all subsidiary accounts balances of all subsidiary accounts for the company’s customers.for the company’s customers.

Example: Example: The balance for The balance for Accounts Accounts Receivable Receivable is the sum of the is the sum of the balances of all subsidiary accounts balances of all subsidiary accounts for the company’s customers.for the company’s customers.

7-22

Control AccountsControl AccountsControl AccountsControl Accounts

Records for each control account are maintained in a company’s general ledger.

Records for each control account are maintained in a company’s general ledger.

7-23

22Describe the components of a computerized accounting system used to process data and produce useful information.

ObjectiveObjectiveObjectiveObjective

7-24

Exhibit 2Exhibit 2Exhibit 2Exhibit 2 Data Processing in a Computerized Information System

7-25

Using computer networks, such as

the Internet, to make customer sales is referred

to as E-business.

Using computer networks, such as

the Internet, to make customer sales is referred

to as E-business.

7-26

Application software includes

the computer programs that

permit data to be recorded and processed.

Application software includes

the computer programs that

permit data to be recorded and processed.

7-27

A database is a set of computerized files

in which company data are stored in the form that facilitates

retrieval and updating of the data.

A database is a set of computerized files

in which company data are stored in the form that facilitates

retrieval and updating of the data.

7-28

A database management system

controls database functions to ensure data are recorded properly and are accessed only by authorized users.

A database management system

controls database functions to ensure data are recorded properly and are accessed only by authorized users.

7-29

Exhibit Exhibit 44Exhibit Exhibit 44 A Computer Network

7-30

A computer network is a set of hardware

devices that are linked so they can

exchange data among themselves using

software.

7-31

33Describe how data are processed in various modules of an accounting system.


7-32

CustomerCustomer SalesSales

sales order

Sales fileSales file

Customer fileCustomer file

invoice AccountingAccountingGeneral General

Ledger filesLedger files

ShippingShipping

cash

goodsInventory fileInventory file

A Sales Processing ModuleExhibit 5Exhibit 5Exhibit 5Exhibit 5

7-33

Good internal controls requires that the personnel who account

for the cash should not also have physical access to the cash.

Good internal controls requires that the personnel who account

for the cash should not also have physical access to the cash.

7-34

A Purchases and Inventory Management Module

Exhibit 6Exhibit 6Exhibit 6Exhibit 6

Purchase orderVendorVendor PurchasingPurchasing Vendor filesVendor files

invoiceAccountingAccounting

General General Ledger filesLedger files

ReceivingReceiving

cash

goodsInventory filesInventory files

7-35

The Purchasing and Inventory The Purchasing and Inventory Management ModuleManagement Module

The Purchasing and Inventory The Purchasing and Inventory Management ModuleManagement Module

The interaction of a company

and its suppliers is known as

supply-chain management.

The interaction of a company

and its suppliers is known as

supply-chain management.

7-36

A Human Resources ModuleExhibit 7Exhibit 7Exhibit 7Exhibit 7

Time workedEmployeeEmployee ProductionProduction Production filesProduction files

AccountingAccountingGeneral General


PersonnelPersonnel

Cash

Employee filesEmployee filesGovernmentGovernment

Cash and payroll tax information

7-37

A Production ModuleExhibit 8Exhibit 8Exhibit 8Exhibit 8

Orders/ forecastSalesSales ManufacturingManufacturing Inventory filesInventory files

Cost accounting

Cost accounting General General


Stores/ warehouse

Stores/ warehouse Plant Asset filesPlant Asset files

Employee filesEmployee files

7-38

44Explain the use of relational databases to perform accounting functions.


7-39

Relational DatabaseRelational DatabaseRelational DatabaseRelational Database

A relational database is a set of related files that are linked so that files can be updated and information can be retrieved from the

files efficiently.

A relational database is a set of related files that are linked so that files can be updated and information can be retrieved from the

files efficiently.

A table is a file that contains data represented

as rows and columns. Each column identifies a particular attribute of the

entity or process described in the table.

A table is a file that contains data represented

as rows and columns. Each column identifies a particular attribute of the

entity or process described in the table.

Each attribute in the table is referred to as

a field.

Each attribute in the table is referred to as

a field.

7-40

55Describe how a database system can be used to create a simple accounting system.


7-41

Copying and Opening Copying and Opening the Databasethe Database


It is highly recommended

that the database be copied to a

hard drive before it is used.

It is highly recommended

that the database be copied to a

hard drive before it is used.

7-42



It is a good idea to make several

copies of the database under

different names.

It is a good idea to make several

copies of the database under

different names.

MomsCookies1.mdb, MomsCookies 2.mdb, etc.MomsCookies1.mdb, MomsCookies 2.mdb, etc.MomsCookies1.mdb, MomsCookies 2.mdb, etc.MomsCookies1.mdb, MomsCookies 2.mdb, etc.

7-43

Database ContentsDatabase ContentsDatabase ContentsDatabase Contents

Tables contain the data stored in the system.

Queries are short programs that permit a user to obtain data from one or more tables.

Forms provide a means for entering or reading data stored in the database.

Reports provide summary information intended primarily to be printed.

ContinuedContinuedContinuedContinued

7-44

Database ContentsDatabase ContentsDatabase ContentsDatabase Contents

Macros are sequences of steps a user performs to complete a particular task.

Pages provide a means of creating web documents for accessing a database.

Modules are computer programs to provide higher level functions in the database.

7-45

THE ENDTHE END

CCHAPTERHAPTER F7 F7

7-46

Documents

7-1 Computerized Accounting Systems Electronic Presentation by Douglas Cloud Pepperdine University Chapter F7