Data processing cycle:
The operation performed on data to generate meaningful and relevant data ( 4 steps)
What are the 4 steps in processing cycle?
What are three facets of the data collected?
Each activity of interest
The resources affected by each activity
The people who participate in each activity
Source documents: The paper data for each activity used to capture transaction data at its source,
Ex: sales order, delivery tickets, etc.
Turn around documents: Are company "output" sent to an external party, who adds data to it, and then sends back to the company as an "input document".
Ex: utility bill
Source data automation: Are devices that capture transaction data in machine-readable form at the time and place of their origin.
Ex: ATM, POS scanner, bar codes scanners.
What are the three steps in Data input stage?
(1) Capture transaction data and enter them into the system.
(2) Make sure the data captured are accurate and complete. (use well-designed turn around document, data entry screens, pre-numbered documents)
(3) Make sure the company policies are follow.
General Ledger: Contains summary-level data for every asset, liability, equity, revenue and expense account. They are Control Account.
Subsidiary Ledger: Contains details for any general ledger account with specific names of many individual sub-accounts. ex: AR, Inventory, fixed assets, AP.
Control account: title given to a general ledger account that summarizes the total amounts recorded in a subsidiary ledger
Coding: the systematic assignment of numbers or letters to items to classify and organize them.
Sequence codes: Items are number consecutively to account for all items.
Ex: pre-numbered checks, invoice and purchase orders.
Block Code: Blocks of number reserved for specific categories of data.
Ex: chart of accounts
Group codes: two or more subgroups of digits used to code items, often used in conjunction with block codes
Mnemonic codes: Letters and numbers are interspersed in identify an item.
What are the 4 guidelines in better coding system?
Be consistent with its intended use
Allow for growth
Be as simple as possible to minimize cost, facilitate memorization, interpretation and ensure employee acceptance.
Be consistent with organizational structure and across the company's divisions.
Chart of account: a listing of all the numbers assigned to balance sheet and income statement accounts. The account numbers allow transaction data to be coded, classified, and entered into the proper accounts and also facilitate financial statement preparation
General journal: is use to record infrequent transactions (loan payment, end-of-period adjusting entries)
Specialized journal: Is used to record large numbers of repetitive transactions (sales, cash payment, cash receipts, etc)
Audit Trail: Is a traceable path of transaction thru a data processing system from point of origin to final products and vice versa. It is used to check the accuracy and validity of ledger postings.
Computer based data storage concepts
Entity: Is something about which information is stored: employees, inventory items, customers. Each entity has a same set of attributes
Attributes: Characteristics of interest stored in the database such as pay rates, addresses, name.
Field: Where data are stored. Each cell of a spreadsheet is a field.
Record: A set of fields whose data values describe specific attributes of an entity. An example is a row on a spreadsheet.
Data value: actual value stored in the field
File: Is a group of related records
Master file: Stores cumulative information about the organization . Master file is permanent. Individual master file may change frequently.
Transaction file: Contains record of