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Chapter 15

MULTIPLE CHOICE
1. There are five basic stages in the database design process. The step which includes
developing the conceptual-, external-, and internal-level schema into the actual
database structures is known as
a) stage one.
b) stage two.
c) stage three.
d) stage four.

2. Accountants should be involved in __________ aspect(s) of the database design


process.
a) only the physical modeling
b) all
c) only the data flow diagram
d) only the requirements analysis

3. The process of defining a database so that it faithfully represents all aspects of the
organization including its interactions with the external environment is called
a) data modeling.
b) data designing.
c) data development.
d) data definition.

4. Accountants may provide the greatest value to their organization by taking


responsibility for data modeling. In which stage(s) of the database design process
does data modeling occur?
a) only in the systems analysis stage
b) only in the design stage
c) in both the systems analysis and design stages of database design
d) neither the systems analysis nor the design stages of database design

5. A(n) __________ diagram graphically depicts a database's contents by showing


entities and relationships.
a) DFD
b) flowchart
c) E-R
d) REA

6. An entity-relationship diagram (E-R) is useful because it shows the various entities


being modeled and the important relationships among them. Anything about which
the organization wants to collect and store information is called
a) a data model.
b) an entity.
c) a schema.
d) a tuple.

7. An E-R diagram represents entities as __________ and the relationships between


them as lines and __________.
a) circles; squares
b) squares; diamonds
c) rectangles; diamonds
d) rectangles; circles

8. An E-R diagram
a) Can represent the contents of any database.
b) Are only used in conjunction with REA models.
c) Can show a limited number of entities and relationships
d) Are used only to design new databases.

9. An E-R diagram
a) only depicts the contents of a database.
b) only graphically models an organization.
c) only defines a database so that it represents all aspects of the organization.
d) depicts both the contents of a database and graphically models an organization.

10. The REA data model


a) Is used in many areas of business and science.
b) Was developed solely for use in designing accounting information systems.
c) Classifies data into relationships, entities and accounts.
d) All of the above.

11. An example of an event is


a) employees
b) customers
c) sales
d) cash

12. An example of a resource is


a) employees
b) customers
c) sales
d) cash

13. An example of an agent is


a) customer
b) sales
c) cash
d) inventory

14. What does the acronym REA mean?


a) resources, events, agents
b) resources, entities, agents
c) relations, events, agents
d) relations, entities, agents

15. In the REA data modeling technique, the identifiable objects that have economic
value to the organization are called
a) resources.
b) assets.
c) entities.
d) objects.

16. The __________ in the REA model include all of the organization's business
activities.
a) resources
b) events
c) agents
d) entities

17. The groups of people about which an organization collects data to help it better plan,
control, and evaluate performance of its basic business activities are the
a) employees.
b) events.
c) agents.
d) entities.

18. Events must be linked to at least one


a) Account
b) Agent
c) Entity
d) Resource

19. Events must be linked to at least two


a) Agents
b) Entities
c) Events
d) Resources

20. Which of the following is not one of the rules that describe how the three types of
entities should relate to one another in an REA data model?
a) Each event is linked to at least one resource that it affects.
b) Each event is linked to at least one other event.
c) Each event is linked to at least two participating agents.
d) All of the above are important rules.

21. The REA data model supports both __________ and __________ types of data.
a) financial; nonfinancial
b) logical; physical
c) planning; control
d) traditional; nontraditional

22. Nonfinancial information should be collected because


a) it may indicate events that may affect resources.
b) it can be used to plan other activities.
c) it can be used in transaction processing.
d) both A and B
23. Which is a true statement about the REA data model?
a) The REA data model classifies entities into three distinct categories.
b) The term REA is an acronym that stands for resources, entities, and agents.
c) Using an REA data model is not helpful when creating an R-E diagram.
d) The "E" in the REA data model stands for things that have an economic value to the organization.

24. An REA diagram must link every event to at least one __________ and two
__________.
a) resource; agents
b) agent; resources
c) transaction; entities
d) resource; relationships

25. Each event in an REA model will in most cases have at least one __________ agent
and one __________ agent involved with the event.
a) internal; resource
b) external; entity
c) internal; employee
d) internal; external

26. Relationships that affect the quantity of a resource are sometimes referred to as
_______ relationships.
a) commitment
b) exchange
c) stockflow
d) none of the above

27. Using the REA data model, promises to engage in future economic exchanges are
called
a) commitments.
b) economic exchanges.
c) resources.
d) agents.

28. The "give" event represents an activity which


a) includes a promise to engage in future economic exchanges.
b) increases the organization's stock of an economic resource.
c) reduces the organization's stock of a resource that has economic value
d) none of the above.

29. The "get" event represents an activity which


a) includes a promise to engage in future economic exchanges.
b) increases the organization's stock of an economic resource.
c) reduces the organization's stock of a resource that has economic value
d) none of the above.

30. Concerning the development of an REA model, which of the following statements is
true?
a) Events that pertain to the entry of data are included in the REA model.
b) The objective is to model the basic value-chain activity.
c) REA diagrams model individual transactions and data collections.
d) Information retrieval events are modeled as events in the REA model.

31. Developing an REA diagram for a specific transaction cycle consists of how many
steps?
a) one
b) two
c) three
d) four

32. Developing an REA diagram for a specific transaction cycle consists of steps. The
first step involves
a) Identifying events
b) Identifying agents
c) Identifying resources
d) Identifying cardinality

33. Developing an REA diagram for a specific transaction cycle consists of steps. The
second step involves
a) Identifying agents
b) Identifying resources
c) Identifying cardinality
d) Both a and b

34. Developing an REA diagram for a specific transaction cycle consists of steps. The
third step involves
a) Identifying events
b) Identifying agents
c) Identifying resources
d) Identifying cardinalities of each relationship

35. The measure of how many instances of the other entity can be linked to one specific
instance of a given entity is called
a) a resource.
b) a cardinality.
c) an agent.
d) an exchange event.

36. Concerning cardinality, which of the following is false?


a) Cardinalities describe the nature of the relationship between two entities.
b) No universal standard exists for representing information about cardinalities in REA diagrams.
c) The minimum cardinality can be zero.
d) The maximum cardinality can be zero.

37. Concerning cardinality, which of the following is true?


a) The three basic types of relationship between entities are identified by their minimum cardinality.
b) The choice of cardinalities is arbitrary.
c) The minimum cardinality is generally given last.
d) Cardinality information is the final step in drawing an REA diagram
38. In an REA diagram, the pair of numbers next to each entity represents the
cardinalities for the entity. The first number in the pair is known as
a) the minimum cardinality.
b) the maximum cardinality.
c) the x axis cardinality.
d) the y axis cardinality.

39. The minimum cardinality of a relationship in an REA diagram can be either


a) 0 or 1.
b) 0 or N.
c) 1 or N.
d) none of the above

40. The maximum cardinality of a relationship in a REA diagram can be either


a) zero or one.
b) one or many.
c) zero or many.
d) none of the above

41. How many types of relationships are possible between entities?


a) one
b) two
c) three
d) an infinite number

42. A one-to-many relationship exists between entities when the maximum cardinality of
one entity is __________ and the maximum cardinality for the other entity in that
relationship is __________.
a) 1; 1
b) 1; N
c) M; N
d) M; M

43. Cardinalities reflect __________ about the organization being modeled and its
business practices.
a) assumptions
b) opinions
c) facts
d) theories

44. Assume the cardinalities associated in a relationship all have zero minimums and N
maximums. This would be an example of which cardinality rule?
a) agent-event relationship
b) resource-event relationship
c) event-event relationship
d) none of the above relationships
45. Concerning REA diagrams, which of the following is false?
a) Each organization will have its own unique REA diagram.
b) An REA diagram for a given organization will change over time.
c) Data modeling and REA diagram development involve complex and repetitive processes.
d) Redrawing an REA diagram several times during development is uncommon.

46. Which of the following is not one of the five stages of database design?
a) systems analysis
b) conceptual design
c) data modeling
d) implementation

47. Data modeling is an element of


a) Systems analysis
b) Conceptual design
c) Both A and B
d) None of the above

48. The REA model classifies entities into three basic categories. Which of the following
is one of these three?
a) resources
b) relationships
c) accounting
d) entities

49. Developing an REA model involves three steps. In which step are the agents
identified?
a) First
b) Second
c) Third
d) None of the above

50. Which of the following graphical symbols represents a minimum cardinality of zero
and a maximum cardinality of one?
a)
b)
c)
d)

51. Which of the following graphical symbols represents a minimum cardinality of zero
and a maximum cardinality of many?
a)
b)
c)
d)

52. Which of the following graphical symbols represents a minimum cardinality of one
and a maximum cardinality of one?
a)
b)
c)
d)

53. Which of the following graphical symbols represents a minimum cardinality of one
and a maximum cardinality of many?
a)
b)
c)
d)

54. Which of the following transactions is represented by the diagram below?


Sale Inventory

a) An automobile salvage business holds weekly auctions at which it sells its entire inventory.
b) A grocery store sells products to consumers.
c) A hobbyist restores antique cars. When a car is finished, she sells it on Ebay.
d) A firm sells movies to consumers through an online downloading service.

55. Which type of transaction is represented by the diagram below?


Sale Inventory

a) An automobile salvage business holds weekly auctions at which it sells its entire inventory.
b) A grocery store sells products to consumers.
c) A hobbyist restores antique cars. When a car is finished, she sells it on Ebay.
d) A firm sells movies to consumers through an online downloading service.

56. Which type of transaction is represented by the diagram below?


Sale Inventory

a) An automobile salvage business holds weekly auctions at which it sells its entire inventory.
b) A grocery store sells products to consumers.
c) A hobbyist restores antique cars. When a car is finished, she sells it on Ebay.
d) A firm sells movies to consumers through an online downloading service.

57. Which type of transaction is represented by the diagram below?


Sale Inventory

a) An automobile salvage business holds weekly auctions at which it sells its entire inventory.
b) A grocery store sells products to consumers.
c) A hobbyist restores antique cars. When a car is finished, she sells it on Ebay.
d) A firm sells movies to consumers through an online downloading service.
58. Which type of transaction is represented by the diagram below?
Receive
Sale
Cash
a) Cash and carry consumer retail sales
b) Consumer retail sales paid in installments to the seller
c) Business to business sales of nondurable goods
d) Business that allows customers to carry a balance and make installment payments

59. Which type of transaction is represented by the diagram below?


Receive
Sale
Cash
a) Cash and carry consumer retail sales
b) Consumer retail sales paid in installments to the seller
c) Business to business sales of nondurable goods
d) Business that allows customers to carry a balance and make installment payments

60. Which type of transaction is represented by the diagram below?


Receive
Sale
Cash
a) Cash and carry consumer retail sales
b) Consumer retail sales paid in installments to the seller
c) Business to business sales of nondurable goods
d) Business that allows customers to carry a balance and make installment payments

61. Which type of transaction is represented by the diagram below?


Receive
Sale
Cash
a) Cash and carry consumer retail sales
b) Consumer retail sales paid in installments to the seller
c) Business to business sales of nondurable goods
d) Business that allows customers to carry a balance and make installment payments

62. Which type of transaction is represented by the diagram below?


Receive Cash
Inventory Disbursements
a) Vendors send a bill for each inventory item purchased which is payable on receipt.
b) A single purchase of inventory is paid for with multiple payments.
c) Inventory vendors send a monthly bill for merchandise delivered. The seller does not accept or
allow installment payments.
d) Some inventory purchases are paid for with multiple payments and some payments may apply to
multiple purchases.

63. Which type of transaction is represented by the diagram below?


Receive Cash
Inventory Disbursements
a) Vendors send a bill for each inventory item purchased which is payable on receipt.
b) A single purchase of inventory is paid for with multiple payments.
c) Inventory vendors send a monthly bill for merchandise delivered. The seller does not accept or
allow installment payments.
d) Some inventory purchases are paid for with multiple payments and some payments may apply to
multiple purchases.

64. Which type of transaction is represented by the diagram below?


Receive Cash
Inventory Disbursements
a) Vendors send a bill for each inventory item purchased which is payable on receipt.
b) A single purchase of inventory is paid for with multiple payments.
c) Inventory vendors send a monthly bill for merchandise delivered. The seller does not accept or
allow installment payments.
d) Some inventory purchases are paid for with multiple payments and some payments may apply to
multiple purchases.

65. Which type of transaction is represented by the diagram below?


Take Customer
Sale
Order
a) Each sale is associated with a single order and there is a time lag between the time an order is
taken and delivery of the product.
b) Each sale can be comprised of multiple orders and each order can be associated with multiple sales
or no sales.
c) Each sale can be comprised of multiple orders and each order can be associated with one or more
multiple sales.
d) Each sale is associated with a single order and there is no time lag between the time an order is
taken and delivery of the product.

66. Which type of transaction is represented by the diagram below?


Take Customer
Sale
Order
a) Each sale is associated with a single order and there is a time lag between the time an order is
taken and delivery of the product.
b) Each sale can be comprised of multiple orders and each order can be associated with multiple sales
or no sales.
c) Each sale can be comprised of multiple orders and each order can be associated with one or more
sales.
d) Each sale is associated with a single order and there is no time lag between the time an order is
taken and delivery of the product.

67. Which type of transaction is represented by the diagram below?


Take Customer
Sale
Order
a) Each sale is associated with a single order and there is a time lag between the time an order is
taken and delivery of the product.
b) Each sale can be comprised of multiple orders and each order can be associated with multiple sales
or no sales.
c) Each sale can be comprised of multiple orders and each order can be associated with one or more
sales.
d) Each sale is associated with a single order and there is no time lag between the time an order is
taken and delivery of the product.

68. Which type of transaction is represented by the diagram below?


Take Customer
Sale
Order
a) Each sale is associated with a single order and there is a time lag between the time an order is
taken and delivery of the product.
b) Each sale can be comprised of multiple orders and each order can be associated with multiple sales
or no sales.
c) Each sale can be comprised of multiple orders and each order can be associated with one or more
sales.
d) Each sale is associated with a single order and there is no time lag between the time an order is
taken and delivery of the product.

69. Using [Min, Max] notation, cardinality is represented by the following diagram.
Which of the diagrams below correspond to the diagram?
(1, 1) (0, N)
Entity A Entity B

a)

Entity A Entity B
b)

Entity A Entity B
c)

Entity A Entity B
d)

Entity A Entity B
ANSWER KEY 55. A
1. B 56. C
2. B 57. D
3. A 58. A
4. C 59. B
5. C 60. C
6. B 61. D
7. C 62. B
8. A 63. C
9. D 64. D
10. B 65. A
11. C 66. B
12. D 67. C
13. A 68. D
14. A 69. D
15. A
16. B
17. C
18. D
19. A
20. D
21. A
22. D
23. A
24. A
25. D
26. C
27. A
28. C
29. B
30. B
31. C
32. A
33. D
34. D
35. B
36. D
37. D
38. A
39. A
40. B
41. C
42. B
43. C
44. B
45. D
46. C
47. C
48. A
49. B
50. A
51. C
52. B
53. D
54. B

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