BRIEF EXERCISES cate whether each of the following statements is true or false.
ID: 2552958 • Letter: B
Question
BRIEF EXERCISES cate whether each of the following statements is true or false. E7-1 Indi n designing an accounting system, we need to think about the needs and know edge of both the top managers and various other When the environment changes as a result of technological advances tition, or government regulation, an accounting system does not have to be sufcienly flexible to meet the changes in order to save money I. e en vironment changes as a resul users. t of technological advances, increased compe- 3. In developing an accounting system, cost is relevant. The benefits obtained from the information disseminated must outweigh the cost of providing it.Explanation / Answer
When designing an accounting system, Special reports are needed and for preparing the special reports we need to think about the needs and knowledge of both the top managers and various other users.
2. False
The system must be flexible enough to cope up the changes that take place due to technological advances, increased competition or government regulation otherwise itwill not able to compete with its competitors . The system should not be rigid. It must be flexible.
3. True
Budget is considered as the most important consideration while establishing an accounting system. The benefits which we get from the programs should always be greater than the cost.
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