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accounting information system (AIS)
set of business processes that record transactions using journals and ledgers (for paper systems) and computer files (for computerized systems) to keep track of a company’s transactions, process the data associated with these transactions, and produce output useful for internal and external decision-making and analysis
accounts payable subsidiary ledger
special ledger that contains information about all vendors and the amounts we owe them; the total of all accounts in the accounts payable subsidiary ledger must equal the total of accounts payable control account in the general ledger
accounts receivable control
accounts receivable account in the general ledger
accounts receivable subsidiary ledger
special ledger that contains information about all customers and the amounts they owe; the total of all accounts in the accounts receivable subsidiary ledger must equal the total of accounts receivable control account in the general ledger
artificial intelligence
computerized systems that are taught to use reasoning and other aspects of human intelligence to mimic some of the tasks humans perform
audit trail
step-by-step trail of evidence documenting the history of a transaction from its inception and all the steps it went through until its completion
big data
data sets from online transactions and other sources that are so large that new software and methods have been created to analyze and mine them so they can provide insight into trends and patterns of the business
blockchain
underlying technology Bitcoin is built on; provides a single shared ledger used by all of the parties to a transaction resulting in cheaper, more secure, and more private transactions
cash disbursements journal
special journal that is used to record outflows of cash; every time cash leaves the business, usually when we issue a check, we record in this journal
cash receipts journal
special journal that is used to record inflows of cash; every time we receive checks and currency from customers and others, we record these cash receipts in this journal
cloud computing
using the internet to access software and information storage facilities provided by companies (there is usually a charge) rather than, or in addition to, storing this data on the company’s computer hard drive or in paper form
cryptocurrency
digital currency that uses encryption techniques to verify transfer of the funds but operates independently of a bank
data
parts of accounting transactions that constitute the input to an accounting information system
data analytics
analyzing the huge amount of data generated by all the electronic transactions occurring in a business
data/information storage
way to save data and information; can be on paper, computer hard drive, or through the internet to save in the cloud
enterprise resource planning (ERP)
system that helps a company streamline its operations and helps management respond quickly to change
expert system
software program that is built on a database; software asks question and uses the response to ask the next question or offer advice
forensic accounting
using accounting and computer skills to look for fraud and to analyze financial records in hard copy and electronic formats
point of sale
point of time when a sales transaction occurs
point-of-sale system (POS)
computerized system to record and process a sale immediately when it occurs, usually by scanning the product bar code
purchases journal
special journal that is used to record purchases of merchandise inventory on credit; it always debits the merchandise inventory account (if using the perpetual inventory method) or the Purchases account (if using the periodic method)
sales journal
special journal that is used to record all sales on credit; it always debits accounts receivable and credits sales, and if the company uses the perpetual inventory method it also debits cost of goods sold and credits merchandise inventory
schedule of accounts payable
table showing each amount owed and to whom it must be paid; total of the schedule should equal the total of accounts payable in the general ledger
schedule of accounts receivable
table showing each customer and the amount owed; total of the schedule should equal the total of accounts receivable in the general ledger
source document
paper document or electronic record that provides evidence that a transaction has occurred and includes details about the transaction
special journal
book of original entry that is used to record transactions of a similar type in addition to the general journal
turn-around document
paper document that starts off as an output document from one part of the accounting information system (billing sends bill to customer), that becomes input to another part of the accounting information system upon completion of the next phase of the process (accounts receivable receives payment made on bill)
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