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Financial Computer Packages Question Paper
Financial Computer Packages
Course:Bachelor Of Commerce
Institution: Kca University question papers
Exam Year:2011
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UNIVERSITY EXAMINATIONS: 2010/2011
SECOND YEAR EXAMINATION FOR THE DEGREE OF BACHELOR OF
COMMERCE
CMS 205: FINANCIAL COMPUTER PACKAGES (D+E)
DATE: AUGUST 2011 TIME: 2 HOURS
INSTRUCTIONS: Answer Question One and any other Two Questions
Question One
a) Describe in detail how Physical access controls and Logical access controls can be used to enhance
security in an organization.
i) Physical access controls. (4 Marks)
ii) Logical access controls. (4 Marks)
b) State any four software used in accounting. (2 Marks)
c) Outline any two functionalities provided by accounting software. (4 Marks)
d) Describe how the payback method and the discounted payback period can be used in making
investment decisions (6 Marks)
e) Discuss the steps used in developing an information system (10 Marks)
Question Two
A computer based information system requires methods and devices that will ensure
accuracy and validity of information system activities.
(a) Explain any two common tests used to validate data input in a computer based information system.
(4 Marks)
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(b) Describe how access to financial statements and reports generated by a computer based accounting
information system should be controlled. (4 Marks)
(c) Suggest four reasons that would lead to maintenance of a finance computer software. (4 Marks)
(d) Explain Four security features available in a spreadsheet software such as Excel. (8 Marks)
Question Three
a) Compute the three-year and the five year moving averages for the following set of data.
Period Value
1 69
2 84
3 90
4 94
5 93
6 112
7 120
8 129
9 147
10 162
11 178
12 196
13 220
14 236
15 260
(6 Marks)
b) Picasso Company is a wholesale distributor of professional equipment and supplies. The company’s
sales have averaged about sh900,000 annually for the 3-year period 2008-2010. The firm’s total
assets at the end of 2010 amounted to sh850,000.
The president of Picasso Company has asked the chief accountant (controller) to prepare a report that
summarizes the financial aspects of the company’s operations for the past 3 years. This report will be
presented to the Board of Directors at their next meeting.
In addition to comparative financial statements, the chief accountant has decided to present a number
of relevant financial ratios which can assist in the identification and interpretation of trends. At the
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request of the chief accountant, the accounting staff has calculated the following ratios for the 3-year
period 2008-2010:
2008 2009 2010
Current ratio 1.80 1.89 1.96
Acid-test (quick) ratio 1.04 0.99 0.87
Accounts receivable turnover 8.75 7.71 6.42
Inventory turnover 4.91 4.32 3.42
Percent of total debt to total assets 51 46 41
percent of long-term debt to total assets 31 27 24
Sales to fixed assets (fixed asset turnover) 1.58 1.69 1.79
Sales as a percent of 2008 sales 1.00 1.03 1.07
Gross margin percentage 36.0 35.1 34.6
Net income to sales 6.9% 7.0% 7.2%
Return on total assets 7.7% 7.7% 7.8%
Return on stockholders' equity 13.6% 13.1% 12.7%
In preparation of the report, the chief accountant has decided first to examine the financial ratios
independently of any other data to determine if the ratios themselves reveal any significant trends over
the 3-year period.
Required:
i. The current ratio is increasing while the acid-test (quick) ratio is decreasing. Using the ratios
provided, identify and explain the contributing factor(s) for this apparently divergent trend
(8 Marks)
ii. In terms of the ratios provided, what conclusion(s) can be drawn regarding the company’s use of
financial leverage (gearing) during the 2008-2010 period? (6 Marks)
Question Four
Required:
a) Explain in details the full functionality of ANY FOUR commands on the QuickBooks toolbar given
above. (8 Marks)
b) How do you setup a user in QuickBooks? (2 Marks)
c) How do you order and receive the goods in QuickBooks (4 Marks)
d) How do sell on credit in QuickBooks (3 Marks)
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e) How do you activate the inventory account in QuickBooks? (3 Marks)
Question Five
(a)Outdoors, Inc., has lawn furniture as one of its product lines. They currently have three items in that
line: a lawn chair, a standard bench, and a table. These products are produced in a two-step
manufacturing process involving the tube bending department and the welding department. The
hours required by each item in each department is as follows:
The profit contribution that Outdoors receives from manufacture and sale of one unit of each
product is $3 for a chair, $3 for a bench, and $5 for a table. The company is trying to plan its
production mix for the current selling season. They feel that they can sell any number they
produce, but unfortunately production is further limited by available material because of a
prolonged strike. The company currently has on hand 2,000 pounds of tubing. The three
products require the following amounts of this tubing: 2 pounds per chair, 3 pounds per bench,
and 4.5 pounds per table.
Required:
i. Formulated a linear programming problem (5 Marks)
ii. Create a spreadsheet model for the problem (5 Marks)
(b)Draw a Purchase order data entry form with the following information :
Invoice To, Order No, Date, Supplier Name, Mode of payment ,Description of Goods, Ref. Qty.,
rate, unit & amt, Amount chargeable, Terms of delivery ,VAT. (10 Marks)
draw a purchase order form – 8 Marks for entering all details, 2 Marks for correct structure.
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