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Chapter 2Overview of Transaction Processing and ERP Systems
Copyright © 2012 Pearson Education 2-1
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Learning Objectives
! Describe the four major steps in the data processing cycle.! Describe the major activities in each cycle.
! Describe documents and procedures used to collectedand process data.
! Describe the ways information is stored in computer-basedinformation systems.
! Discuss the types of information that an AIS can provide.
! Discuss how organizations use ERP systems to processtransactions and provide information.
Copyright © 2012 Pearson Education 2-2
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Data Processing Cycle
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The Data Processing CycleDetermines
! What data is stored?
! Who has access to the data?
! How is the data organized?
! How can unanticipated information needs be met?
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Data Input—Capture
! As a business activity occurs data is collected about:1. Each activity of interest2. The resources affected3. The people who are participating
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Paper-Based Source Documents
! Data are collected onsource documents! E.g., a sales-order form! The data from paper-
based will eventually
need to be transferred tothe AIS
! Turnaround! Usually paper-based! Are sent from
organization to customer! Same document is
returned by customer toorganization
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Turnaround Document
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Source Data Automaton
! Source data is captured! In machine-readable form! At the time of the business activity
! E.g., ATM’
s; POS
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Data Input—Accuracy and Control
! Well-designed source documents can ensure that datacaptured is! Accurate
! Provide instructions and prompts!
Check boxes! Drop-down boxes! Complete
! Internal control support! Prenumbered documents
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Data Storage
! Types of AIS storage:! Paper-based
! Ledgers! Journals
! Computer-based
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Ledgers
! General! Summary level data for each:
! Asset, liability, equity,
revenue, and expense! Subsidiary
! Detailed data for a GeneralLedger (Control) Accountthat has individual sub-accounts! Accounts Receivable! Accounts Payable
• Joe Smith$250
• Patti Jones
$750
• ACME Inc.
$150• Jones, Inc$350
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Journals
! General! Infrequent or specialized transactions
! Specialized! Repetitive transactions
! E.g., sales transactions
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Coding Techniques
! Sequence! Items numbered consecutively
! Block! Specific range of numbers are
associated with a category
! 10000–199999 = Electric Range
! Group! Positioning of digits in code provide
meaning
! Mnemonic! Letters and numbers! Easy to memorize! Code derived from description of item
! Chart of accounts! Type of block coding
Copyright © 2012 Pearson Education 2-12
Digit Position Meaning
1–2 Product Line, size,and so on
3 Color
4–5 Year ofManufacture
6–7 Optional Features
1241000 12 = Dishwasher4 = White10 = 201000 = No Options
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Computer Based Storage
! Entity! Person, place, or thing (Noun)! Something an organization wishes to store data about! Attributes
! Facts about the entity! Fields
! Where attributes are stored! Records
! Group of related attributes about an entity! File
! Group of related Records
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File Types
! Transaction! Contains records of a
business from a specificperiod of time
! Master! Permanent records! Updated by transaction
with the transaction file
! Database! Set of interrelated files
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Data Processing
! Four Main Activities1. Create new records2. Read existing records3. Update existing records
4.
Delete records or data from records
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Data Output Types
! Soft copy! Displayed on a screen
! Hard copy! Printed on paper
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ERP Systems
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Enterprise Resource Planning (ERP)
! Integrate an organization ’ s information into one overallAIS
! ERP modules:! Financial! Human resources and payroll! Order to cash! Purchase to pay! Manufacturing! Project management! Customer relationship management! System tools
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ERP Disadvantages
! Cost
! Time-consuming to implement
! Changes to an organization’
s existing business processes
can be disruptive! Complex
! Resistance to change
Copyright © 2012 Pearson Education 2-20
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