Tasteless Tea Company

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ISSUES IN ACCOUNTING EDUCATION Vol. 26, No. 1 2011 pp. 163–179

American Accounting Association DOI: 10.2308/iace.2011.26.1.163

Tasteless Tea Company: A Comprehensive Revenue Transaction Cycle Case Study Ronald F. Premuroso, William S. Hopwood, and Somnath Bhattacharya ABSTRACT: It is challenging for students taking the introductory accounting information systems AIS course to envision how to apply the topics and concepts learned during the course in real-world situations. The motivation for this case study is to have groups of students apply the many topics and concepts learned in the first AIS course to a hypothetical real-world company situation, with particular emphasis on developing a proposed new and improved system for the revenue transaction cycle. The study is also designed to help meet several of the competencies listed under the AICPA’s Core Competency and Framework for Entry into the Accounting Profession. The case study involves analyzing three different types of revenue cycle transactions—sales by a direct sales force, retail store sales, and e-commerce website sales. Each student group is required to prepare a system analysis and design report, including addressing a list of requirements encompassing topics covered during the introductory AIS course. The requirements include preparation of data flow diagrams or system flowcharts using Microsoft Visio®, a balanced scorecard report, and the design of specification of internal controls appropriate to the revenue transaction cycle. Each group makes a presentation at the end of the semester to the class of their system recommendations using PowerPoint®. Each group also submits a written report containing their system recommendations, including responses to a list of case study questions and requirements posed by the instructor. The experiential learning process and benefits of using such a case in the introductory AIS course are discussed. Teaching methods, including Teaching Notes on how to administer the case, and suggested answers for the case study questions and requirements both summarized and in detail are presented. Evidence of teaching effectiveness of the case is also included. Keywords: accounting information systems; case study; internal controls; revenue transaction cycle. Ronald F. Premuroso is an Assistant Professor at The University of Montana and William S. Hopwood and Somnath Bhattacharya are Professors at Florida Atlantic University. The authors are grateful to David Pritchard for assistance with the development of the initial framework for the case study. The authors appreciate comments received on earlier versions of this paper from two anonymous reviewers from the AIS Educator Association related to the 2009 AIS Educators Conference, and an anonymous reviewer from the Information Systems section of the 2009 AAA Annual Meeting. The authors also thank participants at the 2009 AIS Educators Conference, participants at the 2009 AAA Annual Meeting, and professor Terri Herron for their comments and suggestions on earlier versions of the case. The authors appreciate comments from the editor and two anonymous reviewers from Issues in Accounting Education. Editor’s note: Accepted by Kent St. Pierre.

Published Online: February 2011

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Premuroso, Hopwood, and Bhattacharya Data Availability: The authors are willing to make their data available for use by others in extending or replicating results reported in the case study. All correspondence should be addressed to the first author.

THE CASE he Tasteless Tea Company hereafter, Tasteless is a market leader in the expanding U.S. market for tea processed tea leaves , tea-related consumer beverage products, and tearelated desserts. Tasteless produces and sells tea bags, tea leaves, iced tea drinks, and a line of premium tea-based ice creams, as well as an innovative combination of premium tea product lines. Tasteless maintains its corporate headquarters in Danbury, Connecticut. The...
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