June 13, 2011
In today’s business society, technologies such as databases are a vital part of just about every major retail business including the Riordan’s organization. Many people overlook the importance of the role of databases in business because they are integrated so well. Databases definitely affect the output part of the accounting cycle because it includes company’s financial data and other external reports that are derived from the database. The bottom-line is that databases can have a major impact on all of the accounting cycles. Capturing the Output - Financial statements and other external reports The output part of the accounting cycle is extremely important because the information must meet certain guidelines. Because external financial statements are used by a variety of people in a variety of ways, financial accounting has common rules known as accounting standards and as generally accepted accounting principles (GAAP) (Price, 2010). In order to meet such expectations the input (sales invoices, payroll time card, etc.) and Transaction Processing (journals, ledgers, trial balances) that proceed the output part of the accounting cycle must be accurate. Having a manager check the data inputted in the database versus the sales invoices, payroll cards, and other inputted data is a good way to ensure that the output will be accurate. Entity Relationship Diagram for the Output part of the Accounting Cycle Entity relationships in a data base are a major component inside a firm or a business or company that tells a story or passage about the events related to customer or consumer usage to that company. Economic events and information in relation to who and what had involvements to that company. The “Who” of a particular company is called the Agent which is participants of a transaction between the customer and the salesperson: while, the “what” is the event inside the...
References: Price, R. (2010). Financial Accounting. Retrieved from http://www.accountingcoach.com/online-accounting-course/financial-accounting.html
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