AIS requirements would be well-suited to outsourcing its data processing? 000

Accounting Information Systems
10th Edition
ISBN:9781337619202
Author:Hall, James A.
Publisher:Hall, James A.
Chapter4: The Revenue Cycle
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Which of the following organisations' AIS requirements would be well-suited to outsourcing its data processing?
1. Clown Clothes produces and wholesales clothing products to retailers worldwide. 80% of its sales orders are taken during the months of October
and November. Clown Clothes require a system that will manage online ordering and fulfilment.
II. Global Holdings Limited is in the business of buying businesses, managing them for no more than two years, and then selling them at a profit.
The organisation requires a flexible system that will allow them to effectively manage the various types of businesses it controls.
II. Modest Investment Services manages highly diversified portfolios and provides personal services to high-income investors worldwide. The
organisation needs a system that will pull together selected investment data from a large variety of sources and allow account managers to
prepare customised reports for customers.
O Option II only.
Options Il and III only.
O Options I and II only.
Option I only.
Transcribed Image Text:Which of the following organisations' AIS requirements would be well-suited to outsourcing its data processing? 1. Clown Clothes produces and wholesales clothing products to retailers worldwide. 80% of its sales orders are taken during the months of October and November. Clown Clothes require a system that will manage online ordering and fulfilment. II. Global Holdings Limited is in the business of buying businesses, managing them for no more than two years, and then selling them at a profit. The organisation requires a flexible system that will allow them to effectively manage the various types of businesses it controls. II. Modest Investment Services manages highly diversified portfolios and provides personal services to high-income investors worldwide. The organisation needs a system that will pull together selected investment data from a large variety of sources and allow account managers to prepare customised reports for customers. O Option II only. Options Il and III only. O Options I and II only. Option I only.
Expert Solution
Evaluation of options

Option I is correct. Clown Clothes wants a system to manage its online ordering and fulfilment. This particular operational activity only need to be done which can be outsourced to carry out efficiently.

Option II is wrong because Global Holdings Limited need not outsource their activity but they can use technological systems to manage business types.

Option III is wrong because Modest Investment Services can introduce advanced information systems to collect data and prepare reports. There is no need of outsourcing the activity.

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