Tasteless Tea Company: A Comprehensive Revenue Transaction Cycle Case Study

Ronald F. Premuroso
University of Montana
William S. Hopwood
Florida Atlantic University - School of Accounting
Som Bhattacharya
Florida Atlantic University
August 31, 2009
Issues in Accounting Education, Vol. 26, No. 1, February 2011
Abstract:
It is challenging for students taking the introductory Accounting Information Sy
stems (AIS) course to envision how to apply the topics and concepts learned duri
ng 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 empha
sis 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 list
ed under the AICPA s Core Competency and Framework for Entry into the accounting p
rofession.
The case study involves analyzing three different types of revenue cycle transac
tions - sales by a direct sales force, retail store sales, and e-commerce web si
te 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 dat
a 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 sem
ester to the class of their system recommendations using PowerPoint. Each group a
lso submits a written report containing their system recommendations, including
responses to a list of case study questions and requirements posed by the instru
ctor.
The experiential learning process and benefits of using such a case in the intro
ductory AIS course are discussed. Teaching methods, including teaching notes on
how to administer the case, and suggested answers for the case study questions a
nd requirements (both summarized and in detail) are presented. Evidence of teach
ing effectiveness of the case is also included.
Keywords: Accounting information systems, internal controls, case study, revenue
transaction cycle
JEL Classification: M40, M41, M49, L81, L86
Accepted Paper Series