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Difficulty: MediumData Processing Methods in Accounting

A commercial bank updates customer account balances instantly whenever transactions occur at Automated Teller Machines (ATMs), but calculates and disburses monthly staff salaries in a single periodic run at the end of each month. Which of the following correctly identifies the data processing methods applied to ATM transactions and staff salary payments respectively?

  1. Real-time processing for ATM transactions and batch processing for salary paymentsAnswer
  2. B
    Batch processing for ATM transactions and real-time processing for salary payments
  3. C
    Online batch processing for ATM transactions and manual processing for salary payments
  4. D
    Bookkeeping processing for ATM transactions and accounting processing for salary payments

Answer

Real-time processing for ATM transactions and batch processing for salary payments
Real-time data processing updates accounting records instantaneously as transactions take place, making it essential for instant operations such as ATM balance checks and withdrawals. Conversely, batch processing accumulates transaction records over time and processes them together as a single group, which is ideal for periodic, high-volume operations like monthly employee payroll.

Step-by-Step Solution

1
Analyze the nature and timing requirement of ATM transactions.
ATM transactions require immediate account validation and continuous master file updating upon execution.
Processing delay in ATM transactions could allow double withdrawals or invalid account balances.
2
Analyze the nature and timing requirement of monthly salary payments.
Salary payments accumulate attendance and wage records throughout the period and execute simultaneously at the end of the month.
Periodic processing of accumulated routine transactions in a group optimizes system resources through batch processing.
3
Match the transaction characteristics to data processing classifications.
ATM transactions correspond to real-time (online) processing, while salary disbursements correspond to batch processing.
Real-time processes data immediately per transaction; batch processes accumulated data periodically.

Key Concept

Classification and suitability of real-time versus batch data processing methods in business accounting operations.
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Topics

Data Processing Methods in Accounting

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