Which of the following statements pertaining to inventory are TRUE ?

Purchasing inventory on account increases assets and increases liabilities.

Inventory is classified as a liability.

Selling $100 of inventory to a customer on account for $150 increases assets and decreases equity.

What are TWO common uses of budget variance reports? More than one answer may be selected.

To provide financial information to owner's for planning or evaluation purposes.

To estimate expenditures for a future accounting period.

To estimate the effects of new borrowings on profitability.

To provide financial information to vendors for credit analysis.

You receive a check from a customer for an open invoice. After recording this transaction, which TWO statements about the accounting equation are correct? More than one answer may be selected.

There will be no change in total equity.

There will be no change in total assets.

Total liabilities will decrease.

Identify the definition for the following term: NSF

A bank charge against the account balance when a check bounces.

The ledger balance as of a certain date.

A deposit transaction recorded on the books, but not yet reported on the bank statement.

A check or other payment issued that has not yet cleared and been reported on the bank statement.

Identify the definition for the following term: Book Balance

The ledger balance as of a certain date.

A bank charge against the account balance when a check bounces.

A deposit transaction recorded on the books, but not yet reported on the bank statement.

A check or other payment issued that has not yet cleared and been reported on the bank statement.

Identify the definition for the following term: Outstanding

A check or other payment issued that has not yet cleared and been reported on the bank statement.

The ledger balance as of a certain date.

A bank charge against the account balance when a check bounces.

A deposit transaction recorded on the books, but not yet reported on the bank statement.

You review a comparative income statement that displays five years of data. What information can you gather from this statement?

Trends in income and expenses over time.

Trends in cash on hand over time.

Trends in current ratio over time.

Trends in inventory asset turnover over time.

You are a bookkeeper for a store that sells school uniforms. You need to record the following transactions in the books: 1. In january, the store purchased 10 uniforms for $500. 2. In January, the store sold 10 uniforms to a customer for $1,000, payable in 30 days. 3. In February, the customer paid the invoice of $1,000 in full. Determine which of the statements below are TRUE .

In January, you should debit Accounts Receivable for $1,000.

The Cost of Goods Sold is $1,000.

Read each statement about payroll accounts. Select ONLY the statements that are TRUE . More than one answer may be selected.

The two primary records for payroll are the Payroll Register and the Employee Earnings Record.

The Payroll Register records the payroll information for all employees for each pay period.

The Employee Earnings Record is prepared first and provides data for the payroll register.

For each quarter, you must prepare new Employee Earnings Records for each individual.

What information is provided by a Budget vs. Actual Income Statement?

A comparison of the actual profitability of the business to estimated income and expenses.

The profitability of the business based on customer payments received and vendor payments cleared, compared to the profitability of the business based on payables.

Outstanding vendor bills that the company has budgeted for, but not yet paid.

The allocation of funds to upcoming expenses.

Which statement most accurately summarizes the adjusting process?

Analysis and updating of accounts at the end of the accounting period, before financial statements are prepared.

Verification of journal entries to bring accounts up to date at the end of the accounting period.

Evaluation of reported assets and liabilities on the Balance Sheet at the end of the accounting period.

Evaluation of reported revenues and expenses on the Income Statement during the accounting period.

You are a bookkeeper for a startup company that uses the accrual basis of accounting. In the first quarter of operations the following transactions occur. 1. The owner invests $10,000 cash and $5,000 of office equipment into the new business. 2. The business pays a $400 equipment deposit and $500 service charge for its first month of high-speed commercial internet service. 3. The business pays a retainer of $2,000 to an attorney for legal counsel. 4. The business receives $8,000 as payment in full at the time of its first sale. For each statement about the transactions in the first quarter, select ONLY the statements that are TRUE. Multiple answers may be selected.

The business should record an Expense of $500 for Utilities-Internet.

The business should record a Legal Expense of $2,000.

The business should record Revenue of $8,000.

The business should record Revenue of $10,000 with a debit to Cash.

You are reconciling a checking account. Several checks that were written over the past three weeks have not cleared the bank as of the closing period date. What should you do?

Take no action so that the checks correctly impact the account balance.

Void the uncleared checks and reenter them when they clear the bank.

Move the checks to a liability account named "Uncleared Checks in Transit".

Void the uncleared checks and reissue them to the vendor.

What is the purpose of a Balance Sheet?

To determine the financial health of an organization at a point in time.

To determine the difference between the banks and the current profitability from cash received.

To determine the year over year growth in sales over time.

To determine the profitability of the business during a period of time

Review the Balance Sheet shown in the image provided. You write a check for $10,000 to a vendor for costs related to the annual company party. The bill was previously recorded in Accounts Payable. Which TWO statements about the effect on the Balance Sheet are TRUE? (Select TWO.)

Total Stockholders Equity decreases to $361,000.

Accounts Payable increases to $34,000.

Which THREE statements are valid reasons for making adjusting journal entries? (Choose THREE)

To record expiration for prepaid insurance.

To recognize unpaid salaries for the current pay period.

To ensure Accounts Receivable matches Accounts Payable.

For each statement about depreciation select ONLY the statements that are TRUE . ( More than one answer may be selected.)

All fixed assets depreciate over the same useful life.

If a fixed asset with no salvage value is held for its estimated useful life, the entire cost would be expensed.

The accumulated depreciation account appears on the Income Statement.

A company may use one asset depreciation for bookkeeping purposes and a different method for tax purposes.

For each statement about liabilities select ONLY the statements that are TRUE . ( More than one answer may be selected.)

A liability is any future financial obligation of the business to an outside entity.

The owners of a business have the sole claim to the business assets if the business has no liabilities.

A business creates a liability when it purchases equipment using its own cash.

INTUIT Certified Bookkeeping Professional

Authored by Robyn Sanders

Business

12th Grade

Used 123+ times

INTUIT Certified Bookkeeping Professional

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MULTIPLE SELECT QUESTION

1 min • 1 pt

You are the bookkeeper for a new partnership that operates a car wash. The business has two equal partners, Mr Parker and Ms Patel. Each partner contributed $100,000 to start the business. The business also took out a Note Payable from the bank for $100,000. Read each statement below and identify which statements are true. More than one answer may be selected.

Cash should be debited for $300,000.

Notes Payable should be credited for$100,000.

Contribution-Parker & Contribution-Patel should each be credited $100,000.

Equity is the partners' paid in capital plus the value of the Note Payable.

MULTIPLE CHOICE QUESTION

1 min • 1 pt

You attempt to reconcile a company's bank accounts. There is a difference of $81.00 between the bank statements ending balance and the book balance. You cannot locate an $81.00 transaction. You need to complete the reconciliation. What should you do first?

Because the difference is a multiple of 9, look for transcription errors.

Create a Journal Entry against Retained Earnings to force the bank balance to match and generate a difference of zero during the reconciliation process.

Leave the reconciliation process for this period and hope that it will work for the next period

Restart the reconciliation process from the beginning.

MULTIPLE SELECT QUESTION

1 min • 1 pt

Select the accounts that appear on an Income Statement. More than one answer may be selected.

Accounts Payable

Cash

Cost of Goods Sold

Rent Expense

MULTIPLE SELECT QUESTION

1 min • 1 pt

Select the accounts that appear on a Balance Sheet. More than one answer may be selected.

Accounts Payable

Cash

Cost of Goods Sold

Rent Expense

MULTIPLE CHOICE QUESTION

1 min • 1 pt

You are a bookkeeper for a wholesale company that uses the FIFO inventory valuation method. The company makes the widget purchases shown in the chart. In June, the company sells 400 widgets at $200 per unit.

$100 Per Unit

$110 Per Unit

$113.33 Per Unit

$120 Per Unit

MULTIPLE CHOICE QUESTION

1 min • 1 pt

Which Accounting Equation is correct?

Assets+Equity=Liabilities

Assets+Liabilities =Equity

Assets=Equity-Liabilities

Assets =Liabilities+Equity

MULTIPLE SELECT QUESTION

1 min • 1 pt

Read each statement about the advantages of software-based double-entry bookkeeping systems. Select only the statements that are TRUE! More than one answer may be selected.

The software will prevent all fraud.

The software should prevent arithmetic errors.

The software should allow transactions to be saved only if the debit and credit entries are equal.

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INTUIT Certified Bookkeeping Professional

You attempt to reconcile a company's bank accounts. There is a difference of $81.00 between the bank statements ending balance and the book balance. You cannot locate an $81.00 transaction. You need to complete the reconciliation. What should you do first?

Select the accounts that appear on an Income Statement. More than one answer may be selected.

Select the accounts that appear on a Balance Sheet. More than one answer may be selected.

You are a bookkeeper for a wholesale company that uses the FIFO inventory valuation method. The company makes the widget purchases shown in the chart. In June, the company sells 400 widgets at $200 per unit.

Which Accounting Equation is correct?

Read each statement about the advantages of software-based double-entry bookkeeping systems. Select only the statements that are TRUE! More than one answer may be selected.

Which TWO accounts should be reconciled monthly? More than one answer may be selected.

Which of the following are characteristics of the Cash Basis of Accounting? More than one answer may be selected.

Which of the following are characteristics of the Accrual Basis of Accounting? More than one answer may be selected.

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