Accounting Midterm - Period 4 Test

Nora is considering a career path and wants to know which of the following best describes an accounting career?

• Accountants only work on taxes

• Focuses on maintaining financial records and ensuring accuracy

• Focuses on increasing sales and setting the correct pricing

• Focuses in inventory management

What is the initial phase in the accounting process?

• Drafting the financial statements

• Initiating the general journal

• Gathering and verifying source documents

• Compiling the trial balance

Which of the following is a liability that would be reported on the Balance Sheet?

• Interest Income

• Accounts Receivable

• Accounts Payable

• Operating Expenses

Lily is reviewing the financial statements of her family business. What does the balance sheet report?

• A company’s revenues and expenses over a period

• A company’s cash flow activities

• Things of value in other words, A company’s assets, liabilities, and shareholders' equity at a specific point in time

• A company’s net income for the period

Which of the following items is not found on an income statement?

• Sales Revenue

• Operating Expenses

• Net Profit

• Liabilities

What is a common feature of a checking account?

• Offers higher interest rates than savings accounts

• Primarily used for accumulating savings over time

• Facilitates easy transactions like cash withdrawals, ATM usage, online debit card payments, or transfers via apps like Cash App.

• Funds are invested in the Stock Market for faster growth

Kai is planning to save money for his future goals. Which of the following best describes the type of account he should consider?

• Savings Accounts

• Checking Account

• Cash App/Venmo Acct

• Certificate of Deposit

What is the primary purpose of a cash account on the Balance Sheet ?

• To manage a company's long-term investments

• To handle short-term cash transactions and liquidity

• To oversee the company's equity and shareholder distributions

• To track depreciation of assets

Kai is managing the office supplies budget. Which of the following is considered an expense?

• A large sell

• Purchase of a new building

• Printer paper for the office

• A cash donation

What is a primary function of QuickBooks?

• It is an Accounting System used for managing tasks, creating financial reports, and maintaining accounting records

• It is exclusively for designing business cards

• It is a tool for editing videos

• Still Not Sure