Accounting Management

What is the primary role of Accounting Management in a software business?

• Ensuring financial stability and compliance

• Managing HR and payroll

• Developing new software products

• Handling customer support

Which revenue model generates predictable recurring income?

• Perpetual License

• Service Revenue

• Subscription-Based Revenue

• One-time Product Sales

How is deferred revenue recorded in financial statements?

• As an asset

• As a liability

• As revenue immediately

• As an expense

What is a key mistake in revenue recognition?

• Deferring revenue over time

• Separating service revenue from product revenue

• Recognizing upfront payments as immediate revenue

• Following GAAP accounting rules

Which cost is considered a direct cost in software development?

• Developer salaries

• Office rent

• Cloud hosting fees

• Marketing expenses

What is an example of an indirect cost in software development?

• Software development tools

• Third-party API costs

• Developer salaries

• Customer acquisition cost

When should software development costs be capitalized?

• When they provide long-term future benefits

• When they are used in routine maintenance

• When they relate to daily operational costs

• When they have no expected revenue impact

What happens if a company over-capitalizes costs?

• It understates its revenue

• It inflates its financial position

• It improves cash flow

• It has no impact on financial statements

What is the purpose of budgeting in a software business?

• To track employee performance

• To allocate resources effectively

• To increase marketing spend only

• To reduce developer salaries

How is Monthly Recurring Revenue (MRR) calculated?

• Total revenue / 12

• Annual revenue × 12

• Churn rate × Revenue

• Total customers × Monthly subscription fee