| 5 - A company wants to record service revenue of $5,350 earned but not yet received. What is the best way to record this transaction using accounting software? a) a journal entry b) Directly into the income statement c) no entry should be recorded d) the check register 6 - A company paid $1,700 for office supplies. What is the best way to record this transaction using accounting software? a) a journal entry b) an adjusting entry c) the check register d) Directly into the income statement | 7 -The owner withdrawals $5,000 cash for his personal use. What is the best way to record this transaction using accounting software? a) a journal entry b) an adjusting entry c) directly into the balance sheet d) the check register 8 - Rowan Inc. has one employee with a salary of $2,000 per pay period. FICA Social Security taxes are 6.2% and FICA Medicare taxes are 1.45% of gross pay. What additional information is needed to pay this employee using accounting software? a) Hours worked b) Information contained on the W-4 c) Rate of pay per hour d) All of the above | 9 -The following are examples of source documents that can be used to enter transactions into accounting software,except: a) Balance Sheet b) Bank Statement c) Purchase Order d) Sales Ticket 10 - Posting from journals to ledgers in accounting software is a) a very long process taking several hours to ensure accuracy b) Done automatically c) done manually at the end of the accounting cycle d) replaced by statement of accounts and cash balances report | 11 - A company calculated depreciation of $4,200 on all plant assets at year end. What is the best way to record this transaction using accounting software? a) A journal entry b) Directly into the income statement c) no entry should be recorded d) the check register 12 - A company prepaid 3 years of insurance on January 1, 2xx1 for $3,000. The accountant is getting ready to complete year-end adjustments. What is the best way to record this transaction using accounting software? a) A journal entry b) directly into the balance sheet c) Directly into the income statement d) no entry should be recorded | 13 - A company thinks it may lose money next year of $3,000. The accountant is getting ready to complete the year-end adjustments. What is the best way to record this transaction using accounting software? a) A journal entry b) directly into the balance sheet c) Directly into the income statement d) no entry should be recorded | 14 - When using accounting software, at year-end to prepare financial statements at year-end, you have to: a) Prepare the statement of cash flow first to transfer the ending cash balance to the balance sheet in a journal entry b) Prepare the income statement first to transfer net income to the balance sheet in a journal entry c) prepare the balance sheet first to transfer total equity to the statement of cash flow in a journal d) do nothing, the financial statements are prepared automatically | 15 - When using accounting software, at year-end to prepare adjusting entries at year-end, you have to: a) Prepare the balance sheet then prepare the trial balance to adjust prepaid and unearned accounts b) Prepare the entries just as you did in a manual system c) Prepare the income statement first to transfer net income to the balance sheet in a journal entry. The rest of the journal entries are done automatically d) do nothing, the adjusting entries are prepared automatically | 16 - When a company prepares closing entries, it: a) Resets only the assets and liability accounts to zero at the end of each accounting period b) Resets only the Income Statement accounts to zero at the end of each accounting period c) Resets the assets, liability, and equity accounts to zero at the end of each accounting period d) Resets the revenue, expense, and withdrawal accounts to zero at the end of each accounting period 17 - When presenting financial information to a board of directors, it is best to provide: a) A list of increases and decreases in accounts over $10,000 b) A summary of the data and details when asked c) An access database along with the information prepared from the accounting software so the data can be compared for accuracy d) Details for each number on each day in a presentation format such as PowerPoint | 18 - When presenting financial information to banks and creditors it is best to provide: a) All financial information for the last 10 years b) Detailed cash transactions c) Only information that will guarantee the loan or credit with be approved d) Relevant financial information 19 - On December 31, 2xx1, the end of the fiscal year, Kelly's Consulting Services Firm booked a client for January of the next year, 2xx2. Wanting to record a profit in 2xx1, Kelly credits the Consulting Revenue account and debits Accounts Receivable for the expected revenue in 2xx2 on December 31, 2xx1 as a part of the year-end adjustments. This is an ethics violation because: a) The client agreed to pay in cash, not with a check in January b) The client was not aware of the transaction date of the entry c) the company recorded revenue that it has not yet earned d) There is not ethics violation because the company recorded accounts receivables, not cash | 20 - Ethically, accounting software should be used to: a) Provide a quicker way to keep accurate books and records b) Provide a way for management to meet investor expectations c) Create new reports to decrease revenue d) Create reports that do not follow GAAP | | | | | | | | | |
