ccounting)Questions &AnswersQuickBooks Certification Practice Exam (Basic Accounting)Questions &Answers

What is one way that QuickBooks uses the Account Type? a. To track revenue and expense by office or business segment b. For financial ratios in the Analysis module c. To change the color of different sections on the financial statements d. To identify where the account appears on the financial statements -ANSWER - d. To identify where the account appears on the financial statements This is the correct answer. The first set of accounts appear on the Balance Sheet (Assets, Liabilities and Equity). Then the next types of accounts appear on the Profit & Loss Statement (Income, Cost of Goods Sold, and Expenses). What does the term "Double-entry accounting" mean? a. That the Income and Expense accounts are always part of every transaction. b. There are always at least two accounts involved in every financial transaction. c. That the Cost of Goods Sold account and the Liabilities account are always part of a transaction. d. The Equity and Asset accounts are always involved in a transaction. -ANSWER - b. There are always at least two accounts involved in every financial transaction. This is the correct answer. Debits must equal credits, so for every transaction, there is a source and a use. What is the purpose of the Chart of Accounts? a. It allows accountants to view accounting records remotely. b. It is how you categorize financial transactions. c. To see a graphical chart of income and expenses. d. To categorize items. -ANSWER - b. It is how you categorize financial transactions. This is the correct answer. The Chart of Accounts is a way to label or categorize all the money/value that comes into a business, all the money/value that goes out, and all the money that is transferred between different categories. You suspect that someone has changed a transaction. What report should you run? a. Audit Trail Report b. User Entry Report c. Modified Transactions Report d. Changed Transactions Report -ANSWER - a. Audit Trail Report This is the correct answer. The audit trail shows you transactions that have been added, edited, and deleted. It also shows you the original transaction and who changed the transaction, as well as the exact date and time. How can you stop yourself and others from deleting, editing, or adding transactions in a closed period? a. Start a new company file each period (fiscal year) b. Change the fiscal year in the Company Information window c. Set a closing date