Peregrine Exam questions with correct |\ |\ |\ |\ |\
answers
What is a general ledger? - CORRECT ANSWERS ✔✔A general
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ledger account is an account or record used to sort, store and
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
summarize a company's transactions. |\ |\ |\
asset accounts such as Cash, Accounts Receivable, Inventory,
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Investments, Land, and Equipment |\ |\ |\
liability accounts including Notes Payable, Accounts Payable,
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Accrued Expenses Payable, and Customer Deposits
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stockholders' equity accounts such as Common Stock, Retained
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Earnings, Treasury Stock, and Accumulated Other Comprehensive
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Income
What is the difference between accounts payable and accounts
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receivable? - CORRECT ANSWERS ✔✔Accounts payable is a current
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liability account in which a company records the amounts it owes
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to suppliers or vendors for goods or services that it received on
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credit.
Accounts receivable is a current asset account in which a company
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records the amounts it has a right to collect from customers who
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received goods or services on credit.
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, What is the cost of goods sold? - CORRECT ANSWERS ✔✔The cost
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of goods sold is the cost of the products that a retailer, distributor,
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or manufacturer has sold.
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What is owner's equity? - CORRECT ANSWERS ✔✔Owner's equity
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is one of the three main sections of a sole proprietorship's balance
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sheet and one of the components of the accounting equation:
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Assets = Liabilities + Owner's Equity.
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What is principles of accounting? - CORRECT ANSWERS
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✔✔Principles of accounting can also refer to the basic or |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
fundamental accounting principles: cost principles, matching |\ |\ |\ |\ |\ |\
principles, full disclosure principles, materiality principles, going
|\ |\ |\ |\ |\ |\ |\
concern principles, economic entity principles, and so on. In this
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
context, principles of accounting refers to the broad underlying
|\ |\ |\ |\ |\ |\ |\ |\ |\
concepts which guide accountants when preparing financial
|\ |\ |\ |\ |\ |\ |\
statements.
What is equity? - CORRECT ANSWERS ✔✔Equity can indicate an
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ownership interest in a business, such as stockholders' equity or
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
owner's equity. |\
Equity can mean an owner's interest in a personal asset. For
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
example, the owner of a $200,000 house that has a mortgage loan
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of $75,000 is said to have $125,000 of equity in the house.
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What is meant by reconciling an account? - CORRECT ANSWERS
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✔✔Reconciling an account is likely to mean proving or |\ |\ |\ |\ |\ |\ |\ |\ |\
documenting that an account balance is correct. |\ |\ |\ |\ |\ |\
answers
What is a general ledger? - CORRECT ANSWERS ✔✔A general
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
ledger account is an account or record used to sort, store and
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
summarize a company's transactions. |\ |\ |\
asset accounts such as Cash, Accounts Receivable, Inventory,
|\ |\ |\ |\ |\ |\ |\ |\
Investments, Land, and Equipment |\ |\ |\
liability accounts including Notes Payable, Accounts Payable,
|\ |\ |\ |\ |\ |\ |\
Accrued Expenses Payable, and Customer Deposits
|\ |\ |\ |\ |\
stockholders' equity accounts such as Common Stock, Retained
|\ |\ |\ |\ |\ |\ |\ |\
Earnings, Treasury Stock, and Accumulated Other Comprehensive
|\ |\ |\ |\ |\ |\ |\
Income
What is the difference between accounts payable and accounts
|\ |\ |\ |\ |\ |\ |\ |\ |\
receivable? - CORRECT ANSWERS ✔✔Accounts payable is a current
|\ |\ |\ |\ |\ |\ |\ |\
liability account in which a company records the amounts it owes
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
to suppliers or vendors for goods or services that it received on
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
credit.
Accounts receivable is a current asset account in which a company
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
records the amounts it has a right to collect from customers who
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
received goods or services on credit.
|\ |\ |\ |\ |\
, What is the cost of goods sold? - CORRECT ANSWERS ✔✔The cost
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
of goods sold is the cost of the products that a retailer, distributor,
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
or manufacturer has sold.
|\ |\ |\
What is owner's equity? - CORRECT ANSWERS ✔✔Owner's equity
|\ |\ |\ |\ |\ |\ |\ |\ |\
is one of the three main sections of a sole proprietorship's balance
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
sheet and one of the components of the accounting equation:
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
Assets = Liabilities + Owner's Equity.
|\ |\ |\ |\ |\
What is principles of accounting? - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\
✔✔Principles of accounting can also refer to the basic or |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
fundamental accounting principles: cost principles, matching |\ |\ |\ |\ |\ |\
principles, full disclosure principles, materiality principles, going
|\ |\ |\ |\ |\ |\ |\
concern principles, economic entity principles, and so on. In this
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
context, principles of accounting refers to the broad underlying
|\ |\ |\ |\ |\ |\ |\ |\ |\
concepts which guide accountants when preparing financial
|\ |\ |\ |\ |\ |\ |\
statements.
What is equity? - CORRECT ANSWERS ✔✔Equity can indicate an
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
ownership interest in a business, such as stockholders' equity or
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
owner's equity. |\
Equity can mean an owner's interest in a personal asset. For
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
example, the owner of a $200,000 house that has a mortgage loan
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
of $75,000 is said to have $125,000 of equity in the house.
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
What is meant by reconciling an account? - CORRECT ANSWERS
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
✔✔Reconciling an account is likely to mean proving or |\ |\ |\ |\ |\ |\ |\ |\ |\
documenting that an account balance is correct. |\ |\ |\ |\ |\ |\
