Bookkeeping Certification Practice Test
Exam UPDATED QUESTIONS AND
CORRECT ANSWERS
Springville Distributors made sales using a list prie of $880 and a trade discount of 30%.
What amount should be recorded for the sale?
A) $594
B) $216
C) $264
D) $616 - CORRECT ANSWER D
Laws passed by Congress in 1933 and 1934 gave the Securities and Exchange Commission
(SEC) final say on matters of financial reporting by publicly owned corporations.
A) True
B) False - CORRECT ANSWER A
When equipment is purchased for cash,
A) one asset increases and another asset decreases
B) assets decrease and expenses increase
C) assets and owner's equity increase
D) assets increase and liabilities decrease - CORRECT ANSWER A
Tax planning is any activity associated with the preparation of tax returns and the audit of
those returns.
A) True
B) False - CORRECT ANSWER B
The frequency of deposits of federal income taxes withheld and social security and Medicare
taxes is determined by the amount owed.
A) True
, B) False - CORRECT ANSWER A
Which of the following is not a reason why the book balance of cash may not agree with the
balance on the bank statement?
A) Outstanding checks
B) End of the month
C) Service charges and other deductions
D) Deposit in transit - CORRECT ANSWER B
Most cash transactions involve checks.
A) True
B) False - CORRECT ANSWER A
The entry to transfer a net loss to the owner's capital account would include a debit to
A) the owner's capital account and a credit to Income Summary
B) the owner's capital account and a credit to Cash
C) Income Summary and a credit to the owner's capital account
D) the owner's drawing account and a credit to the owner's capital account - CORRECT
ANSWER A
The maximum base for the social security tax is the same as that of the Medicare tax.
A) True
B) False - CORRECT ANSWER B
A subsidiary ledger is a ledger that contains accounts of a single type.
A) True
B) False - CORRECT ANSWER A
Exam UPDATED QUESTIONS AND
CORRECT ANSWERS
Springville Distributors made sales using a list prie of $880 and a trade discount of 30%.
What amount should be recorded for the sale?
A) $594
B) $216
C) $264
D) $616 - CORRECT ANSWER D
Laws passed by Congress in 1933 and 1934 gave the Securities and Exchange Commission
(SEC) final say on matters of financial reporting by publicly owned corporations.
A) True
B) False - CORRECT ANSWER A
When equipment is purchased for cash,
A) one asset increases and another asset decreases
B) assets decrease and expenses increase
C) assets and owner's equity increase
D) assets increase and liabilities decrease - CORRECT ANSWER A
Tax planning is any activity associated with the preparation of tax returns and the audit of
those returns.
A) True
B) False - CORRECT ANSWER B
The frequency of deposits of federal income taxes withheld and social security and Medicare
taxes is determined by the amount owed.
A) True
, B) False - CORRECT ANSWER A
Which of the following is not a reason why the book balance of cash may not agree with the
balance on the bank statement?
A) Outstanding checks
B) End of the month
C) Service charges and other deductions
D) Deposit in transit - CORRECT ANSWER B
Most cash transactions involve checks.
A) True
B) False - CORRECT ANSWER A
The entry to transfer a net loss to the owner's capital account would include a debit to
A) the owner's capital account and a credit to Income Summary
B) the owner's capital account and a credit to Cash
C) Income Summary and a credit to the owner's capital account
D) the owner's drawing account and a credit to the owner's capital account - CORRECT
ANSWER A
The maximum base for the social security tax is the same as that of the Medicare tax.
A) True
B) False - CORRECT ANSWER B
A subsidiary ledger is a ledger that contains accounts of a single type.
A) True
B) False - CORRECT ANSWER A
