PEREGRINE ACADEMIC SERVICES
Business & Management Competency Assessment
PEREGRINE EXAM
COMPREHENSIVE STUDY GUIDE
Questions, Answers & Detailed Explanations
Business | Economics | Law | Management | Marketing
Topics Covered in This Study Guide:
Accounting & Finance | Economics | Management Strategy
Marketing | Human Resources | Business Law & Ethics
Information Technology | Leadership | International Business
200+ Items 9 Sections Full Explanations
Study Questions Topic Areas For Every Answer
For Educational Purposes Only | Peregrine Exam Study Guide
Business & Management Competency Review
, TABLE OF CONTENTS
SECTION 1: Accounting & Finance (28 items, Q1–Q28)
PEREGRINE
SECTION 2: Economics (26 items, Q29–Q54) ACADEMIC SERVICES
Business & Management Competency Assessment
SECTION 3: Management & Strategy (13 items, Q55–Q67)
SECTION 4: Marketing (11 items, Q68–Q78)
SECTION 5: Human Resources Management (15 items, Q79–Q93)
SECTION 6: Business Law & Ethics (23 items, Q94–Q116)
SECTION 7: Information Technology & Statistics (20 items, Q117–Q136)
SECTION 8: Leadership & Organizational Behavior (11 items, Q137–Q147)
SECTION 9: International Business & Trade (5 items, Q148–Q152)
Total Items: 152 | 9 Subject Sections | Complete Explanations Included
PEREGRINE EXAM
COMPREHENSIVE STUDY GUIDE
Questions, Answers & Detailed Explanations
Business | Economics | Law | Management | Marketing
Topics Covered in This Study Guide:
Accounting & Finance | Economics | Management Strategy
Marketing | Human Resources | Business Law & Ethics
Information Technology | Leadership | International Business
200+ Items 9 Sections Full Explanations
Study Questions Topic Areas For Every Answer
For Educational Purposes Only | Peregrine Exam Study Guide
Business & Management Competency Review
, PEREGRINE EXAM | STUDY GUIDE Page 3
SECTION 1: Accounting & Finance
Q1. What is a general ledger?
ANSWER:
A general ledger is an account or record used to sort, store and summarize a company's transactions. It includes asset
accounts (Cash, Accounts Receivable, Inventory, Land, Equipment), liability accounts (Notes Payable, Accounts Payable,
Accrued Expenses Payable), and stockholders' equity accounts (Common Stock, Retained Earnings, Treasury Stock).
Q2. What is the difference between accounts payable and accounts receivable?
ANSWER:
Accounts payable is a current liability account in which a company records the amounts it owes to suppliers or vendors for
goods or services 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.
Q3. What is the cost of goods sold?
ANSWER:
The cost of goods sold is the cost of the products that a retailer, distributor, or manufacturer has sold. It is the total cost of
merchandise sold during a period.
Q4. What is owner's equity?
ANSWER:
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.
Q5. What is principles of accounting?
ANSWER:
Principles of accounting refers to the broad underlying concepts which guide accountants when preparing financial
statements: cost principle, matching principle, full disclosure principle, materiality principle, going concern principle,
economic entity principle, and others.
Q6. What is equity?
ANSWER:
Equity can indicate an ownership interest in a business, such as stockholders' equity or owner's equity. For example, a
$200,000 house with a $75,000 mortgage has $125,000 of equity.
Q7. What is meant by reconciling an account?
ANSWER:
Reconciling an account means proving or documenting that an account balance is correct.
Q8. What is included in cash and cash equivalents?
ANSWER:
Cash includes currency and coins, checks received from customers but not yet deposited, checking accounts, and petty
cash. Cash equivalents are short-term, highly liquid investments with a maturity date of 3 months or less at the time of
purchase — such as money market accounts, U.S. Treasury Bills, and commercial paper.
Peregrine Exam Study Guide — For Educational Purposes Only
Business & Management Competency Assessment
PEREGRINE EXAM
COMPREHENSIVE STUDY GUIDE
Questions, Answers & Detailed Explanations
Business | Economics | Law | Management | Marketing
Topics Covered in This Study Guide:
Accounting & Finance | Economics | Management Strategy
Marketing | Human Resources | Business Law & Ethics
Information Technology | Leadership | International Business
200+ Items 9 Sections Full Explanations
Study Questions Topic Areas For Every Answer
For Educational Purposes Only | Peregrine Exam Study Guide
Business & Management Competency Review
, TABLE OF CONTENTS
SECTION 1: Accounting & Finance (28 items, Q1–Q28)
PEREGRINE
SECTION 2: Economics (26 items, Q29–Q54) ACADEMIC SERVICES
Business & Management Competency Assessment
SECTION 3: Management & Strategy (13 items, Q55–Q67)
SECTION 4: Marketing (11 items, Q68–Q78)
SECTION 5: Human Resources Management (15 items, Q79–Q93)
SECTION 6: Business Law & Ethics (23 items, Q94–Q116)
SECTION 7: Information Technology & Statistics (20 items, Q117–Q136)
SECTION 8: Leadership & Organizational Behavior (11 items, Q137–Q147)
SECTION 9: International Business & Trade (5 items, Q148–Q152)
Total Items: 152 | 9 Subject Sections | Complete Explanations Included
PEREGRINE EXAM
COMPREHENSIVE STUDY GUIDE
Questions, Answers & Detailed Explanations
Business | Economics | Law | Management | Marketing
Topics Covered in This Study Guide:
Accounting & Finance | Economics | Management Strategy
Marketing | Human Resources | Business Law & Ethics
Information Technology | Leadership | International Business
200+ Items 9 Sections Full Explanations
Study Questions Topic Areas For Every Answer
For Educational Purposes Only | Peregrine Exam Study Guide
Business & Management Competency Review
, PEREGRINE EXAM | STUDY GUIDE Page 3
SECTION 1: Accounting & Finance
Q1. What is a general ledger?
ANSWER:
A general ledger is an account or record used to sort, store and summarize a company's transactions. It includes asset
accounts (Cash, Accounts Receivable, Inventory, Land, Equipment), liability accounts (Notes Payable, Accounts Payable,
Accrued Expenses Payable), and stockholders' equity accounts (Common Stock, Retained Earnings, Treasury Stock).
Q2. What is the difference between accounts payable and accounts receivable?
ANSWER:
Accounts payable is a current liability account in which a company records the amounts it owes to suppliers or vendors for
goods or services 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.
Q3. What is the cost of goods sold?
ANSWER:
The cost of goods sold is the cost of the products that a retailer, distributor, or manufacturer has sold. It is the total cost of
merchandise sold during a period.
Q4. What is owner's equity?
ANSWER:
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.
Q5. What is principles of accounting?
ANSWER:
Principles of accounting refers to the broad underlying concepts which guide accountants when preparing financial
statements: cost principle, matching principle, full disclosure principle, materiality principle, going concern principle,
economic entity principle, and others.
Q6. What is equity?
ANSWER:
Equity can indicate an ownership interest in a business, such as stockholders' equity or owner's equity. For example, a
$200,000 house with a $75,000 mortgage has $125,000 of equity.
Q7. What is meant by reconciling an account?
ANSWER:
Reconciling an account means proving or documenting that an account balance is correct.
Q8. What is included in cash and cash equivalents?
ANSWER:
Cash includes currency and coins, checks received from customers but not yet deposited, checking accounts, and petty
cash. Cash equivalents are short-term, highly liquid investments with a maturity date of 3 months or less at the time of
purchase — such as money market accounts, U.S. Treasury Bills, and commercial paper.
Peregrine Exam Study Guide — For Educational Purposes Only
