INTRODUCTION TO BOOKKEEPING
REVIEW EXAM QUESTIONS WITH
COMPLETE SOLUTIONS 2024
Bookkeeper Basic Function - ANSWER-The bookkeeper position creates financial
transactions and creates financial reports from that information. The creation of financial
transactions includes posting information to accounting journals or accounting software
from such source documents as invoices to customers, cash receipts, and supplier
invoices. The bookkeeper also reconciles accounts to ensure their accuracy.
Bookkeeping - ANSWER-how you record and report on the financial transactions of a
business.
What Is a Certified Public Accountant? - ANSWER-A certified public accountant (CPA)
is an accountant who has passed all parts of the CPA examination, as administered by
the American Institute of Certified Public Accountants, and who has also completed all
additional work and educational requirements of their local state accounting regulatory
agencies. A CPA is authorized to render an opinion on the fairness of a client's financial
statements.
Generally accepted accounting principles (GAAP) - ANSWER-accounting guidelines
that govern the content and form of financial reports
International Financial Reporting Standards (IFRS) - ANSWER-A set of global
accounting guidelines, formulated by the International Accounting Standards Board
(IASB).
Income Statement - ANSWER-a financial report that summarizes an entity's rev- enue,
cost of goods sold, gross margin, other costs, tax expense, and net income or loss over
a specific time period
Revenue - ANSWER-an increase in assets or decrease in liabilities
Cost of goods sold - ANSWER-the accumulated total of all costs used to create a
product or service that has been sold. These costs fall into the general subcategories of
direct labor, materials, and overhead.
Gross margin - ANSWER-revenues less the cost of goods sold. The gross margin
reveals the amount that an entity earns from the sale of its products and services,
before the deduction of any sales and administrative expenses.
Expense - ANSWER-the reduction in value of an asset as it is used to generate
revenue.
REVIEW EXAM QUESTIONS WITH
COMPLETE SOLUTIONS 2024
Bookkeeper Basic Function - ANSWER-The bookkeeper position creates financial
transactions and creates financial reports from that information. The creation of financial
transactions includes posting information to accounting journals or accounting software
from such source documents as invoices to customers, cash receipts, and supplier
invoices. The bookkeeper also reconciles accounts to ensure their accuracy.
Bookkeeping - ANSWER-how you record and report on the financial transactions of a
business.
What Is a Certified Public Accountant? - ANSWER-A certified public accountant (CPA)
is an accountant who has passed all parts of the CPA examination, as administered by
the American Institute of Certified Public Accountants, and who has also completed all
additional work and educational requirements of their local state accounting regulatory
agencies. A CPA is authorized to render an opinion on the fairness of a client's financial
statements.
Generally accepted accounting principles (GAAP) - ANSWER-accounting guidelines
that govern the content and form of financial reports
International Financial Reporting Standards (IFRS) - ANSWER-A set of global
accounting guidelines, formulated by the International Accounting Standards Board
(IASB).
Income Statement - ANSWER-a financial report that summarizes an entity's rev- enue,
cost of goods sold, gross margin, other costs, tax expense, and net income or loss over
a specific time period
Revenue - ANSWER-an increase in assets or decrease in liabilities
Cost of goods sold - ANSWER-the accumulated total of all costs used to create a
product or service that has been sold. These costs fall into the general subcategories of
direct labor, materials, and overhead.
Gross margin - ANSWER-revenues less the cost of goods sold. The gross margin
reveals the amount that an entity earns from the sale of its products and services,
before the deduction of any sales and administrative expenses.
Expense - ANSWER-the reduction in value of an asset as it is used to generate
revenue.
