BOOKKEEPING CH #1-6 REVIEW EXAM QUESTIONS AND ANSWERS

BOOKKEEPING CH #1-6 REVIEW EXAM QUESTIONS AND ANSWERS Revenue accounts (P. 93) - ANSWER-First up in the income statement portion of the Chart of Accounts are accounts that track revenue coming into the business. The most common income accounts are: - Sales of Goods or Services - Sales Discounts - Sale returns Other income accounts that may appear include: 1. Other income 2. Interest Income 3. Sale of Fixed Assets Tracking Cost of Sales - ANSWER-Before you can sell a product, you must spend some money to either buy or make that product. The type of account used to track the money spent is called a Cost of Goods Sold account. The most common Cost of Goods Sold accounts are: 1. Purchases 2. Purchase Discount 3. Purchase returns 4. Freight Charges 5. Other Sales Costs Expense accounts (p.96) - ANSWER-On your Chart of Accounts, the expense accounts don't have to appear in any specific order. The most common expense accounts are: 1. Advertising 2. Bank Service Charges 3. Dues and Subscriptions 4. Equipment rental 5. Insurance 6. Legal and Accounting 7. Miscellaneous expenses 8. Office expense 9. Payroll taxes 10 Postage 11. Rent expense 12. Salaries and Wages 13. Supplies 14. Travel and Entertainment 15. Telephone 16. Utilities 17. Vehicles