DIT-Bookkeeping Exam Study guide
When should a company adjust its inventory balance? - Answer -When the physical
count does not match inventory balance on the books.
What is FICA - Answer -It is a combination of Social Security, and Medicare taxes
What test displays previous financials in side-by-side columns, enabling investors to
identify trends, track a company's progress and compare it with industry rivals? -
Answer -A comparative income statement
When you subtract COGS from sales revenue, what do you get in return? - Answer -
Gross Profit
What are some variants of the accounting equation? - Answer -A=L+E
E=A-L
L=A-E
When reading a journal that was generated by the accounting software, what should
you expect to find? - Answer -Date, description account name, and amount
What is the natural balance of Revenue? - Answer -credit
What is the natural balance of liabilities? - Answer -credit
What is the natural balance of stockholder's equity? - Answer -Credit
What is the natural balance of assets? - Answer -debit
What is the natural balance of expenses? - Answer -debit
What is the 1st step of the accounting cycle? - Answer -Identify transactions
What is the 2nd step in the accounting cycle? - Answer -Record transactions as journal
entries
What is the 3rd step in the accounting cycle? - Answer -Post entries to the general
ledger
When should a company adjust its inventory balance? - Answer -When the physical
count does not match inventory balance on the books.
What is FICA - Answer -It is a combination of Social Security, and Medicare taxes
What test displays previous financials in side-by-side columns, enabling investors to
identify trends, track a company's progress and compare it with industry rivals? -
Answer -A comparative income statement
When you subtract COGS from sales revenue, what do you get in return? - Answer -
Gross Profit
What are some variants of the accounting equation? - Answer -A=L+E
E=A-L
L=A-E
When reading a journal that was generated by the accounting software, what should
you expect to find? - Answer -Date, description account name, and amount
What is the natural balance of Revenue? - Answer -credit
What is the natural balance of liabilities? - Answer -credit
What is the natural balance of stockholder's equity? - Answer -Credit
What is the natural balance of assets? - Answer -debit
What is the natural balance of expenses? - Answer -debit
What is the 1st step of the accounting cycle? - Answer -Identify transactions
What is the 2nd step in the accounting cycle? - Answer -Record transactions as journal
entries
What is the 3rd step in the accounting cycle? - Answer -Post entries to the general
ledger
