Payroll accounting and reports exam
questions and answers
The framework of an accounting system is the accounting equation,
which, in the case of a sole proprietor, is as follows: -
correct answer ✅ASSETS = LIABILITIES + OWNER'S EQUITY
Example: (Assets) $100,000 = (Liabilities) $50,000 + (Owner's
Equity) $50,000
debit-credit rule -
correct answer ✅for every credit, there must be an equal and
opposite debit; for every debit, there must be an equal and
opposite credit.
debit increases either an asset or an expense account or decreases
a liability or an equity account. A credit decreases either an asset or
an expense account or increases a liability or an equity account -
correct answer ✅True
For any monetary transaction, checking to make sure the debit side
matches the credit side is the primary accounting control. -
correct answer ✅True
,Payroll accounting and reports exam
questions and answers
a journal entry may include the following: -
correct answer ✅The date of entry
A unique number that identifies the journal entry
The current accounting period
The name of the person making the entry
Any managerial authorizations
Documentation to justify the journal entry
Two special kinds of journal entries can be useful in payroll
accounting. -
correct answer ✅reversing journal entry
recurring entry
, Payroll accounting and reports exam
questions and answers
A reversing journal entry -
correct answer ✅Journal entry that automatically reverses the
accrual on the first day of the following month.
recurring entry -
correct answer ✅A feature that automates recurring journal
entries, such as entries for depreciation, amortization, and accrued
liabilities.
can be entered manually or via accounting software in each
successive accounting period.
recurring expense -
correct answer ✅any cost incurred on a regular basis.
may be something like group term life insurance.
The primary financial statements are the balance sheet and the
income statement (also called the profit and loss statement). -
correct answer ✅True
questions and answers
The framework of an accounting system is the accounting equation,
which, in the case of a sole proprietor, is as follows: -
correct answer ✅ASSETS = LIABILITIES + OWNER'S EQUITY
Example: (Assets) $100,000 = (Liabilities) $50,000 + (Owner's
Equity) $50,000
debit-credit rule -
correct answer ✅for every credit, there must be an equal and
opposite debit; for every debit, there must be an equal and
opposite credit.
debit increases either an asset or an expense account or decreases
a liability or an equity account. A credit decreases either an asset or
an expense account or increases a liability or an equity account -
correct answer ✅True
For any monetary transaction, checking to make sure the debit side
matches the credit side is the primary accounting control. -
correct answer ✅True
,Payroll accounting and reports exam
questions and answers
a journal entry may include the following: -
correct answer ✅The date of entry
A unique number that identifies the journal entry
The current accounting period
The name of the person making the entry
Any managerial authorizations
Documentation to justify the journal entry
Two special kinds of journal entries can be useful in payroll
accounting. -
correct answer ✅reversing journal entry
recurring entry
, Payroll accounting and reports exam
questions and answers
A reversing journal entry -
correct answer ✅Journal entry that automatically reverses the
accrual on the first day of the following month.
recurring entry -
correct answer ✅A feature that automates recurring journal
entries, such as entries for depreciation, amortization, and accrued
liabilities.
can be entered manually or via accounting software in each
successive accounting period.
recurring expense -
correct answer ✅any cost incurred on a regular basis.
may be something like group term life insurance.
The primary financial statements are the balance sheet and the
income statement (also called the profit and loss statement). -
correct answer ✅True
