CSLB TEST 2 BUSINESS FINANCE EXAM QUESTIONS WITH DETAILED VERIFIED ANSWERS (100-

CSLBTEST2 BUSINESS FINANCE EXAM QUESTIONS v v v v v v




WITH DETAILED VERIFIED ANSWERS (100% v v v v v




CORRECT ANSWERS) A+ GRADE ASSURED v v v v v




All revenues minus all of the expenses refers to: - correct answer-net profit
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What can happen if payroll tax returns are not filed in a timely manner? - correct answer-
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Large penalties can be charged for late filings. According to the California Franchise Tax Board, an under
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payment penalty will be charged when taxes are not paidPby the due date. Interest will be charged on any
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delinquent or late payment from the original due date of the return to the date paid. In addition, if other pe
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nalties are not paid within 15 days of the date of the notice, interest will be charged from the date of the bi lling
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notice until the date of payment. Interest compounds daily and the interest rate is adjusted twice a ye ar.
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The two types of external financing available to a business are: - correct answer-
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Equity funds and debt.Equity funds are supplied by investors who acquire some control of the business an d a
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share of future profits. These funds remain in the business. Debt represents borrowed dollars that requ ire both
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repayment of the original amount and periodic interest payments. The owner does not normally g ive up
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control of thePbusiness.
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WhichPof the following items is listed as a current asset on a balance sheet? - correct answer- Accounts
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receivable
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Contractors who work in sales and use tax districts in California and purchase fixtures or materials are su bject
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to
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what percentage of tax? - correct answer-
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A certain percentage based on supplies used at the job site differs between tax districts
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WhichPof the following items does accounts receivable include? - correct answer-
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Money paid for labor and received forPservices
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Another term for "stockholders equity'' on a balance sheet is: - correct answer-Net worth
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State unemployment insurance taxes are: - correct answer-Paid by employers
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, If a construction company buys a new car for general use by the sales staff, to which of the following acc ounts
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would the depreciation of the car be charged? - correct answer-General and administrative costs
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How often must an employer report and pay social security (FICA) taxes? - correct answer-
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Quarterly. Most employment taxes are due quarterly, unless a monthly deposit schedule is met.
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Which of the following shows how far past-due each customer's payment is? - correct answer-
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Accounts receivable aging report
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Sales tax is collected from customers and paid to the: - correct answer-Board of Equalization
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What is the difference between fixed cost and overhead cost? - correct answer- Fixed
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costs fall under the overhead
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An employer is required to file quarterly state tax returns with the: - correct answer-
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Employment Development Department. The keyword in this question is "employer," which automatically implies
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employment taxes which are filed with the EmploymentPDevelopment Department
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Which of the following statements best describes the difference between the balance sheet and income sta tement?
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- correct answer-
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The balance sheet shows net worth at a particular point in time, while the income statement shows profit e arned
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over a period of time
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WhichPof the following may appear under accounts receivable? - correct answer-
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Retention. Retention is usually 10% which is withheld from the contract by the owner to ensure that the j ob is
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done properly and subcontractors are paid
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WhichPof the following is true aboutPoverhead? - correct answer-v v v v v v v v




All of the above: It includes advertising, bad debts, and storage charges, It consists of expenses necessary to run
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a company, but not necessarily expenses incurred on the job site, It is important to include in bids
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A company's profits are calculated by - correct answer-Subtracting expenses from revenues
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Working capital is defined as: - correct answer-Total current assets minus total currentPliabilities
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