Accounting Basics For QuickBooks

32 Questions | Total Attempts: 718

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QuickBooks Quizzes & Trivia

Quick books are the most used accounting software in the world. No matter how simple your organization the need to keep accurate books of account is important and this software helps you achieve that. How conversant are you with the use of QuickBooks? Take up this quiz to find out.


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Questions and Answers
  • 1. 
    • A. 

      That the Income and Expense accounts are always part of every transaction

    • B. 

      There are always at least two accounts involved in every financial transaction

    • C. 

      That the Cost of Goods Sold account and the Liabilities account are always part of a transaction

    • D. 

      The Equity and Asset accounts are always involved in a transaction

  • 2. 
    Literally, "Debit" means what?
    • A. 

      The Expense account of a transaction

    • B. 

      The Equity account of a transaction

    • C. 

      The left side of a transaction

    • D. 

      The right side of a transaction

  • 3. 
    Which certain types of accounts increase when you debit them?
    • A. 

      Liabilities, equity, and income

    • B. 

      Checking, expenses, and income

    • C. 

      Assets, cost of goods sold, and expenses

    • D. 

      Income, assets, and liabilities

  • 4. 
    Which statement is a financial “picture” of your company?
    • A. 

      The General Ledger

    • B. 

      The Revenue & Income Summary

    • C. 

      The Chart of Accounts

    • D. 

      The Balance Sheet

  • 5. 
    Which of the following is one of the six accounting principles?
    • A. 

      The Even/Odd principle

    • B. 

      The T square principle

    • C. 

      The Matching principle

    • D. 

      The Square principle

  • 6. 
    What question does the Revenue principle answer?
    • A. 

      What is revenue?

    • B. 

      How do you measure revenue?

    • C. 

      When do you record revenue?

    • D. 

      All of the above

  • 7. 
    What are the three factors to determine whether or not accounting information is Reliable?
    • A. 

      Valid, Verifiable, and Positive

    • B. 

      Valid, Verifiable, and Neutral

    • C. 

      Valid, Verifiable, and Negative

    • D. 

      Valid, Reliable, and Assumable

  • 8. 
    Why is it important to choose the correct account type when setting up the chart of accounts?
    • A. 

      If the type is incorrect, then financial statements will be wrong

    • B. 

      The account type determines how QuickBooks uses the account

    • C. 

      The account type determines which financial statement the account appears on

    • D. 

      All of the above

  • 9. 
    • A. 

      A statement from the beginning of the fiscal year

    • B. 

      A financial movie showing how your business is doing over a period of time

    • C. 

      A snapshot or picture of how your business looks at a certain time

    • D. 

      None of the above

  • 10. 
    • A. 

      To determine which financial statement the account appears on, and which principle the account falls under

    • B. 

      To determine which financial statement the account appears on, and how QuickBooks uses the account

    • C. 

      To determine how QuickBooks uses the account, and which principle the account follows

    • D. 

      Any of the above

  • 11. 
    When you double-click on a balance sheet account in the Chart of Accounts, what does QuickBooks display?
    • A. 

      The Account Register

    • B. 

      The Edit Account window

    • C. 

      The Add New Account window

    • D. 

      The Make Inactive window

  • 12. 
    When receiving payments in QuickBooks, you must specify which of the following?
    • A. 

      Which Labor account the payment will decrease

    • B. 

      What account the payment comes from

    • C. 

      Where the payment goes (Undeposited Funds, Checking, etc)

    • D. 

      What company is in the “Pay to the order of” field

  • 13. 
    What is the QuickBooks term for an invoice you've received from a vendor?
    • A. 

      Purchase Order

    • B. 

      Invoice

    • C. 

      Bill

    • D. 

      Debit

  • 14. 
    Why might you use a journal entry?
    • A. 

      To enter transactions that you cannot enter with a built-in form

    • B. 

      To correct errors

    • C. 

      For year-end adjustments

    • D. 

      All of the above

  • 15. 
    If your accounting records are incorrect, where in QuickBooks can you look to help solve the problem?
    • A. 

      Reports: Customers & Receivables: Open Invoices

    • B. 

      Reports: Inventory: Inventory Valuation Summary

    • C. 

      Reports: Vendors & Payables: Unpaid Bills Detail

    • D. 

      Any of the above

  • 16. 
    What is one tool or method outside of QuickBooks that can help support your financial data IN QuickBooks?
    • A. 

      A statement from your accountant

    • B. 

      Documents from vendors and customers, like bills and cleared checks

    • C. 

      A documented phone call from your banker

    • D. 

      Handwritten records from conversations with vendors

  • 17. 
    What is one way to verify the Accounts Payable balance on the Balance Sheet?
    • A. 

      Click Inventory: Inventory Valuation Summary to review the value of all inventory

    • B. 

      Click Reports: Vendors & Payables: Unpaid Bills Detail to review to whom you owe money

    • C. 

      Click Reports: Company & Financial: Profit and Loss Standard to review the Profit and Loss

    • D. 

      Click Reports: Vendors & Payables: Summary Report

  • 18. 
    • A. 

      It is a tool QuickBooks offers to help you understand and use many of the ratios accountants use

    • B. 

      It is a tool bankers use to analyze your financial data

    • C. 

      It is a tool QuickBooks uses to analyze financial data

    • D. 

      It is a tool accountants use while analyzing your financial data

  • 19. 
    Why is it not always meaningful to compare trends?
    • A. 

      Variable costs might increase in numbers from year to year, but decrease as percentage of income

    • B. 

      Sometimes there is a large increase in sales

    • C. 

      You may have a large increase in costs from one year to the next

    • D. 

      Income may be lower from one year to the next

  • 20. 
    When analyzing trends in variable expenses, how should you display expenses to get accurate trend data?
    • A. 

      As Percent of Expense

    • B. 

      As Percent of Income

    • C. 

      As Percent of Row

    • D. 

      As Percent of Column

  • 21. 
    • A. 

      QuickBooks must be closed for the backup to work

    • B. 

      The computer must be turned off

    • C. 

      The QuickBooks company file must be open, but you cannot do any work in the file at the time of the backup

    • D. 

      The QuickBooks company file must be closed, but the computer must be turned on

  • 22. 
    What two Customer reports should you run every month?
    • A. 

      The Open Invoices report and the Item Price List

    • B. 

      The Open Invoices report and the Collections Report

    • C. 

      The Collections Report and the Item Price List

    • D. 

      The Sales by Customer Summary report and the Open Invoices report

  • 23. 
    How often should you back up your QuickBooks data file?
    • A. 

      Once a week

    • B. 

      Once a day

    • C. 

      Once a month

    • D. 

      Only when you set the closing date

  • 24. 
    What report do you start with to create the Entry Journal?
    • A. 

      Balance Sheet Standard

    • B. 

      Journal report

    • C. 

      Make General Journal Entry window

    • D. 

      Custom Transaction Detail Report

  • 25. 
    When an accountant is working within an accountant's copy of a company file, what does QuickBooks display in the title bar?
    • A. 

      "Accountant's Copy"

    • B. 

      "Accountant's Copy Exists"

    • C. 

      "Your Company File"

    • D. 

      The title bar is the same, whether or not an accountant's copy exists

  • 26. 
    • A. 

      . A form your accountant fills out to enter and edit notes on your finances

    • B. 

      An agreement with your accountant formalizing each party’s responsibilities

    • C. 

      Feature that allows the accountant to review and make adjustments to your financial numbers

    • D. 

      All of the above

  • 27. 
    What menu would you access to turn on Classes?
    • A. 

      Edit: Duplicate

    • B. 

      Edit: Copy

    • C. 

      Edit: Classes

    • D. 

      Edit: Preferences

  • 28. 
    . What does a budget offer in QuickBooks that a forecast does NOT offer?
    • A. 

      More options for class reports

    • B. 

      They offer the same options

    • C. 

      More reporting options

    • D. 

      Fewer reporting options

  • 29. 
    What does it mean if you report transactions on an accrual basis?
    • A. 

      You report all income that has been earned and all expenses that have been incurred, regardless if the money has been received or paid

    • B. 

      You only report income if the money has been received

    • C. 

      You only report expenses if they have been paid

    • D. 

      Both b. and c.

  • 30. 
    By default, Net Income for the prior year flows into which account in the next year?
    • A. 

      Retained Earnings

    • B. 

      Assets

    • C. 

      Liabilities

    • D. 

      Accounts Receivable

  • 31. 
    Which of the following is NOT a step for the improved closing entry?
    • A. 

      Change the name of the Retained Earnings account

    • B. 

      Create a new Retained Earnings account

    • C. 

      Delete the Retained Earnings account

    • D. 

      Transfer each year's income or loss into the new Retained Earnings account

  • 32. 
    When executing the Improved Closing Entry, what account type should you choose for the new Retained Earnings account?
    • A. 

      Retained Earnings

    • B. 

      Fixed Asset

    • C. 

      Equity

    • D. 

      Other Current Liability