Junior Accountant Position, Am Inc. Part 1

50 Questions | Total Attempts: 200

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Junior Accountant Position, Am Inc. Part 1

Choose the best answer, this is a pre-qualification examination for the Junior Accountant.


Questions and Answers
  • 1. 
    Basic Accounting Concept: A debit may signify a(n):
    • A. 

      Decrease in asset accounts.

    • B. 

      Decrease in liability accounts.

    • C. 

      Increase in the capital account.

    • D. 

      Decrease in expense accounts.

  • 2. 
    Basic Accounting Concept: Which is an advantage of a sole proprietorship form of business?
    • A. 

      Limited personal risk.

    • B. 

      Can continue indefinitely

    • C. 

      Owner makes all the decisions.

    • D. 

      All of the above.

  • 3. 
    Basic Accounting Concept: A corporation is a business which is:
    • A. 

      Easy to form.

    • B. 

      Ends with the death of a stockholder.

    • C. 

      Owned by stockholders.

    • D. 

      None of the above.

  • 4. 
    Basic Accounting Concept: The difference between the balance of a fixed asset account and the related accumulated depreciation account is termed:
    • A. 

      Liability

    • B. 

      Contra asset

    • C. 

      Book value

    • D. 

      Market value

  • 5. 
    Basic Accounting Concept: Who is the person in charge, most of the time, with  the fulfillment with GAAP.
    • A. 

      CFO

    • B. 

      Senior Accountant

    • C. 

      CEO

  • 6. 
    Basic Accounting Concept: The amount of net sales minus the amount of cost of goods sold measures:
    • A. 

      Gross profit

    • B. 

      Net profit

    • C. 

      Financial leverage

    • D. 

      Operating leverage

  • 7. 
    Basic Accounting Concept: On which financial statement would you find Salaries Expense?
    • A. 

      Income Statement

    • B. 

      Balance Sheet

    • C. 

      Statement of owner's equity

    • D. 

      It does not appear on a financial statement

  • 8. 
    Basic Accounting Concepts: Which of the following statements is incorrect?
    • A. 

      Assets - Liabilities = Capital

    • B. 

      Assets - Capital = Liabilities

    • C. 

      Liabilities + Capital = Assets

    • D. 

      Liabilities + Assets = Capital

  • 9. 
    Basic Accounting Concepts: Which of the following best describes a trial balance?
    • A. 

      It is a list of balances on the books

    • B. 

      Shows the financial position of a business

    • C. 

      It is a special account

    • D. 

      Shows all the entries in the books

  • 10. 
    Basic Accounting Concept: Which type of account would not be reported on the income statement?
    • A. 

      Revenue

    • B. 

      Expenses

    • C. 

      Withdrawals

    • D. 

      None of the above

  • 11. 
    Basic Accounting Concept: Who is the person in charge to sets the direction and oversees the operations of an organization?
    • A. 

      CFO

    • B. 

      Senior Accountant

    • C. 

      CEO

  • 12. 
    Basic Accounting Concept: Who is the person  responsible for managing the financial analisys, establishing the financial planning  and managing the financial risk of the corporation?
    • A. 

      CFO

    • B. 

      Senior Accountant

    • C. 

      CEO

  • 13. 
    Basic Accounting Concept: Which of the following accounts would be considered a temporary account?
    • A. 

      Revenue.

    • B. 

      Assets.

    • C. 

      Liabilities.

    • D. 

      Owner's Equity.

  • 14. 
    Basic Accounting Concept: Is it true that the trial balance totals should agree?
    • A. 

      No, there are sometimes good reasons why they differ

    • B. 

      No, because it is not a balance sheet

    • C. 

      Yes, except where the trial balance is extracted at the year end

    • D. 

      Yes, always

  • 15. 
    Basic Accounting Concept: The entry to record the payment of office salaries would be:
    • A. 

      Debit to Cash, credit to Accounts Receivable.

    • B. 

      Debit to Cash, credit to Salaries Expense.

    • C. 

      Debit to Salaries Expense, credit to Accounts Payable.

    • D. 

      Debit to Salaries Expense, credit to Cash.

  • 16. 
    Basic Accounting Concept: Items owned by the business such as land, supplies, and equipment are its
    • A. 

      Assets

    • B. 

      Liabilities

    • C. 

      Owner's equity

    • D. 

      Revenue

  • 17. 
    Basic Accounting Concept: Residual value is the:
    • A. 

      Value of the asset when it is purchased

    • B. 

      Value of the asset at the end of its useful life

    • C. 

      Cost of the asset

    • D. 

      Allocation of the cost

  • 18. 
    Basic Accounting Concept: Which of the following is most likely to result in an adjusting entry at the end of the period?
    • A. 

      Payment of two months' insurance in advance.

    • B. 

      Payment of one month's rent.

    • C. 

      Owner's withdrawals.

    • D. 

      Payment for routine maintenance on the company van.

  • 19. 
    Basic Accounting Concepts: Which of the following is correct?
    • A. 

      Capital can only come from profit

    • B. 

      Profit does not alter capital

    • C. 

      Profit increases capital

    • D. 

      Profit reduces capital

  • 20. 
    Basic Accounting Concept: Who is the person in charge  to carry out the strategic plans and policies as established by the board of directors?
    • A. 

      CFO

    • B. 

      Senior Accountant

    • C. 

      CEO

  • 21. 
    Basic Accounting Copcept: Which of the following would not be reported as a separate component on the income statement?
    • A. 

      Income from continuing operations

    • B. 

      Discontinued operations

    • C. 

      Prior period adjustment

    • D. 

      Extraordinary item

  • 22. 
    Accounting Application: C. Miller service purchased a microscope for $1,500. It has an expected life of 30 months and no residual value. The adjusting journal entry for the month is:
    • A. 

      Debit Depreciation Expense $50, credit Accumulated Depreciation $50.

    • B. 

      Debit Depreciation Expense $500, credit Accumulated Depreciation $500.

    • C. 

      Debit Accumulated Depreciation $50, credit Depreciation Expense $50.

    • D. 

      Debit Accumulated Depreciation $500, credit Equipment $500.

  • 23. 
    Accounting Application: Amy flew to Philadelphia on a business trip. The purchase price of the ticket was $400 on account. The entry to record the transaction is:
    • A. 

      Debit Accounts Payable, $400; credit Travel Expense, $400.

    • B. 

      Debit Travel Expense, $400; credit Accounts Payable, $400.

    • C. 

      Debit Capital, $400; credit Accounts Payable, $400.

    • D. 

      Debit Travel Expense, $400; credit Cash, $400.

  • 24. 
    Accounting Application: Carmen's catered a reception. The total price was $1,200. The customer paid $200 cash and charged the remainder. The journal entry to record this transaction is:
    • A. 

      Debit Cash $200 and Accounts Receivable $1,000; credit Catering Service Fees $1,200.

    • B. 

      Debit Cash $200; credit Accounts Receivable $200.

    • C. 

      Debit Cash $1,000 and Accounts Receivable $200; credit Catering Service Fees $1,200

    • D. 

      Debit Accounts Receivable $1,200; credit Cash $200 and Catering Service Fees $1,000.

  • 25. 
    Accounting Application: Carr Hardware has total assets of $75,000. What are the total assets if new baking equipment is purchased for $10,000 cash?
    • A. 

      $85,000

    • B. 

      $65,000

    • C. 

      $10,000

    • D. 

      $75,000

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