Computer Accounting with QuickBooks 2019 Donna Kay 19th Edition- Test Bank

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Sample Test Computer Accounting with QuickBooks 2019, 19e (Kay) Chapter 3 QuickBooks Transactions

1) QuickBooks lists include all of the following except: 1. A) Customer List 2. B) Item List 3. C) Owner List 4. D) Vendor List

Answer: C Difficulty: 1 Easy Learning Objective: 03­03 QuickBooks Lists

Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

2) In QuickBooks, information about transactions can be entered in onscreen forms, such as: 1. A) Check 2. B) Invoice 3. C) Purchase Order 4. D) All of the choices are correct

Answer: D Difficulty: 1 Easy Learning Objective: 03­04 How Do We Enter Transactions in QuickBooks?

Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

3) Which of the following transactions is considered a Customers and Sales transaction?

1. A) Invoice 2. B) Purchase Order 3. C) Pay Bills 4. D) Check

Answer: A Difficulty: 2 Medium

Learning Objective: 03­07 Customer and Sales Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

4) Which of the following transactions is considered a Vendors and Expenses transaction?

1. A) Invoice 2. B) Receive Payment 3. C) Purchase Order 4. D) Make Deposit

Answer: C Difficulty: 2 Medium Learning Objective: 03­08 Vendor and Expense Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

5) QuickBooks lists include: 1. A) Customer List 2. B) Vendor List 3. C) Item List 4. D) All of the choices are correct

Answer: D Difficulty: 1 Easy Learning Objective: 03­03 QuickBooks Lists Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

6) All of the following are one of the four main categories of transactions in QuickBooks except?

1. A) Customers 2. B) Vendors 3. C) Employees 4. D) Owners

Answer: D Difficulty: 1 Easy Learning Objective: 03­05 What Are The Different Types of Transactions?

Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

7) Which of the following is a Banking transaction?

1. A) Make deposit 2. B) Pay employees

3. C) Enter bills 4. D) Pay bills

Answer: A Difficulty: 2 Medium Learning Objective: 03­06 Banking and Credit Card Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

8) Which of the following is a Vendor transaction?

1. A) Create invoices 2. B) Create estimates 3. C) Receive inventory 4. D) Receive payments

Answer: C Difficulty: 2 Medium Learning Objective: 03­08 Vendor and Expense Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

9) Which of the following is a Customer transaction?

1. A) Pay sales tax 2. B) Enter bills

3. C) Receive payments 4. D) Receive bills

Answer: C Difficulty: 2 Medium Learning Objective: 03­07 Customer and Sales Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

10) The Item List can be accessed from which section of the Home Page?

1. A) Banking 2. B) Customers 3. C) Vendors 4. D) Company

Answer: D Difficulty: 2 Medium Learning Objective: 03­03 QuickBooks Lists Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

11) Which of the following QuickBooks features can be used to save a transaction that will be re­used in the future?

1. A) Saved transactions 2. B) Create icon 3. C) Repeat transactions 4. D) Memorized transactions

Answer: D Difficulty: 2 Medium Learning Objective: 03­11 Memorized Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

12) To use a memorized transaction, select: 1. A) Select Lists Menu > Memorized Transaction List 2. B) Select Navigation Bar > Recurring Transaction List 3. C) Select Company section of the Home Page > Saved Transactions 4. D) None of the choices are correct

Answer: A Difficulty: 3 Hard Learning Objective: 03­11 Memorized Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

13) Double­entry accounting records exchanges in a transaction with debits and credits. Which of the following is recorded when a company purchases a desk and pays cash?

1. A) The desk is recorded with a credit and the cash is recorded with a credit 2. B) The desk is recorded with a debit and the cash is recorded with a debit 3. C) The desk is recorded with a credit and the cash is recorded with a debit 4. D) The desk is recorded with a debit and the cash is recorded with a credit

Answer: D Difficulty: 2 Medium Learning Objective: 03­13 Accounting Essentials:Double­Entry Accounting Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

14) The onscreen form for recording bills received is accessed from which section of the Home Page: 1. A) Vendors 2. B) Customers 3. C) Employees 4. D) Banking

Answer: A Difficulty: 2 Medium Learning Objective: 03­08 Vendor and Expense Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

15) The Banking section of the Home Page includes which of the following banking transactions?

1. A) Enter Credit Card Charges 2. B) Enter Bills 3. C) Pay Bills 4. D) Receive Payments

Answer: A Difficulty: 2 Medium Learning Objective: 03­06 Banking and Credit Card Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

16) Customer transactions include which of the following?

1. A) Write Checks 2. B) Enter Bills 3. C) Pay Bills

4. D) Create Invoices

Answer: D Difficulty: 2 Medium Learning Objective: 03­07 Customer and Sales Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

17) Vendor transactions include which of the following?

1. A) Enter Credit Card Charges 2. B) Enter Bills 3. C) Make Deposits 4. D) Receive Payments

Answer: B Difficulty: 2 Medium Learning Objective: 03­08 Vendor and Expense Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

18) When a customer deposit is recorded using the Make Deposits window, behind the screen QuickBooks converts the transactions into a journal entry that: 1. A) Debits Checking account, Credits Undeposited Funds 2. B) Credits Checking account, Debits Undeposited Funds

3. C) Debits Checking account, Credits Accounts Receivable 4. D) Debits Accounts Receivable, Credits Checking account

Answer: A Difficulty: 3 Hard Learning Objective: 03­07 Customer and Sales Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

19) When a bill is entered using the Enter Bills window, QuickBooks records a journal entry that: 1. A) Debits Checking account, Credits Expense account 2. B) Credits Expense account, Debits Checking account 3. C) Debits Expense account, Credits Accounts Payable 4. D) Debits Accounts Payable, Credits Checking account

Answer: C Difficulty: 3 Hard Learning Objective: 03­08 Vendor and Expense Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

20) When a bill is paid using the Pay Bills window, QuickBooks records a journal entry that: 1. A) Debits Checking account, Credits Undeposited Funds 2. B) Credits Checking account, Debits Accounts Payable 3. C) Debits Expense account, Credits Accounts Payable 4. D) Debits Accounts Receivable, Credits Checking account

Answer: B Difficulty: 3 Hard Learning Objective: 03­08 Vendor and Expense Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

21) In QuickBooks, how do you enter transaction information?

1. A) Onscreen Journal and onscreen forms 2. B) Onscreen Journal and QuickBooks reports 3. C) Onscreen forms and QuickBooks reports 4. D) None of the choices are correct

Answer: A Difficulty: 2 Medium Learning Objective: 03­04 How Do We Enter Transactions in QuickBooks?

Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

22) A business transaction is an exchange between the QuickBooks company and: 1. A) Vendor 2. B) Employee 3. C) Customer 4. D) All of the choices are correct

Answer: D Difficulty: 2 Medium Learning Objective: 03­04 How Do We Enter Transactions in QuickBooks?

Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

23) What are the three parts or processes of QuickBooks SatNav?

Answer: QuickBooks SatNav divides QuickBooks into three main processes

1. QuickBooks Settings. This includes Company Settings when setting up a new QuickBooks company and the Company Chart of Accounts.

2. QuickBooks Transactions. This includes recording transactions in QuickBooks. Transaction types can be categorized as Banking, Customers and Sales, Vendors and Expenses, and Employees and Payroll. In basic terms, recording transactions involves recording money in and money out.

3. QuickBooks Reports. QuickBooks reports are the output of the system, such as commonly used financial statements of Balance Sheet, Income Statement, and Statement of Cash Flows.

Difficulty: 2 Medium Learning Objective: 03­01 QuickBooks SatNav Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: manual

24) List 4 main types of QuickBooks transactions.

Answer: The 4 main types of QuickBooks transactions are:

1. Banking and credit card transactions 2. Customers and sales transactions 3. Vendors and expenses transactions 4. Employees and payroll transactions Difficulty: 2 Medium Learning Objective: 03­05 What Are The Different Types of Transactions?

Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: manual

25) Discuss the two main ways of entering information into QuickBooks. Why are two different ways necessary for entering information. What are the advantages and disadvantages of each method.

Answer: The two main ways of entering information into QuickBooks are:

1. Onscreen forms 2. Onscreen journal

Transactions can be entered using onscreen forms without knowing debits and credits, so this makes it easier for QuickBooks to be used by clients who do not have an accounting background. Some items, however, such as adjusting entries, are easier to enter using the onscreen journal. In addition, even when transactions are entered using onscreen forms, behind the screen, QuickBooks converts the information into a debit and credit journal entry that can be viewed in journal form.

Difficulty: 2 Medium Learning Objective: 03­04 How Do We Enter Transactions in QuickBooks?

Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: manual

Computer Accounting with QuickBooks 2019, 19e (Kay) Chapter 5 Customers and Sales

1) To record a customer sale on account, select: 1. A) Create Purchase Order 2. B) Sales Receipts 3. C) Create Estimates 4. D) Create Invoices

Answer: D Difficulty: 1 Easy Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

2) When recording a customer payment from a credit sale, select: 1. A) Create Invoice > Customer Payment > Customer & Job Name 2. B) Receive Payment > Customer & Job Name 3. C) Make Deposit > Customer & Job Name 4. D) Create Sales Receipt > Record Deposits

Answer: B Difficulty: 2 Medium Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

3) When recording a customer payment from a cash sale, select: 1. A) Create Invoice > Customer Payment > Customer Name Only 2. B) Make Deposit 3. C) Create Sales Receipt > Record Deposits 4. D) Receive Payment > Customer & Job Name

Answer: C Difficulty: 2 Medium Learning Objective: 05­06 Customer Sales Receipts Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

4) The Customers List in QuickBooks can be accessed from all of the following except: 1. A) Vendor section of the Home Page 2. B) Customers section of the Home Page 3. C) Customers Menu 4. D) Customers Center

Answer: A Difficulty: 1 Easy Learning Objective: 05­04 Customer Lists Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

5) To record a sales transaction, use: 1. A) Create Purchase Order > Receive Payment > Make Deposit 2. B) Create Invoices > Receive Payment > Make Deposits

3. C) Create Invoices > Create Sales Receipts > Make Deposits 4. D) Receive Payment > Create Sales Receipts > Make Deposits

Answer: B Difficulty: 2 Medium Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

6) Credit sales to customers are: 1. A) Recorded using the Enter Bills window 2. B) Recorded in a Credit Card Sales window 3. C) Recorded using the Create Sales Receipts window 4. D) Recorded using a Create Invoices window

Answer: D Difficulty: 1 Easy Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

7) What QuickBooks activity comes next in this series of business activities?

Create Invoice > Receive Payments > ________

1. A) Make Deposit 2. B) Create Sales Receipts 3. C) Pay Bills 4. D) Receive Undeposited Funds

Answer: A Difficulty: 1 Easy Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

8) When a credit sale is recorded on an invoice, QuickBooks records: 1. A) An increase to Sales and a decrease to Accounts Receivable 2. B) An increase to Sales and an increase to Accounts Receivable 3. C) An increase to Sales and an increase to Accounts Payable 4. D) A decrease to Sales and a decrease to Accounts Payable

Answer: B Difficulty: 3 Hard Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

9) All the reports below provide information about customer and job profitability, except: 1. A) Job Profitability Detail 2. B) Income by Customer Summary 3. C) Income by Customer Detail 4. D) Customer Detail List

Answer: D Difficulty: 2 Medium Learning Objective: 05­08 Customer Reports Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

10) Which report provides information to help in tracking accounts receivable?

1. A) Customers with Open Invoices 2. B) Accounts Receivable Aging Detail 3. C) Collections Reports 4. D) All of the choices are correct

Answer: D Difficulty: 2 Medium Learning Objective: 05­08 Customer Reports

Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

11) Sales in QuickBooks can be recorded with all the following means of payment except: 1. A) Cash 2. B) Check 3. C) Credit Card 4. D) Purchase Order

Answer: D Difficulty: 1 Easy Learning Objective: 05­05 Recording Sales Transactions Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

12) To increase collections of payments, you can use all the following QuickBooks features, except: 1. A) Accounts Receivable Aging Report 2. B) Customers with Open Invoices Report 3. C) Collections Report 4. D) Accounts Payable Aging Report

Answer: D Difficulty: 2 Medium

Learning Objective: 05­08 Customer Reports Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

13) To create the Income by Customer Summary report: 1. A) Select Reports Center > Customer & Sales 2. B) Select Customers Center > Income by Customer 3. C) Select Company Center > Customers & Sales 4. D) Select Reports Center > Company & Financials

Answer: D Difficulty: 2 Medium Learning Objective: 05­08 Customer Reports Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

14) Which one of the following activities is not shown in the Customers section of the Home Page?

1. A) Receive Payments 2. B) Pay Bills 3. C) Create Invoices 4. D) Create Sales Receipts

Answer: B Difficulty: 2 Medium Learning Objective: 05­03 Customer Navigation Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

15) To add a new job to the Customers List: 1. A) Select Customers Menu > Click Add Job 2. B) Select Customers Center window > Click New Customer & Job 3. C) Select the Customers List icon from the Customers section of the Home Page 4. D) Select Reports Center > Add Customer

Answer: B Difficulty: 2 Medium Learning Objective: 05­04 Customer Lists Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

16) The Job Profitability Summary Report is accessed from the: 1. A) Reports Center 2. B) Vendor Center

3. C) Employee Center 4. D) Company Center

Answer: A Difficulty: 2 Medium Learning Objective: 05­08 Customer Reports Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

17) To create the Aging of Accounts Receivable report: 1. A) Select Customers Center > Customers & Receivables 2. B) Select Company Center > Customers & Receivables 3. C) Select Reports Center > Customers & Receivables 4. D) Select Reports Center > Company & Financials

Answer: C Difficulty: 2 Medium Learning Objective: 05­08 Customer Reports Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

18) The Undeposited Funds account contains: 1. A) Only partial payments received from customers 2. B) Funds received from customers but not deposited in the bank

3. C) Funds the company owes vendors 4. D) Petty Cash funds

Answer: B Difficulty: 3 Hard Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

19) When an invoice is created in QuickBooks using the Create Invoices window, QuickBooks: 1. A) Decreases a Sales account and decreases the Checking account 2. B) Increases a Sales account and increases the Accounts Receivable account 3. C) Increases the Accounts Receivable account and increases the Checking account 4. D) Decreases the Accounts Payable account and increases the Checking account

Answer: B Difficulty: 3 Hard Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

20) The journal entry behind the screen that QuickBooks creates when a customer’s payment is received and recorded using the Receive Payment window includes: 1. A) Debit Accounts Receivable; Credit Checking account 2. B) Debit Checking account; Credit Accounts Receivable 3. C) Debit Undeposited Funds account; Credit Accounts Receivable 4. D) Debit Accounts Receivable; Credit Undeposited Funds account

Answer: C Difficulty: 3 Hard Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: automatic

21) Briefly explain the difference between creating a sales receipt and creating an invoice.

Answer: Creating a sales receipt is used when a customer pays for their goods or services at the time goods or services are provided. This is typically called a cash sale. Creating an invoice is used when the customer will pay at a later date after the goods or services are provided and will be recorded in the Receive Payment window. This is typically called a credit sale.

Difficulty: 2 Medium Learning Objective: 05­06 Customer Sales Receipts; 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: manual

22) Name 3 (three) reasons why a job for a customer might be pending.

Answer:A job can be pending because it is waiting on another condition to be met such as delivery of required parts, the contract is created but not signed, or to record customer charges as work is being performed but before final billing.

Difficulty: 3 Hard Learning Objective: 05­07 Customer Invoices Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: manual

23) List two different methods of accounting for bad debts (uncollectible accounts) and briefly explain how the two methods differ.

Answer: Two methods that can be used to account for bad debts are:

1. Direct write­off method. This method records bad debt expense when it becomes apparent that the customer is not going to pay the amount due. If the direct write­off method is used, the customer’s uncollectible account receivable is removed and bad debt expense is recorded at the time a specific customer’s account becomes uncollectible. The direct write­off method is used for tax purposes.

2. Allowance method. The allowance method estimates bad debt expense and establishes an allowance or reserve for uncollectible accounts.

When using the allowance method, uncollectible accounts expense is estimated in advance of the write­off. The estimate can be calculated as a percentage of sales or as a percentage of accounts receivable. (For example, 2% of credit sales might be estimated to be uncollectible.)

This method should be used if uncollectible accounts have a material

effect on the company’s financial statements used by investors and creditors.

Difficulty: 3 Hard Learning Objective: 05­10 Accounting Essentials: Customer Sales and Accounts Receivable Accessibility: Keyboard Navigation; Screen Reader Compatible Gradable: manual