B113 - Computer Assisted Accounting

Why are there two company fieds on the Enter your company info page of the EasyStep Interview window?

The first is the "doing business as" company name; the second is the legal company name that will be used on the tax form.

How are invoice numbers handled in the Create Invoices window?

The user enters the desired number in the INVOICE # field.

What happens when you insert a check mark in the Vendor is inactive box in the Edit Vendor window?

The vendor's name is no longer displayed in reports, but the vendor information is retained.

What is the default account used for the Make General Journal Entries window?

There is no default account for this window. (pg. 122)

Which of the following statements about adjusting journal entries is not true?

They are recorded in special journals.

This QuickBooks feature is used to track billable hours allocated to jobs.

Time Tracking

What is the purpose of the reconciliation procedure in QuickBooks?

To ensure that a company's cash records are correct.

In the upper left corner of the QuickBooks' Enter Bills window, there are options labeled Bill and Credit. When would you use the Credit option?

To enter a credit memo from a vendor.

This report is used to verify that the total debits equal the total credits in the general ledger.

Trial Balance

Can you enter a new vendor in the Enter Bills window? If yes, how? If not, what must you do?

Yes, you can click <Add New> at the VENDOR drop-down list.

What happens when you enter a partial payment for an invoice in the Receive Payments window?

You can leave it as an underpayment or write off the extra (unpaid) amount.

Which of the following is not a correct statement?

You do not have to use the Restore command to open a backup copy of a company file.

What difference, if any, is there in the process of creating an invoice for a specific customer job rather than for a customer with no job?

You select the job rather the customer in the Customer:Job dropdown list in the Create Invoices window.

QuickBooks cannot delete a vendor that has

a balance or that has been part of a transaction for the fiscal period.

In a manual accounting system, payroll transactions are usually recorded in

a payroll journal or register.

In accounting, a business event or activity involving money is called

a transaction.

Account balances flow into a specific financial statement ased on the

account type.

Payroll setup in QuickBooks includes all of the following except

activating the Item List.

When a company is required to collect sales tax on an item sold, the tax amount is

added to the invoice price of the product.

Adjustments made to accounts at certain periods of time (e.g., at the end of the month) are referred to as

adjusting journal entries.

In the perpetual inventory system, the inventory quantity and values are updated

after each purchase and sale of inventory items.

The Item List should include

all items sold by the company, including services.

If a new customer needs to be added while in the Create Invoices window, you should

click <Add New> at the Customer:Job drop-down list.

If, in error, you do not enter an opening balance for the vendor in the QuickBooks Desktop Setup window,

delete the vendor and then reenter it in the QuickBooks Desktop Setup window with the opening balance.

A(n) _______ is a person hired by a company who will receive salary or wages on a regular basis.

employee

To process payroll with QuickBooks, you establish a file for each

employee.

A company that hires workers is referred to as a(n)

employer.

If a company has subscribed to a QuickBooks payroll service, it will not have to

enter amounts for the taxes in the Preview Paycheck window.

To allocate an employee's hours to several different jobs, you

enter multiple jobs in the Earnings sections of the Review Paycheck window.

Before you can enter inventory transactions in Quickbooks, you must

establish a file for each inventory item.

The multi-user mode in QuickBooks allows up to _____ users to access a company file at the same time.

five

A document in which financial activities are initially recorded chronologically is the

general journal.

In a manual accounting system, transactions are initially recorded chronologically in the

general journal.

At the end of the month in a manual accounting system, transactions are posted from the general journal to the

general ledger.

What does GAAP stand for?

generally accepted accounting principles

As a business grows in complexity, the need for special-purpose accounts

grows accordingly.

When QuickBooks' reconciliation process turns up transactions that were not recorded in the company records, you

have the opportunity to record them from within the Reconcile windows and adjust the company's accounts accordingly.

In QuickBooks, registers are not available for __________ accounts.

income and expense

Which of the following occurs when inventory is purchased on account?

inventory increases and accounts payable increases

If you exit the QuickBooks Desktop Setup window, you can return to it by selecting

Bulk Enter Business Details.

For transactions in the Pay Sales Tax window, QuickBooks uses these default accounts: Sales Tax Payable and

Cash.

The list of accounts a company uses as it conducts its business is referred to as the

Chart of Accounts

The list of all accounts a business uses is called the

Chart of Accounts List.

Which of the following Lists/Centers is partially set up when you use the EasyStep Interview window to ceate a new company file?

Chart of Accounts and Item list

Which of the following would not be considered an asset type account?

Accounts Payable

For transactions created in the Create Invoices window, ____ is the default general ledger posting account.

Accounts Receivable

When you enter a transaction in the Create Invoices window, QuickBooks automatically increases the ______.

Accounts Receivable account

What are the default posting accounts used in the Receive Payments window?

Accounts Receivable and Cash or Undeposited Funds

As customers with balances are entered in the QuickBooks Desktop Setup window and recorded in the Customer Center, a journal entry is recorded in the Journal report to record a debit to ___________ and a credit to ________.

Accounts Receivable; Uncategorized Income

Which report displays the Unadjusted Balance, Adjustments, and Adjusted Balance for all accounts?

Adjusted Trial Balance (Worksheet)

According to Chapter 3, who should be included in the Customer Center?

All customers with which the company does business (pg. 75)

Which of the following liabilities is payable to the United States Treasury?

All of the choices are correct. (Federal Unemployment, Federal Withholding, Social Sec/Medicare (Company and Employee))

Which of the following equity accounts is automatically created in QuickBooks when a new sole proprietorship is set up?

All of the choices are correct. (Opening Balance Equity, Owners Draw, Owners Equity)

When allocating payroll expenses to a specific job in QuickBooks, you have to do all the following except

All of the choices listed must be completed: (1) select an employee to pay. (2) select the customer job. (3) enter the number of hours worked on each job.

Which of the following common buisness activities requires recording a company's accounting records?

All of these activities require recording: paying bills, processing pay roll, purchasing and selling merchandise

You can select the Next button in the EasyStep Interview window with the keyboard by pressing

Alt + N

What does QuickBooks do when you write a check in the Pay Bills window?

Automatically decreases (debits) the Accounts Payable account.

Which of the following is one of the financial reports that companies prepare at least once a year?

Balance Sheet

Which of the following fields in the Begin Reconciliation window cannot be edited?

Beginning Balance

When setting up your company file, if you do not see your specific industry or any similar industry listed among the choices, what should you do?

Choose General product-based business or General service-based business.

Operations conducted by Quickbooks can be organized into four categories or levels. Which of the following is not one of the four levels of operation, according to the description in Chapter 1?

Closing Process

One way to open the Make General Journal Entries window is to begin by clicking ________ on the main menu bar.

Company

To change the company name, click _____ from the main menu bar and then click My Company from the drop-down menu.

Company

The main menu bar in QuickBooks includes

Company, Customers, Vendors, Employees, Banking, and Reports menus.

When you are informed of an NSF check, you should use the _____ window to reenter the amount due from the customer.

Create Invoices

When a company earns revenue from a job, the revenue can be recorded in which of the following windows?

Create Invoices or Enter Sales Receipts

The first level of operation with QuickBooks involves

Creating and setting up a new company file.

In QuickBooks, the job file of this Center serves as the jobs subsidiary ledger.

Customer

When you enter a bill in the Enter Bills window, QuickBooks automatically updates all the following except the

Customer Center.

To add a new job, click ______ at the main menu bar and then click Customer Center.

Customers

_______ generally refers to amounts taken out of the employee's paycheck or various fringe benefits such as insurance and pension.

Deductions

A zero (0) in this field at the Reconcile window indicates that all reconciling items have been accounted for.

Difference

If you accidentally delete an inventory item from the Item List, immediately click _________ and then Undo Delete Item.

Edit

To activate the QuickBooks payroll feature in a company that has already been set up, begin by clicking _______ on the main menu bar and then clicking Preferences.

Edit

To activate the account numbers feature in QuickBooks, open the Preferences window, which can be accessed by clicking ______ on the main menu bar.

Edit

To allocate payroll expenses to a job, click ______ at the main menu bar and then click Pay Employees.

Employees

Regarding payroll and federal income tax (FIT), which of the following statements is not true?

Employers generally do, but are not required to, withhold federal income tax from employee's pay.

In QuickBooks, what should you do before entering transactions for a customer?

Establish a file for the customer in the Customer Center.

In QuickBooks, what should you do before entering transations for a vendor?

Establish a file for the vendor in the Vendor Center.

What are the two subtabs in the Enter Bills window in QuickBooks?

Expenses and Items

Which of the following information is not available in the Product Information window?

Expiration Date

To view the edition and release number of QuickBooks, use the

F2 function key or Ctrl + 1 on the keyboard.

By what acronym is the Social Security tax known?

FICA

These taxes are imposed on both the employer and the employe.

FICA and Medicare

Which of the following payroll items would not be considered an expense for the company?

FIT

Which of the following pairs of taxes represent the federal and state versions of unempolymet insurance tax?

FUTA and SUI

Which of the following payroll items would not be considered an expense for the company?

Federal Income Tax (FIT)

The acronym FUTA refers to the ______ tax.

Federal Unemployment Insurance

To create a new company file, choose __________ from the main menu bar and then click __________.

File, New Company

This payroll report provides the information needed of a company's quarterly wages report to the federal government.

Form 941 (pg. 384)

This payroll report is prepared annually and provided both to the IRS and to the employee.

Form W-2

The purpose of the trial balance is to confirm that the ____ is in balance.

General ledger

When entering vendor information in the New Vendor window, what happens if you exit the window before clicking OK?

Information for that vendor will be lost.

To reverse the Uncategorized Expense account, make a journal entry with a debit to _________ and a credit to______.

Owners Capital; Uncategorized Expense

Which account will not have balances on the Trial Balance report immediately after the EasyStep Interview and QuickBooks Desktop Setup is completed?

Owners Draw

When payroll tax liabilities are paid, the _____ window is used.

Pay Liabilities

To record a receipt of payment within the discount period, click the Discounts and Credits button in the _______ window.

Receive Payments

The Adjust Quantity/Value on Hand activity window is used to record changes in the inventory resulting from

items being lost, stolen, damaged, or spoiled.

In QuickBooks, a project, assignment, or any identifiable segment of work for a customer is referred to as a

job.

Because the company is responsible for remitting to the tax-collecting agencies the federal and state income taxes it withholds from employees' gross pay, these taxes are recorded as ______ on the books of the company.

liabilities

A bill fom a vendor is considered a(n)

liability.

In QuickBooks, the Make General Journal Entries window is used primarily for

making adjusting journal entries.

When creating a job for a customer, if you inadvertently list the jobs as a subfile under the wrong customer, you should

move the job entry by clicking on the diamond to the left of the job and dragging it to the correct location.

Interest recorded by the bank but not yet recorded by the company falls under this category of reconciling item(s).

omissions (pg. 399 - "omissions, such as the interest recorded by the bank not recorded by the company")

When the payroll feature is activated, QuickBooks establishes

one default liablility posting account for all payroll-related liabilities.

A check written and recorded by the company but not yet paid by the bank is referred to as a(n)

outstanding check.

Terms of Net 30 Days mean that

payment is due within 30 days.

Many companies maintain two checking accounts; one is used to pay bills and collect and deposit receivables and other funds, and one is used exclusively for

payroll transactions.

The Item List contains the following important piece of information for each product except

preferred customer.

Payroll involves all of the following except

preparing a spreadsheet with government agency names and addresses.

The Employee Center in Quick Books contains all the following employee background information except

prior employer.

Which of the following information is not entered at the Job Info tab?

projected profit

QuickBooks' Enter Bills window is equivalent to the ______ in a manual accounting system.

purchases journal

In a manual accounting system, all purchases of goods and services on account are first recorded in a multicolumn

purchases journal.

The Time Tracking feature allows you to

record time in a weekly timesheet that is then allocated to a job.

Lists and Centers in QuickBooks are generally used for

recording data about customers, vendors and employees.

In QuickBooks, the Pay Sales Tax window is used to record the

remittance of sales tax collected from customers to the proper tax agency.

Which of the following data elements is not part of the services invoice described in Chapter 3?

revenue account number

When recording daily activities in QuickBooks, you can assign __________ to a particular job.

revenue and expenses

For inventory items in the Items List, the Income Account field indicates the general ledger account for

revenue.

Although you can leave the EasyStep Interview window before finishing, it is advisable not to leave before

saving the company file.

In accounting terms, the movement of money from one account to another is called a(n)

transfer.

The Item List stores information for each of the following except

unearend revenue.

The Cost field in the Edit Item window contains the

unit cost for the item.

When are you prevented from deleting an inventory item from the Item List?

when it has a balance or has been part of a transaction during the current period

After completing the EasyStep Interview and QuickBooks Desktop Setup windows,

you then customize the company file, update it, and prepare it for the accrual basis of accounting.

When restoring a backup copy in QuickBooks, what happens if you try to restore a file with a name that already exists?

A warning appears asking you whether you want to replace the existing file.

In the Service Charge section of the Begin Reconciliation window, which of the following do you not enter?

Account from which the check will be written to pay the charge

To access the General Ledger report, click Reports on the main menu bar and then click

Accountant & Taxes.

_____ is the process of recording, summarizing, and presenting a company's financial information.

Accounting

Until you activate the account numbers feature in QuickBooks,

Account numbers cannot be added because there is no account number field in the Edit Account window. (pg 219)

The default posting account for the Enter Sales Receipts window is ...

... Cash or Undeposited Funds

When you record a collection of accounts receivable in the Receive Payments window, QuickBooks automatically...

... decreases the Accounts Receivable account.

The Enter Sales Receipts window is used to record sales in which payment is ...

... received immediately.

In QuickBooks, a customer file cannot be deleted if the customer has...

...a balance or has been part of a transaction during the current accounting period.

When you enter an amount received in the Receive Payments window, it is by default applied to the ...

...oldest invoice. (pg. 88)

The Receive Payments window in QuickBooks displays all...

...open invoices for a particular customer. (pg. 87)

Each file in the Customer Center contains all of the following except the...

...purchase orders.

When making a backup copy of a company file, QuickBooks automatically assigns the extension _____ and condenses the file.

.QBB

Which of the following extensions is automatically assigned to a company file that has been restored in QuickBooks?

.QBW

The FICA tax rate for wages up to $132,000 is _______%.

6.2

In the Begin Reconciliation window, where does the amount to be entered in the Interest Earned field come from?

It comes from the bank statement.

How does QuickBooks know what revenue account to credit in the Create Invoices window?

It uses the revenue account specified in the Item List for the goods or services being purchased.

Services, along with their respective rates, provided by a company are entered in the

Item List.

The ____ report displays, in general journal format, all transactions recorded during a specific period of time.

Journal

To add a new account in QuickBooks, begin by clicking ________ on the main menu bar and then click Chart of Accounts.

Lists

Adjustments to account balance are recorded in the _______ window.

Make General Journal Entries

When creating an invoice for a job (without using the Time Tracking feature), into which of the following fields in the Create Invoices window do you not have to enter data?

Memo

When setting up a new vendor in the Vendor Center, which is one of the default payment terms listed?

Net 30

When adding a new employee in the New Employee window, where would you enter the federal filing status (married, single, etc.)?

On the Federal tab of the Taxes window

When you activate the payroll feature, QuickBooks creates these general ledger accounts.

Payroll Expenses and Payroll Liabilities

Items such as earnings, payroll tax, and payroll deductions are contained in the ________ List/Center.

Payroll Item

The report that displays the payroll taxes owed and unpaid for a specified period of time is the

Payroll Liability Balances report.

What are the two types of inventory systems?

Periodic and Perpetual

In QuickBooks, allocating payroll expenses to a job occurs in the ______ window.

Preview Paycheck

The Pay Employee window that allows you to enter payroll items and payroll taxes is the

Preview Paycheck window.

By what name is the income statement known in QuickBooks?

Profit & Loss report

To facilitate the recording of similar transactions in a manual accounting system, which special journals are typically used?

Purchases journal, sales journal, cash receipts journal, cash payments journal

Vendor transactions are entered in all of the following windows except the

Reference Window.

In QuickBooks, there are three Pay Employees windows: Enter Payroll Information, Preview Paycheck, and

Review and Create Paychecks.

The United States Treasury is responsible for collecting all of the following taxes except

SUI

Employees have the following taxes withheld from their gross pay except

SUI.

Which of the following transactions is entered in the Create Invoices window?

Sales on Account

Which of the following appears on the Profit & Loss statement?

Social Sec/Medicare Tax Expense

Why would you choose the Detailed Start method to create a new company file?

The Detailed Start will help you create a file that is customized for your company.

How does the Receive Payments window handle a situation in which a customer pays two invoices in full with a single payment?

The amount is automatically applied to the two invoices.

As vendors with balances are entered in the QuickBooks Desktop Setup window and recorded in the Vendor Center, a journal entry is recorded in the Journal report to record a debit to ____________ and a credit to ________.

Uncategorized Expenses; Accounts Payable

To reverse the Uncategorized Income account, make a journal entry with a debit to __________ and a credit to __________.

Uncategorized Income; Owners Capital

In QuickBooks, the _____ Center serves as the accounts payable subsidiary ledger for the company being paid.

Vendor

In a business, a ____ is someone from whom a company buys goods or services, either on account or for cash.

Vendor

To record a purchase and receipt of an inventory item on account, begin by clicking _______ on the main menu bar.

Vendors

What is a purchase on account?

When a company receives a bill for goods or services from a vendor but plans to pay it at a later date.

Cash purchases of inventory items are recorded in the _________ window.

Write Checks

In the Make General Journal Entries window, which is optional to record?

an explanation of the transaction

How are jobs displayed in the Customer Center window in QuickBooks?

as a subfile, indented below the customer with which they are associated

Inventory is a(n) __________ account.

asset

Before entering information from the bank statement, the Reconcile window displays all the following made by the company except

bad debts (NSF).

The process of determining the correct cash balance in an account by comparing company records with the bank statement is called a(n)

bank reconciliation.

Gross pay is the total earnings for the employee for a specific pay period

before any deductions.

Gross pay is the total earnings for the employee for a specific pay period

before any withholdings and deductions.

In a manual accounting system, a transfer from a company's operating account is usualy recorded in the _______ journal.

cash payments or general

As a result of assigning an employee's hours to a specific job, what expenses are not allocated to the job?

cost of goods sold

The COGS Account field in the New Item window indicates the account to which _______ should be posted.

cost of goods sold

Which of the following is not one of the items contained in the vendor's file?

credit card information

The journal entry to record the employee's earnings, deductions, and net pay includes a

credit to SIT Payable.

The journal entry to record the employer's payroll tax expenses on the paycheck date includes all of the following except

credit to Social Sec/Medicare Tax Expense.

In QuickBooks, when revenues and expenses are tracked by job, the job information is entered as part of the

customer file.

In QuickBooks, a job must always be associated with a(n)

customer.

Which of the following is the correct journal entry when remitting payroll taxes to a government agency?

debit Payroll Tax Payable and credit Cash - Payroll

The journal entry (behind the scenes) to record the bank service charge is recorded with a

debit to Bank Service Charge and credit to Cash.

The journal entry (behind the scenes) to transfer funds from one cash account to another is recorded with a

debit to Transferee Cash Account and credit to Transferor Cash Account

Using QuickBooks' Enter Credit Card Charges window to immediately record a company's credit charges ensures that

the assets and/or expenses are recorded in the proper time period.

The general ledger is

the document in which transactions are summarized by account.

When you set up the company file with the EasyStep Interview, the Chart of Accounts is configured on

the industry you select.

Adjusting journal entries are usually dated the

the last day of the month.

Withholdings generally refers to

the payroll taxes the employer is required to take out of the employee's paycheck and submit to the appropriate government agency.

In accounting terms, inventory refers to

the ready-made merchandise that is sold to customers for a profit.

Deposits in transit fall under this category of reconciling item(s).

timing difference.

Balance difference identified during a bank reconciliation fall into three categories:

timing differences, omissions, and errors.