Part 2 Practice Test for Intuit Bookkeeping
Professional Certificate
1.which of the following are considered current assets?: cash. AR. inventory, marketable securities. Prepaid expenses. Etc.
2.Assets: resources that belong to a business and help it earn economic benefits in the future. They include current, capital, and
intangible assets
3.Current assets: assets that can be converted into cash within one year, such as cash, accounts receivable, and inventories
4.Long-term assets: Capital assets that are used for continuing or long-term operations, such as buildings, plant and equipment, and
land
5.Intangible assets: assets that have no physical form, such as goodwill, patents, and software
6.what accounts have a natural debit balance: Cash, accounts receivable, inventory, expenses 7. You're the bookkeeper for the
Pampered Pooch, a small mobile dog grooming business. The business received a $1,000 loan from their local credit
union and signed a promissory note. How should you record this transaction in the
accounting records?: debit the cash account by $1,000 and credit the notes payable account by $1,000 8. John owns a small retail
store that sells clothing. On monday, he sold $500 worth of merchandise to a customer who paid in cash. On Tuesday, he
sold $300 worth of merchandise to a customer who paid using a credit card. Question: Which of the following statements
correctly describes the effect of these sales transactions on the accounting equation for John's retail store?: Both sales increase
assets and owner's equity
9. You're the Bookkeeper for Between the Covers Booksellers, a small book resale business. The company uses the
accrual accounting method. You receive the following sales transaction detail (Note, for this question we are not posting
transactions for inventory to COGS):
-On January 1, the company sells 250 books for $20 each to John, who pays in cash. The sales tax rate is 10%.
-On January 2, the company sells 300 books for $15 each to Mary, who agrees to pay within 30 days. The sales tax rate is
10%. Question: How should these
transactions be recorded in the accounting records?: Debit Cash $5,500 and Accounts
Receivable $4,950, Credit Sales Revenue $5,000 and $4,500, Credit Sales Tax Payable $500 and $450
10. Which statements are true about the differences between notes receivable
and accounts receivable?: Notes receivable are interest-bearing assets, while accounts receivable are non-interest-bearing assets.
Notes receivable are written promises that an outside entity will pay the business on or before a specified date, while accounts
receivable are invoices with short term due dates. Notes receivable are long-term assets, while accounts receivable are current assets
11. Between the Covers Booksellers, sold a pallet of books to a local library for $100,000 on account. The terms of the
sale were 2/10, n/60, meaning that the library could get a 2% discount if it paid within 10 days or pay the full amount
within 60 days. However, the library failed to pay within the credit period. After 90 days of nonpayment, the bookshop
agreed to convert the account receivable into a note receivable. The note receivable was for the amount due plus a 5%
penalty fee, and it had a maturity date of six months from the date of issue. The note also carried an annual interest rate
of 12%. Question: How would you record this transaction in its accounting records? Choose the best
answer from the options given.: Debit Notes Receivable for $105,000, credit Accounts Receivable for $100,000, and Penalty Revenue
for $5,000
12. You're a bookkeeper for Office and More, a small company that sells office supplies. You use the direct write-off
method to account for uncollectible accounts. At the end of the year, you review the accounts receivable ledger and
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Professional Certificate
1.which of the following are considered current assets?: cash. AR. inventory, marketable securities. Prepaid expenses. Etc.
2.Assets: resources that belong to a business and help it earn economic benefits in the future. They include current, capital, and
intangible assets
3.Current assets: assets that can be converted into cash within one year, such as cash, accounts receivable, and inventories
4.Long-term assets: Capital assets that are used for continuing or long-term operations, such as buildings, plant and equipment, and
land
5.Intangible assets: assets that have no physical form, such as goodwill, patents, and software
6.what accounts have a natural debit balance: Cash, accounts receivable, inventory, expenses 7. You're the bookkeeper for the
Pampered Pooch, a small mobile dog grooming business. The business received a $1,000 loan from their local credit
union and signed a promissory note. How should you record this transaction in the
accounting records?: debit the cash account by $1,000 and credit the notes payable account by $1,000 8. John owns a small retail
store that sells clothing. On monday, he sold $500 worth of merchandise to a customer who paid in cash. On Tuesday, he
sold $300 worth of merchandise to a customer who paid using a credit card. Question: Which of the following statements
correctly describes the effect of these sales transactions on the accounting equation for John's retail store?: Both sales increase
assets and owner's equity
9. You're the Bookkeeper for Between the Covers Booksellers, a small book resale business. The company uses the
accrual accounting method. You receive the following sales transaction detail (Note, for this question we are not posting
transactions for inventory to COGS):
-On January 1, the company sells 250 books for $20 each to John, who pays in cash. The sales tax rate is 10%.
-On January 2, the company sells 300 books for $15 each to Mary, who agrees to pay within 30 days. The sales tax rate is
10%. Question: How should these
transactions be recorded in the accounting records?: Debit Cash $5,500 and Accounts
Receivable $4,950, Credit Sales Revenue $5,000 and $4,500, Credit Sales Tax Payable $500 and $450
10. Which statements are true about the differences between notes receivable
and accounts receivable?: Notes receivable are interest-bearing assets, while accounts receivable are non-interest-bearing assets.
Notes receivable are written promises that an outside entity will pay the business on or before a specified date, while accounts
receivable are invoices with short term due dates. Notes receivable are long-term assets, while accounts receivable are current assets
11. Between the Covers Booksellers, sold a pallet of books to a local library for $100,000 on account. The terms of the
sale were 2/10, n/60, meaning that the library could get a 2% discount if it paid within 10 days or pay the full amount
within 60 days. However, the library failed to pay within the credit period. After 90 days of nonpayment, the bookshop
agreed to convert the account receivable into a note receivable. The note receivable was for the amount due plus a 5%
penalty fee, and it had a maturity date of six months from the date of issue. The note also carried an annual interest rate
of 12%. Question: How would you record this transaction in its accounting records? Choose the best
answer from the options given.: Debit Notes Receivable for $105,000, credit Accounts Receivable for $100,000, and Penalty Revenue
for $5,000
12. You're a bookkeeper for Office and More, a small company that sells office supplies. You use the direct write-off
method to account for uncollectible accounts. At the end of the year, you review the accounts receivable ledger and
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