Ivy Software Financial Accounting Finals/
Financial Accounting Pre Finals,
Comprehensive Resource To Help You Ace 2026-2027
Includes Frequently Tested Questions With ELABORATED
100% Correct COMPLETE SOLUTIONS
Guaranteed Pass First Attempt!!
Current Update!!
1. Why is the accounting cycle important? - ANSWER It results in the creation
of the financial accounting statement
2. What is an example of recurring income? - ANSWER Bank Account Interest
3. What should be considered when deciding on a time period for a budget? -
ANSWER Amount of financial activity
4. What should be included in a short-term budget? - ANSWER Monthly
water bill expenses
5. Which item is a living expense? - ANSWER Healthcare Premium
6. What is an example of a macro factor in planning a budget? - ANSWER
Interest rates
,7. What should a journal entry include when a company purchases inventory on
account? - ANSWER Increase in liabilities
8. A firm has the following assets and liabilities:
Cash: $10,500
Accounts Receivable: $35,000
Allowance for Doubtful Accounts: $2,000
Accounts Payable: $8,000
After preparing a classified balance sheet, what should the firm's total assets and
liabilities be? - ANSWER Total assets of $43,500, and total liabilities of $8,000
9. What would an accountant debit in order to record the purchase of machinery
made using a long-term loan? - ANSWER Machinery
10.An examination of Company A's finances shows assets of $50,000 and
stockholder's equity of $45,000.
11.What are the liabilities for Company A? - ANSWER $5,000
12.A corporation paid $5,000 in gross pay to its employees for the current month's
payroll.
,13.Which entry is needed? - ANSWER Debit wages expense $5,000
14.A company has four employees who are paid every two weeks. Each biweekly
payroll has a total expense of $7,500 and covers ten working days. The
company accountant is completing the bookkeeping for January, which
includes four days of the current pay period.
15.Which adjustment will need to be entered for these accruals? - ANSWER
Credit salary payable for $3,000
16.What determines the frequency of deposits of federal income taxes withheld
and Social Security and Medicare taxes? - ANSWER Amount owed by the
firm
17.Which concept is measured by the current ratio? - ANSWER Liquidity
18.Which characteristic of an organization is assessed using financial statement
analysis? - ANSWER Solvency
19.How can potential creditors use financial statement analysis? - ANSWER To
determine a company's ability to pay short-term debts
20.What does horizontal analysis evaluate? - ANSWER Increases or decreases
in financial statement information over a period of time
, 21.Which financial statement(s) contain the information needed to compute the
current ratio? - ANSWER Balance sheet
22.Which financial statement(s) contain the information needed to compute
return on sales? - ANSWER Income statement
23.Why would an accountant conduct financial forecasting? - ANSWER To
determine if a company will need additional investors
24.Stevie and Kate are new business owners trying to decide on a price for
widgets. Stevie decided widgets should be $40.
25.Which type of decision-making style did Stevie use? - ANSWER Autocratic
26.Mindy owns a small accounting firm that is considering increasing their prices
for some services. She calls the entire staff of 10 accountants to vote on which
services should make price changes.
27.Which type of decision-making style is Mindy using? - ANSWER Democratic
28.James is a manager at a university. He has been asked to make a decision
regarding the need for new employees. He asks Mary for advice, as she has
made similar decisions in the past.
29.What role in the RACI matrix does Mary hold? - ANSWER Consulted
Financial Accounting Pre Finals,
Comprehensive Resource To Help You Ace 2026-2027
Includes Frequently Tested Questions With ELABORATED
100% Correct COMPLETE SOLUTIONS
Guaranteed Pass First Attempt!!
Current Update!!
1. Why is the accounting cycle important? - ANSWER It results in the creation
of the financial accounting statement
2. What is an example of recurring income? - ANSWER Bank Account Interest
3. What should be considered when deciding on a time period for a budget? -
ANSWER Amount of financial activity
4. What should be included in a short-term budget? - ANSWER Monthly
water bill expenses
5. Which item is a living expense? - ANSWER Healthcare Premium
6. What is an example of a macro factor in planning a budget? - ANSWER
Interest rates
,7. What should a journal entry include when a company purchases inventory on
account? - ANSWER Increase in liabilities
8. A firm has the following assets and liabilities:
Cash: $10,500
Accounts Receivable: $35,000
Allowance for Doubtful Accounts: $2,000
Accounts Payable: $8,000
After preparing a classified balance sheet, what should the firm's total assets and
liabilities be? - ANSWER Total assets of $43,500, and total liabilities of $8,000
9. What would an accountant debit in order to record the purchase of machinery
made using a long-term loan? - ANSWER Machinery
10.An examination of Company A's finances shows assets of $50,000 and
stockholder's equity of $45,000.
11.What are the liabilities for Company A? - ANSWER $5,000
12.A corporation paid $5,000 in gross pay to its employees for the current month's
payroll.
,13.Which entry is needed? - ANSWER Debit wages expense $5,000
14.A company has four employees who are paid every two weeks. Each biweekly
payroll has a total expense of $7,500 and covers ten working days. The
company accountant is completing the bookkeeping for January, which
includes four days of the current pay period.
15.Which adjustment will need to be entered for these accruals? - ANSWER
Credit salary payable for $3,000
16.What determines the frequency of deposits of federal income taxes withheld
and Social Security and Medicare taxes? - ANSWER Amount owed by the
firm
17.Which concept is measured by the current ratio? - ANSWER Liquidity
18.Which characteristic of an organization is assessed using financial statement
analysis? - ANSWER Solvency
19.How can potential creditors use financial statement analysis? - ANSWER To
determine a company's ability to pay short-term debts
20.What does horizontal analysis evaluate? - ANSWER Increases or decreases
in financial statement information over a period of time
, 21.Which financial statement(s) contain the information needed to compute the
current ratio? - ANSWER Balance sheet
22.Which financial statement(s) contain the information needed to compute
return on sales? - ANSWER Income statement
23.Why would an accountant conduct financial forecasting? - ANSWER To
determine if a company will need additional investors
24.Stevie and Kate are new business owners trying to decide on a price for
widgets. Stevie decided widgets should be $40.
25.Which type of decision-making style did Stevie use? - ANSWER Autocratic
26.Mindy owns a small accounting firm that is considering increasing their prices
for some services. She calls the entire staff of 10 accountants to vote on which
services should make price changes.
27.Which type of decision-making style is Mindy using? - ANSWER Democratic
28.James is a manager at a university. He has been asked to make a decision
regarding the need for new employees. He asks Mary for advice, as she has
made similar decisions in the past.
29.What role in the RACI matrix does Mary hold? - ANSWER Consulted
