PEREGRINE ACTUAL EXAM QUESTIONS AND
ANSWERS | VERIFIED AND WELL DETAILED
ANSWERS | NEW UPDATE 2026/2027 | GRADED A+ |
ASSURED PASS.
What is a general ledger? - CORRECT ANSWER - A general ledger account is
an account or record used to sort, store and summarize a company's
transactions.
asset accounts such as Cash, Accounts Receivable, Inventory, Investments,
Land, and Equipment
liability accounts including Notes Payable, Accounts Payable, Accrued
Expenses Payable, and Customer Deposits
stockholders' equity accounts such as Common Stock, Retained Earnings,
Treasury Stock, and Accumulated Other Comprehensive Income
What is the difference between accounts payable and accounts receivable? -
CORRECT ANSWER - Accounts payable is a current liability account in
which a company records the amounts it owes to suppliers or vendors for goods
or services that it received on credit.
Accounts receivable is a current asset account in which a company records the
amounts it has a right to collect from customers who received goods or services
on credit.
What is principles of accounting? - CORRECT ANSWER - Principles of
accounting can also refer to the basic or fundamental accounting principles: cost
principles, matching principles, full disclosure principles, materiality principles,
going concern principles, economic entity principles, and so on. In this context,
,principles of accounting refers to the broad underlying concepts which guide
accountants when preparing financial statements.
What is equity? - CORRECT ANSWER - Equity can indicate an ownership
interest in a business, such as stockholders' equity or owner's equity.
Equity can mean an owner's interest in a personal asset. For example, the owner
of a $200,000 house that has a mortgage loan of $75,000 is said to have
$125,000 of equity in the house.
What is the cost of goods sold? - CORRECT ANSWER - The cost of goods
sold is the cost of the products that a retailer, distributor, or manufacturer has
sold.
What is owner's equity? - CORRECT ANSWER - Owner's equity is one of the
three main sections of a sole proprietorship's balance sheet and one of the
components of the accounting equation: Assets = Liabilities + Owner's Equity.
What is meant by reconciling an account? - CORRECT ANSWER -
Reconciling an account is likely to mean proving or documenting that an
account balance is correct.
What is the difference between stocks and bonds? - CORRECT ANSWER -
Stocks, or shares of capital stock, represent an ownership interest in a
corporation. Every corporation has common stock.
Bonds are a form of long-term debt in which the issuing corporation promises to
pay the principal amount at a specified maturity date.
AN INCREASE TO WHICH OF THE FOLLOWING ACCOUNTS WILL
INCREASE OWNERS' EQUITY? - CORRECT ANSWER - Client Fees
,IN TIMES OF RISING PRICES, THE INVENTORY COST METHOD THAT
WILL YIELD THE LOWEST NET INCOME IS: - CORRECT ANSWER -
LIFO (LIFO is the acronym for last-in, first-out, which is a cost flow
assumption often used by U.S. corporations in moving costs from inventory to
the cost of goods sold.
Example: Assume that a corporation uses LIFO and has three units of a product
in its inventory. Due to its supplier raising its prices, the corporation purchased
the items at different costs and in the following sequence: $40, $44, and $46.
The corporation ships the oldest item (the one purchased for $40) to a customer
at a selling price of $60. However, under the LIFO cost flow assumption the
company reports its cost of goods sold at $46 (the latest cost) and reports a
gross profit of $14. (The costs of $40 and $44 remain in inventory.)
When a business erroneously records expenses as assets, it has violated the
measurement issue of - CORRECT ANSWER - classification
A dividend will reduce which of the following accounts? - CORRECT
ANSWER - Retained Earnings
Lying by omission involves intentionally - CORRECT ANSWER -
withholding material facts.
What is included in cash and cash equivalents? - CORRECT ANSWER - In
accounting, a company's cash includes the following: currency and coins
checks received from customers but not yet deposited checking accounts
petty cash
Cash equivalents are short-term, highly liquid investments with a maturity date
that was 3 months or less at the time of purchase.
, money market accounts
U.S. Treasury Bills
commercial paper
What is the difference between an implicit cost and an explicit cost? -
CORRECT ANSWER - An implicit cost is present but it is not initially shown
or reported as a separate cost.
An explicit cost is a cost that is present and it is clearly shown or reported as a
separate cost.
Conflicts of interest exist when employees must choose whether to -
CORRECT ANSWER - advance their own interests, those of the organization,
or those of some other group.
Which of the following statements is CORRECT? - CORRECT ANSWER -
Free cash flow (FCF) is, essentially, the cash flow that is available for interest
and dividends after the company has made the investments in current and fixed
assets that are necessary to sustain ongoing operations.
Which of the following is NOT one of the process motivation theories? -
CORRECT ANSWER - Acquired needs theory
An individual who purchases a computer later decides to acquire a new
motherboard. In terms of computing GDP, this new motherboard would be a(n)
- CORRECT ANSWER - Final good
The largest component of GDP is - CORRECT ANSWER - consumption
ANSWERS | VERIFIED AND WELL DETAILED
ANSWERS | NEW UPDATE 2026/2027 | GRADED A+ |
ASSURED PASS.
What is a general ledger? - CORRECT ANSWER - A general ledger account is
an account or record used to sort, store and summarize a company's
transactions.
asset accounts such as Cash, Accounts Receivable, Inventory, Investments,
Land, and Equipment
liability accounts including Notes Payable, Accounts Payable, Accrued
Expenses Payable, and Customer Deposits
stockholders' equity accounts such as Common Stock, Retained Earnings,
Treasury Stock, and Accumulated Other Comprehensive Income
What is the difference between accounts payable and accounts receivable? -
CORRECT ANSWER - Accounts payable is a current liability account in
which a company records the amounts it owes to suppliers or vendors for goods
or services that it received on credit.
Accounts receivable is a current asset account in which a company records the
amounts it has a right to collect from customers who received goods or services
on credit.
What is principles of accounting? - CORRECT ANSWER - Principles of
accounting can also refer to the basic or fundamental accounting principles: cost
principles, matching principles, full disclosure principles, materiality principles,
going concern principles, economic entity principles, and so on. In this context,
,principles of accounting refers to the broad underlying concepts which guide
accountants when preparing financial statements.
What is equity? - CORRECT ANSWER - Equity can indicate an ownership
interest in a business, such as stockholders' equity or owner's equity.
Equity can mean an owner's interest in a personal asset. For example, the owner
of a $200,000 house that has a mortgage loan of $75,000 is said to have
$125,000 of equity in the house.
What is the cost of goods sold? - CORRECT ANSWER - The cost of goods
sold is the cost of the products that a retailer, distributor, or manufacturer has
sold.
What is owner's equity? - CORRECT ANSWER - Owner's equity is one of the
three main sections of a sole proprietorship's balance sheet and one of the
components of the accounting equation: Assets = Liabilities + Owner's Equity.
What is meant by reconciling an account? - CORRECT ANSWER -
Reconciling an account is likely to mean proving or documenting that an
account balance is correct.
What is the difference between stocks and bonds? - CORRECT ANSWER -
Stocks, or shares of capital stock, represent an ownership interest in a
corporation. Every corporation has common stock.
Bonds are a form of long-term debt in which the issuing corporation promises to
pay the principal amount at a specified maturity date.
AN INCREASE TO WHICH OF THE FOLLOWING ACCOUNTS WILL
INCREASE OWNERS' EQUITY? - CORRECT ANSWER - Client Fees
,IN TIMES OF RISING PRICES, THE INVENTORY COST METHOD THAT
WILL YIELD THE LOWEST NET INCOME IS: - CORRECT ANSWER -
LIFO (LIFO is the acronym for last-in, first-out, which is a cost flow
assumption often used by U.S. corporations in moving costs from inventory to
the cost of goods sold.
Example: Assume that a corporation uses LIFO and has three units of a product
in its inventory. Due to its supplier raising its prices, the corporation purchased
the items at different costs and in the following sequence: $40, $44, and $46.
The corporation ships the oldest item (the one purchased for $40) to a customer
at a selling price of $60. However, under the LIFO cost flow assumption the
company reports its cost of goods sold at $46 (the latest cost) and reports a
gross profit of $14. (The costs of $40 and $44 remain in inventory.)
When a business erroneously records expenses as assets, it has violated the
measurement issue of - CORRECT ANSWER - classification
A dividend will reduce which of the following accounts? - CORRECT
ANSWER - Retained Earnings
Lying by omission involves intentionally - CORRECT ANSWER -
withholding material facts.
What is included in cash and cash equivalents? - CORRECT ANSWER - In
accounting, a company's cash includes the following: currency and coins
checks received from customers but not yet deposited checking accounts
petty cash
Cash equivalents are short-term, highly liquid investments with a maturity date
that was 3 months or less at the time of purchase.
, money market accounts
U.S. Treasury Bills
commercial paper
What is the difference between an implicit cost and an explicit cost? -
CORRECT ANSWER - An implicit cost is present but it is not initially shown
or reported as a separate cost.
An explicit cost is a cost that is present and it is clearly shown or reported as a
separate cost.
Conflicts of interest exist when employees must choose whether to -
CORRECT ANSWER - advance their own interests, those of the organization,
or those of some other group.
Which of the following statements is CORRECT? - CORRECT ANSWER -
Free cash flow (FCF) is, essentially, the cash flow that is available for interest
and dividends after the company has made the investments in current and fixed
assets that are necessary to sustain ongoing operations.
Which of the following is NOT one of the process motivation theories? -
CORRECT ANSWER - Acquired needs theory
An individual who purchases a computer later decides to acquire a new
motherboard. In terms of computing GDP, this new motherboard would be a(n)
- CORRECT ANSWER - Final good
The largest component of GDP is - CORRECT ANSWER - consumption
