Accounting Paraprofessional Skills and Knowledge Covered Flashcards
7 cards from real CAP practice questions. Tap to flip, then mark Knew It or Still Learning โ missed cards come back until you master them.
Read the first 7 Accounting Paraprofessional Skills and Knowledge Covered flashcards as text
Which document summarizes all transactions in a customer's account and is sent to request payment?
Answer: Statement of account
A statement of account lists all transactions (invoices, payments, credits) for a customer over a period and requests payment for any balance due.
The FUTA tax (Federal Unemployment Tax) is paid by:
Answer: The employer only
FUTA is solely an employer-paid tax; it is not withheld from employee wages.
Which of the following is NOT considered a generally accepted accounting principle (GAAP) concept?
Answer: Cash basis accounting
GAAP requires accrual basis accounting; cash basis accounting (recording only when cash changes hands) is not a GAAP concept for most businesses.
When a contra account such as Allowance for Doubtful Accounts is used, it is presented on the balance sheet as:
Answer: A deduction from Accounts Receivable
The Allowance for Doubtful Accounts is a contra asset that reduces the gross Accounts Receivable to its net realizable value on the balance sheet.
A trial balance that is in balance (debits equal credits) guarantees that:
Answer: The mathematical equality of debits and credits is maintained
A balanced trial balance only confirms that total debits equal total credits; it does not detect errors such as posting to wrong accounts or omitted transactions.
Which of the following is an example of an adjusting entry for accrued revenue?
Answer: Debit Accounts Receivable, Credit Revenue
Accrued revenue is earned but not yet received; the adjusting entry debits Accounts Receivable and credits Revenue to record the earned amount.
What is the purpose of a subsidiary ledger in accounts payable?
Answer: To provide detailed records for each individual vendor
An accounts payable subsidiary ledger maintains a separate account for each vendor, providing detail that supports the controlling account in the general ledger.