COA Financial Management & Budgeting Flashcards
6 cards from real COA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 6 COA Financial Management & Budgeting flashcards as text
Which financial document summarizes an organization's revenues, expenses, and net income over a specific period?
Answer: Income statement
An income statement (also called a profit and loss statement) summarizes revenues and expenses to show net income or loss over a reporting period.
A budget that adjusts for changes in activity levels or volume is called a:
Answer: Flexible budget
A flexible budget adjusts revenue and expense projections based on actual activity levels, making it useful for performance evaluation.
In accounts payable management, the term 'net 30' means:
Answer: Payment is due within 30 days of the invoice date
Net 30 is a payment term indicating that the full invoice amount is due within 30 days of the invoice date.
Which budgeting method requires managers to justify every line-item expense from scratch each period?
Answer: Zero-based budgeting
Zero-based budgeting starts from zero each cycle, requiring justification for all expenditures rather than adjusting prior-period figures.
Petty cash is best described as:
Answer: A small fund used for minor day-to-day office expenses
Petty cash is a small, accessible fund kept on hand to cover incidental or minor expenses without requiring a formal purchase order.
What is the purpose of a purchase order (PO) in office financial management?
Answer: To authorize and document a request to buy goods or services
A purchase order is an official document issued by a buyer to a seller, authorizing the purchase and specifying items, quantities, and agreed prices.