Financial Reporting Flashcards
7 cards from real QBO practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Financial Reporting flashcards as text
When customizing a QBO report, what does setting a 'Accounting method' filter to 'Cash' do?
Answer: Converts accrual balances to cash basis for the report display
Switching the accounting method to Cash in a report converts the display so revenue and expenses appear only when cash is received or paid, without changing underlying data.
Which QBO report lists all open invoices grouped by how many days past due they are?
Answer: Accounts Receivable Aging Detail
The Accounts Receivable Aging Detail report groups unpaid invoices by aging buckets such as Current, 1-30 days, 31-60 days, and beyond.
What does the 'Net Income' line on a QBO Profit and Loss report represent?
Answer: Total revenue minus total expenses for the period
Net Income is the bottom-line figure showing total revenues minus total expenses, representing the company's profitability for the period.
A client wants to see profitability broken down by each product or service sold. Which QBO report should you recommend?
Answer: Sales by Product/Service Summary
The Sales by Product/Service Summary report breaks down quantity sold, amount, and profitability metrics by each individual product or service.
In QBO, which Balance Sheet section would you find 'Accounts Payable'?
Answer: Current Liabilities
Accounts Payable represents amounts owed to vendors that are typically due within one year, classifying it as a current liability on the Balance Sheet.
What happens when you click 'Save customization' after modifying a report in QBO?
Answer: The custom report settings are saved and accessible from Custom Reports
Saving a customization stores the report's filter and display settings in the Custom Reports tab for easy future access without reconfiguring.
Which of the following best describes 'Gross Profit' on a QBO Profit and Loss report?
Answer: Revenue minus Cost of Goods Sold only
Gross Profit is calculated by subtracting Cost of Goods Sold from total revenue, before operating expenses like payroll or rent are deducted.