Accounting Flashcards
7 cards from real Robert Half Assessment Test practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Accounting flashcards as text
A bank reconciliation is prepared to:
Answer: Reconcile the difference between book and bank cash balances
A bank reconciliation identifies and explains differences between the company's cash records and the bank statement balance.
Which depreciation method results in the highest depreciation expense in the early years of an asset's life?
Answer: Double-declining balance
Double-declining balance is an accelerated method that front-loads depreciation, resulting in higher expense in early years.
Petty cash is replenished when the fund runs low. The journal entry to replenish it includes:
Answer: Debits to expense accounts and a credit to Cash
Replenishment debits the various expense accounts for items purchased and credits Cash for the total amount reimbursed.
What is the purpose of adjusting entries?
Answer: To update account balances before financial statements are prepared
Adjusting entries ensure revenues and expenses are recorded in the correct period under accrual accounting before statements are issued.
Under the allowance method for bad debts, writing off an uncollectible account:
Answer: Has no effect on net income or net accounts receivable
The write-off debits Allowance for Doubtful Accounts and credits Accounts Receivable, leaving net AR and net income unchanged.
Which of the following best describes a capital expenditure?
Answer: A cost that extends an asset's useful life or adds new capability
Capital expenditures are costs that provide future economic benefits by extending useful life or improving capacity, and are capitalized as assets.
The current ratio is calculated as:
Answer: Current Assets / Current Liabilities
The current ratio = Current Assets ÷ Current Liabilities, measuring a company's short-term liquidity.