Bookkeeping Certification Questions and Answers Rated A+
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Course
Bookkeeping Certification
Institution
Bookkeeping Certification
Bookkeeping Certification Questions
and Answers Rated A+
What is the purpose of an asset management report?
An asset management report provides details on the company's assets, including their value,
condition, and how they are being utilized.
How do you record a capital investment in b...
Bookkeeping Certification Questions
and Answers Rated A+
What is the purpose of an asset management report?
✔✔ An asset management report provides details on the company's assets, including their value,
condition, and how they are being utilized.
How do you record a capital investment in bookkeeping?
✔✔ A capital investment is recorded by increasing the company's equity account and reflecting
the new assets or cash brought into the business.
What is the function of an accounts receivable aging report?
✔✔ An accounts receivable aging report categorizes outstanding invoices based on how long
they have been due, helping manage and collect overdue payments.
What is the difference between a current asset and a fixed asset?
✔✔ A current asset is expected to be converted to cash or used up within one year, while a fixed
asset is a long-term asset used over a period longer than one year.
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,How do you handle bad debt in bookkeeping?
✔✔ Bad debt is recorded as an expense when it is determined that an amount owed by a
customer is uncollectible, affecting the accounts receivable and expense accounts.
What is the role of internal controls in bookkeeping?
✔✔ Internal controls are procedures implemented to safeguard assets, ensure accurate financial
reporting, and prevent fraud and errors in the accounting system.
What is a cash flow statement used for?
✔✔ A cash flow statement tracks the cash inflows and outflows of a business, providing insight
into its liquidity and financial health.
How do you account for interest income in bookkeeping?
✔✔ Interest income is recorded as revenue when it is earned, increasing the income account and
reflecting the amount of interest received.
What is the purpose of a bank reconciliation statement?
✔✔ A bank reconciliation statement is used to compare the company's bank statement with its
own records to identify and correct any discrepancies.
2
, How do you manage inventory in bookkeeping?
✔✔ Inventory is managed by tracking stock levels, recording purchases and sales, and adjusting
the inventory account to reflect accurate quantities and values.
What is the purpose of a reconciliation statement?
✔✔ A reconciliation statement is used to compare and align the company's financial records with
external documents like bank statements to ensure accuracy.
How do you record a business expense?
✔✔ To record a business expense, you enter the amount spent into the appropriate expense
account and note the transaction details, ensuring it is documented accurately.
What is an accounts payable ledger?
✔✔ An accounts payable ledger tracks all outstanding bills and payments that a company owes
to its suppliers or vendors.
How do you handle a sales return in bookkeeping?
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