Florida Builders Exam 52 Questions Accounting Flashcards
1
Q
1.
The ___________________should handle the entry of accruals and entries made on the general ledger.
A.
Accountant
B.
Bookkeeper
C.
Qualifying Agent
D.
Secondary Qualifying Agent
A
1 A 11 Index: Accruals
2
Q
- are two main ways to pay employees.
A. Salary and wage
B. Wage and benefits
C. Salary and benefits
D. Wages and vacation pay
A
2 A 127 Index: Payroll Accounting
3
Q
- What is the impact of a construction company’s growing volume?
A. It is more difficult to hold expenses to a lower percentage
B. It is easier to hold expenses to a lower percentage
C. Fixed expenses rise quickly
D. Fixed expenses remain constant
A
3 B 90 Index: Volume and Profits
4
Q
- What are the filing requirements for form W2?
A. File 1 each January for the corporation
B. File 1 each December 31ˢᵗ for the corporation
C. File 1 each January to each employee
D. File 1 each January for each employee who worked at least two quarters in the prior year
A
4 C 137 Index: Forms - W-2
5
Q
- Delinquent receivables are receivables that have not been paid for .
A. 31 or more days
B. Between 15 and 30 days
C. 60 days or more
D. More than 1 day
A
5 A 66 Index: Receivables – See Accounts Receivable – uncollectible
6
Q
- is one of the most useful cash control methods.
A. Lapping
B. Reconciliation
C. Quick daily cash summary
D. Control ratio
A
6 C 180 Index: Cash Accounting - Control
7
Q
- The completed contract method should only be used for jobs with which of the following
characteristics?
A. Will complete in less than 1 year when annual gross receipts are under $1 million
B. Will complete within two years when annual gross receipts are under $10 million
C. Will complete within two years when annual gross receipts are under $5 million
D. Will complete in less than 1 year when annual gross receipts are under $10 million
A
7 B 25 Index: Completed Contract Accounting
8
Q
- How does the margin of profit increase?
A. With volume if costs and expenses are declining percentage of gross receipts
B. With volume if expenses are increasing percentage of gross receipts
C. With volume if costs and expenses are declining percentage of collections
D. With volume if expenses are increasing percentage of collections
A
8 A 90 Index: Margin of Profit
9
Q
- What is the part of a debt considered to be payable within 12 months?
A. Long-term asset
B. Short-term asset
C. Current liability
D. Deferred liability
A
9 C 253 Index: Balance Sheet Accounts
10
Q
- Under what circumstances can a lease be carried on the books as an asset?
A. When the lease can be paid off in 12 months or less
B. When you plan to buy the equipment at the end of the lease
C. When the offset liabilities are also included
D. A lease is never considered an asset
A
10 C 169 Index: Leasing Equipment
11
Q
- Which of the following is a percentage of direct labor costs?
A. Cell phone usage
B. Utilities at site trailer
C. Freight and selling expense
D. Management travel costs
A
11 C 228 Index: Labor Estimating
12
Q
- The Income Statement includes which of the following?
A. Income, direct cost, operating costs, indirect costs
B. Income, direct cost, operating costs, profits
C. Assets and liabilities
D. Accounts receivables and petty cash
A
12 B 17 Index: Income Statement
13
Q
- An aging list indicates .
A. The percentages of total receivables current and booked
B. The percentages of total receivables current and past due
C. The percentages of past due receivables and bad debt
D. The percentages discounts applied to total receivables
A
13 B 46 Index: Aging List
14
Q
- Form 508 is used to .
A. Deposit federal unemployment taxes with local banks
B. Deposit state unemployment taxes with the IRS
C. File annual to report FICA Taxes
D. File monthly to report taxable benefits
A
14 A 138 Index: Forms, tax - 508
15
Q
- Costs of goods completed divided by average inventories of work in process equal .
A. Cost of completion ratio
B. Cost of goods completed
C. Work in process ratio
D. Work completed ratio
A
15 C 121 Index: Inventory, analyzing.
16
Q
- If total costs to date for a construction job are $215,000 and the estimated cost to complete
the job are $202,000, the current percentage of completion of the project is .
A. 52%
B. 48%
C. 10%
D. 25%
A
16 A 23-24 Index: Percentage of Completion
$215,000 divided by ($215,000 + $202,000) = 52%
17
Q
- is not true about current assets.
A. They are considered liquid assets
B. They can be converted to cash in no more than 6 months
C. They can be converted to cash in 12 months or less
D. They include cash, accounts receivable and inventory
A
17 B 252 Index: Current Assets
18
Q
- What financial statement is a summary of existing conditions of the business?
A. Income Statement
B. Net worth Summary
C. Statement of Cash Flows
D. Balance Sheet
A
18 D 247 Index: Financial Statements
19
Q
- What are the two methods to prepare a cash budget?
A. Cash movement method and source of funds method
B. Cash movement method and collected funds method
C. Cash reconciliation and source of funds reconciliation
D. Cash movement method and source of funds and application method
A
19 D 176 Index: Cash Budgeting
20
Q
- Fixed Expenses include all the following except .
A. Security
B. Accounting fees
C. Bad debts
D. Interest
A
20 C 142 Index: Expenses - fixed
21
Q
- What do you get when you subtract Liabilities from Assets?
A. Income
B. Debts
C. Net Worth
D. Quick Ratio
A
21 C 17 Index: Balance Sheet
22
Q
- What is the purpose of copy D of a W2 form?
A. Given to employee for their personal records
B. Filed with employee’s state tax return
C. Filed with employee’s federal tax return
D. Kept by employer for their records
A
22 D 137 Index: Forms – W-2
23
Q
- How can you separate payroll from other expenses?
A. Set up a separate payroll account with its own style for payroll
B. Use the same general account but a different check for payroll
C. Pay someone to prepare payroll and prepare backup reports
D. All the above
A
23 D 126 Index: Payroll Accounting - separate accounts
24
Q
- Using the straight-line method of depreciation, how much is taken each year?
A. Same amount each year
B. Amount allowable under MACRS
C. Declining percentage based on salvage value
D. Declining percentage until zero is reached
A
24 A 163 Index: Straight Line Depreciation
25
25. When applying for a loan which of the following ratios would be most beneficial?
A. Current ratio of 1 to 1
B. Current ratio of 3 to 1
C. Debt ratio of 1 to 1
D. Debt ratio of 3 to 1
25 B 268 Index: Financial Ratios
26
26. ABC Construction purchased a crane as a cost of $125,000 to be used in the general course of
business. This expense should be classified how?
A. Fixed Expense
B. Fixed Receivable
C. Fixed Asset
D. Current Asset
26 C 156 Index: Equipment - purchases
27
27. What are the two easiest methods to account for tax liabilities?
A. Payroll Taxes Withheld and Employer Payroll Taxes Withheld
B. Payroll Taxes Withheld and Employer Payroll Taxes Payable
C. Payroll Taxes Withheld and Employee Payroll Taxes Payable
D. Payroll Taxes Withheld and Employee Payroll Taxes Due
27 B 134 Index: Tax, Liabilities – accounting for
28
28. Which of the following will bankers not require when considering making a loan?
A. One year’s income statement
B. A balance sheet
C. A state income tax return
D. A cashflow projection
28 C 317 Index: Loan, applications
29
29. What should you do when calculating a break-even point?
A. Coordinate your sales planning with budgets and estimates
B. Determine the amount of costs to make a 10% profit
C. Coordinate sales and production activities
D. None of the above
29 A 178 Index: Breakeven Point
30
30. What is the major disadvantage of the percentage of completion contract?
A. All money is earned at the completion of the contract
B. All money is front-end loaded
C. Expenses are not paid until the work is complete
D. Income, cost, expenses, and profit are only estimates until the work is complete
30 D 24 Index: Percentage of Completion accounting
31
31. What is required for all petty cash payments?
A. They must be supported by a voucher or receipt
B. All payments must be made by company credit card
C. They must be repaid within 30 calendar days
D. They must be repaid within 30 business days
31 A 209 Index: Petty Cash Imprest System - controlling
32
32. The completed-contract method is always used for what type of projects?
A. Governmental
B. Projects that take 1 year of less
C. Small jobs
D. Capitalized projects
32 C 25 Index: Completed Contract Method
33
33. Which of the following is not an advantage of leasing equipment?
A. Equipment can be leased for a single job as needed
B. You can build equity in the asset
C. An immediate tax deduction is available
D. No large investment or financing commitment is required
33 B 169 Index: Equipment, Leasing
34
34. How should cash sales be recorded?
A. By category
B. By priority
C. Alphabetically by source of funds
D. By date
34 D 38 Index: Cash Sales, recording
35
35. What is the best tool to minimizes petty cash shortages?
A. Petty cash summary report
B. Impression system
C. Cash reconciliation
D. Imprest system
35 D 208 Index: Petty Cash
36
36. What system of recording sales combines steps and transfer records simultaneous with carbon
paper?
A. Imprest system
B. Percentage of completion
C. Pegboard
D. Master Sales record
36 C 47 Index: Sales Records
37
37. What occurs when you use the 2% - 10 days, net 30 method?
A. You collect 2% of the balance due within 10 days
B. Your vendor provides a 98% reduction in the balance due within 30 days
C. You collect 2% of the balance due within 30 days
D. You collect 98% of the balance due within 10 days
37 D 59 TAB: Incentive Discounts
38
38. What does paying off current liabilities accomplish?
A. Increases current assets and liabilities
B. Reduces the current ratio
C. Reduces current assets and liabilities
D. Increases net profit
38 C 175 Index: Cash Budgeting
39
39. What is the goal of the budget?
A. Establish ideal levels of expense and income
B. Establish a breakeven point
C. Compare spending to saving
D. Put money away to pay tax liabilities
39 A 144 Index: Budget, Analysis
40
40. Which of the following is not an advantage of the Imprest system?
A. Is easily maintained
B. Entries don’t require special effort
C. Cash shortages are reduced
D. Controls are not built in
40 D 208 Index: Imprest System for petty cash
41
41. The budgeting process includes which of the following?
A. Preparing the budget and reviewing results with your CPA
B. Having CPA prepare and review budget annually
C. Prepare budget and compare to last year’s spending
D. Prepare the budget, analyze results and act to control expenses
41 D 144 Index: Budget Analysis
42
42. Which of the following do good inventory controls accomplish?
A. Minimizes investments in capital inventory
B. Reduces exposure to material theft
C. Reduces costs of taxes and insurance on inventory
D. All of the above
42 D 121 Index: Inventory, controlling
43
43. Which of the following is true of current liabilities?
A. They are not liquid
B. They are convertible within one year
C. They are convertible in no less than six months
D. They are 100% tax deductible
43 B 155, 253 Index: Current Liabilities
44
44. When preparing financial statement for a lender before applying for a loan, you should
do which of the following?
A. Reduce current liabilities
B. Increase current assets
C. Reduce accounts receivables
D. Increase profit
44 A 174 Index: Liquidity Tests
45
45. Which of the following are not variable expenses?
A. Bad debts
B. Rent
C. Union Welfare
D. Small Tools
45 B 142 Index: Expenses, variable
46
46. Goodwill is considered what type of asset?
A. Current asset
B. Tangible asset
C. Intangible asset
D. Fixed asset
46 C 253 TAB: Goodwill
47
47. Budgets are meant to do which of the following?
A. Forecast expenses and income
B. Establish ideal levels of income and expense
C. Forecast net profit
D. Measure projected expenses
47 B 144 Index: Budget, analysis
48
48. Which of the following are considered current liabilities?
A. Taxes payable
B. Notes
C. Deposits to be refunded
D. All the above
48 D 253 Index: Current Liabilities
49
49. How must the books be updated when equipment is sold?
A. Gross value must be added to the books
B. Gross value must be removed from the books
C. Accumulated depreciation must be removed from the books
D. Both B and C
49 D 170 Index: Equipment, sales
50
50. An Income statement is broken down into which of the following?
A. Standard divisions
B. Chart of accounts
C. Profit and losses
D. Classifications of intent
50 A 248 Index: Income statement accounts, described
51
51. What is the term used to describe when funds are taken from one customer account and
transferred to another and then written off as bad debt?
A. Falsifying sales records
B. Lapping
C. Unofficial borrowing
D. Prorating
51 B 181 TAB: Lapping
52
52. Which of the following is not true about petty cash vouchers?
A. It is a support document for accounting entries
B. It has a carbon copy of every transaction
C. It verifies someone received cash from the fund
D. It is a uniform way to identify payments
52 B 209 Index: Petty cash imprest system
