FREE Accounting Technician Financial Reporting & Bookkeeping Questions and Answers
Which financial statement shows a company’s profitability over a specific period?
The income statement presents a company's revenues, expenses, and net profit or loss for a given period.
What is the purpose of a trial balance in bookkeeping?
A trial balance ensures that total debits and credits are equal, detecting errors in financial records before preparing statements.
What is the primary purpose of financial reporting?
Financial reporting provides stakeholders with accurate and transparent financial information to support decision-making.
Which financial document lists a company's assets, liabilities, and equity at a specific point in time?
The balance sheet provides a snapshot of a company’s financial position by listing its assets, liabilities, and owner’s equity.
What is double-entry bookkeeping?
Double-entry bookkeeping requires recording each financial transaction in two accounts, ensuring that debits and credits remain balanced.
Why is bank reconciliation important in bookkeeping?
Bank reconciliation helps ensure that a company's financial records match its bank statements, identifying discrepancies or errors.