CAP Accounting Paraprofessional Preparation and Exam Resources 4

Question 1

Which of the following is considered the best method to create a study schedule for the CAP exam?

Accepted Answer

Assess weak areas first, then distribute study time proportionally

Answer

Identifying weak areas and allocating more study time to them while maintaining review of stronger topics is the most strategic approach.

Question 2

What does the accounting equation state?

Accepted Answer

Assets = Liabilities + Owner's Equity

Answer

The fundamental accounting equation states Assets = Liabilities + Owner's Equity, which underpins double-entry bookkeeping.

Question 3

When preparing for the CAP tax section, which type of business entity is taxed at the individual owner's personal tax rate?

Accepted Answer

Both B and C

Answer

Both S corporations and sole proprietorships are pass-through entities where income is taxed at the individual owner's personal tax rate.

Question 4

In QuickBooks, what is the function of the 'Chart of Accounts'?

Accepted Answer

A complete list of all accounts used to categorize transactions

Answer

The Chart of Accounts is a categorized list of all accounts a company uses to record financial transactions in its general ledger.

Question 5

Which source document initiates the accounts payable process?

Accepted Answer

Purchase order or vendor invoice

Answer

Accounts payable is triggered when a company receives a vendor invoice or creates a purchase order documenting a purchase obligation.

(CAP) Certified Accounting Paraprofessional Practice Test