CAP Accounting Paraprofessional Preparation and Exam Resources 5

Question 1

Which of the following exam-taking strategies is most effective when encountering a difficult question on the CAP exam?

Accepted Answer

Flag it, move on, and return after completing easier questions

Answer

Flagging difficult questions and returning after completing easier ones preserves time and allows subconscious processing of the harder problem.

Question 2

What is a 'bank reconciliation' and why is it important for the CAP exam?

Accepted Answer

A process to match company cash records with bank statements to identify discrepancies

Answer

Bank reconciliation compares a company's internal cash records with the bank statement to identify errors, timing differences, or fraud.

Question 3

Which IRS form must employers file quarterly to report payroll taxes withheld from employees?

Accepted Answer

Form 941

Answer

Form 941, the Employer's Quarterly Federal Tax Return, is filed four times per year to report income taxes, Social Security, and Medicare taxes withheld.

Question 4

In the context of CAP exam study, what is the 'matching principle' in accounting?

Accepted Answer

Expenses should be recorded in the same period as the revenues they help generate

Answer

The matching principle requires that expenses be recognized in the same accounting period as the revenues they helped to produce.

Question 5

Which of the following best describes an 'adjusting entry' used in accounting?

Accepted Answer

An entry made at period-end to update account balances for accruals and deferrals

Answer

Adjusting entries are made at the end of an accounting period to ensure revenues and expenses are recognized in the correct period under accrual accounting.

(CAP) Certified Accounting Paraprofessional Practice Test

(CAP) Certified Accounting Paraprofessional Practice Test

CAP Accounting Paraprofessional Preparation and Exam Resources 5