CAP Accounting Paraprofessional Skills and Knowledge Covered 5

Question 1

Which document summarizes all transactions in a customer's account and is sent to request payment?

Accepted Answer

Statement of account

Answer

A statement of account lists all transactions (invoices, payments, credits) for a customer over a period and requests payment for any balance due.

Question 2

The FUTA tax (Federal Unemployment Tax) is paid by:

Accepted Answer

The employer only

Answer

FUTA is solely an employer-paid tax; it is not withheld from employee wages.

Question 3

Which of the following is NOT considered a generally accepted accounting principle (GAAP) concept?

Accepted Answer

Cash basis accounting

Answer

GAAP requires accrual basis accounting; cash basis accounting (recording only when cash changes hands) is not a GAAP concept for most businesses.

Question 4

When a contra account such as Allowance for Doubtful Accounts is used, it is presented on the balance sheet as:

Accepted Answer

A deduction from Accounts Receivable

Answer

The Allowance for Doubtful Accounts is a contra asset that reduces the gross Accounts Receivable to its net realizable value on the balance sheet.

Question 5

A trial balance that is in balance (debits equal credits) guarantees that:

Accepted Answer

The mathematical equality of debits and credits is maintained

Answer

A balanced trial balance only confirms that total debits equal total credits; it does not detect errors such as posting to wrong accounts or omitted transactions.

(CAP) Certified Accounting Paraprofessional Practice Test

(CAP) Certified Accounting Paraprofessional Practice Test

CAP Accounting Paraprofessional Skills and Knowledge Covered 5