Robert Half Assessment Test Accounting 2 — Questions and Answers
Question 1: A company purchases equipment for $50,000 with a salvage value of $5,000 and a useful life of 9 years. What is the annual straight-line depreciation?
- $5,000 (Correct answer)
- $5,556
- $4,500
- $6,250
Correct answer: $5,000
Straight-line depreciation = (Cost − Salvage) / Useful life = ($50,000 − $5,000) / 9 = $5,000 per year.
Question 2: Which financial statement shows a company's revenues and expenses over a specific period?
- Balance Sheet
- Statement of Cash Flows
- Income Statement (Correct answer)
- Statement of Retained Earnings
Correct answer: Income Statement
The Income Statement (Profit & Loss Statement) reports revenues, expenses, and net income for a defined accounting period.
Question 3: Under the accrual basis of accounting, revenue is recognized when:
- Cash is received
- The invoice is mailed
- It is earned, regardless of when cash is received (Correct answer)
- The customer places an order
Correct answer: It is earned, regardless of when cash is received
Accrual accounting requires revenue recognition when earned and realizable, not when cash changes hands.
Question 4: What does a credit entry to Accounts Receivable indicate?
- A new sale on account
- A customer payment received (Correct answer)
- An increase in revenue
- A purchase return
Correct answer: A customer payment received
Crediting Accounts Receivable reduces the asset balance, which occurs when a customer pays their outstanding balance.
Question 5: The FIFO inventory method assumes that:
- The most recently purchased items are sold first
- Average cost items are sold first
- The oldest inventory items are sold first (Correct answer)
- Items are sold in random order
Correct answer: The oldest inventory items are sold first
FIFO (First-In, First-Out) assumes the oldest inventory purchased is the first to be sold and expensed.
Question 6: Which of the following is an example of a contra asset account?
- Accounts Payable
- Accumulated Depreciation (Correct answer)
- Unearned Revenue
- Common Stock
Correct answer: Accumulated Depreciation
Accumulated Depreciation offsets the related fixed asset account, making it a contra asset with a normal credit balance.
Question 7: If total assets are $200,000 and total liabilities are $75,000, what is stockholders' equity?
- $275,000
- $125,000 (Correct answer)
- $75,000
- $200,000
Correct answer: $125,000
Using the accounting equation: Equity = Assets − Liabilities = $200,000 − $75,000 = $125,000.
Robert Half Assessment Test Accounting 2
A company purchases equipment for $50,000 with a salvage value of $5,000 and a useful life of 9 years.
What is the annual straight-line depreciation?