Robert Half Assessment Test Accounting 2

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?

Accepted Answer

$5,000

Answer

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?

Accepted Answer

Income Statement

Answer

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:

Accepted Answer

It is earned, regardless of when cash is received

Answer

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?

Accepted Answer

A customer payment received

Answer

Crediting Accounts Receivable reduces the asset balance, which occurs when a customer pays their outstanding balance.

Question 5

The FIFO inventory method assumes that:

Accepted Answer

The oldest inventory items are sold first

Answer

FIFO (First-In, First-Out) assumes the oldest inventory purchased is the first to be sold and expensed.

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