Robert Half Assessment Test Accounting 3

Question 1

A bank reconciliation is prepared to:

Accepted Answer

Reconcile the difference between book and bank cash balances

Answer

A bank reconciliation identifies and explains differences between the company's cash records and the bank statement balance.

Question 2

Which depreciation method results in the highest depreciation expense in the early years of an asset's life?

Accepted Answer

Double-declining balance

Answer

Double-declining balance is an accelerated method that front-loads depreciation, resulting in higher expense in early years.

Question 3

Petty cash is replenished when the fund runs low. The journal entry to replenish it includes:

Accepted Answer

Debits to expense accounts and a credit to Cash

Answer

Replenishment debits the various expense accounts for items purchased and credits Cash for the total amount reimbursed.

Question 4

What is the purpose of adjusting entries?

Accepted Answer

To update account balances before financial statements are prepared

Answer

Adjusting entries ensure revenues and expenses are recorded in the correct period under accrual accounting before statements are issued.

Question 5

Under the allowance method for bad debts, writing off an uncollectible account:

Accepted Answer

Has no effect on net income or net accounts receivable

Answer

The write-off debits Allowance for Doubtful Accounts and credits Accounts Receivable, leaving net AR and net income unchanged.

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