Robert Half Assessment Test Core Accounting Principles 2

Question 1

Under the accrual basis of accounting, revenue is recognized when:

Accepted Answer

It is earned, regardless of when cash is received

Answer

Accrual accounting recognizes revenue when it is earned (goods delivered or services performed), not when cash changes hands.

Question 2

Which financial statement shows a company's financial position at a specific point in time?

Accepted Answer

Balance sheet

Answer

The balance sheet (statement of financial position) presents assets, liabilities, and equity as of a specific date.

Question 3

A company purchased equipment for $50,000 cash. How does this affect the accounting equation?

Accepted Answer

One asset increases $50,000; another asset decreases $50,000

Answer

Buying equipment for cash swaps one asset (cash) for another (equipment), keeping total assets unchanged.

Question 4

The matching principle requires that:

Accepted Answer

Expenses are recorded in the same period as the revenue they helped generate

Answer

The matching principle ties expense recognition to the period in which the associated revenue is earned.

Question 5

Which of the following is an example of a contra asset account?

Accepted Answer

Accumulated depreciation

Answer

Accumulated depreciation offsets the gross cost of a fixed asset and carries a credit balance, making it a contra asset.

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