11. A client owns a small vinyl sign printing company called Printing Pros. They completed a print job for a customer on August 10, but the customer did not pay for the service until October 15.
In which month should the revenue be recognized for this big print job?
- September
- August
- October
- End of the year
12. Printing Pros had another big job to do in April and needed to hire additional help to make their deadline. The new employee received their first paycheck at the beginning of May.
When should Printing Pros recognize the expense of paying their employee?
- April
- May
13. According to the Revenue Recognition Principle, when should a business recognize its revenue?
- When it is earned.
- When payment is received from a customer.
- Whenever the reporting period ends.
14. Which of the following best describes the Periodicity Assumption?
- Companies can assume that the business activity will operate indefinitely.
- Companies can assume a value for intangible assets.
- Companies can assume that business activity can be broken up into smaller measurements of time.
15. Which of the following statements would best describe the Matching Principle?
- Expenses should be recognized when they are paid, regardless of when revenue is generated.Â
- The manufacturing cost, or cost of goods sold, is recognized once the manufacturing process is complete.
- Expenses like manufacturing costs or depreciation should be recognized in the same period as the revenue it helped generate.
Accrual vs Cash-Basis Practice Quiz
16. According to the Cash-Basis accounting method, when would a business recognize its expenses?
- When the expense is incurred
- When the business actually receives the bill in the mail
- When the expense is paid out
17. True or False: An advantage of using the Accrual Method of accounting is that it provides a fuller picture of the state of the business.
- False
- True
18. It is permissible to use a combination of the Cash-Basis and Accrual methods of accounting as long as it is applied consistently and clearly and reflects the business's income and expenses.
- True
- False
Shuffle Q/A 2
Bookkeeping Basics Case Study Quiz
19. Instructions: Make sure you have completed the hands-on bookkeeping workbook portion of the course 1 project before starting this quiz. You will need your completed workbook to help you respond to many of the questions.
Lou made _______ in landscaping income in the month of July.
- $4,500
- $4,750
- $5,500
- $5,000Â
20. If Lou makes a $500 payment to the bank for his small business loan, what will be the new loan balance? Assume he is not being charged interest.
- $9,500
- $10,500
- $500
- $10,000