#1
What is the primary purpose of financial reconciliation?
To ensure accuracy between different financial records
ExplanationVerify precision across various financial documents.
#2
Which of the following is NOT a common financial transaction?
Communication with customers
ExplanationCustomer communication is not a financial transaction.
#3
What is the purpose of a general ledger in accounting?
To record all financial transactions of a business
ExplanationCapturing all business financial transactions.
#4
Which of the following is NOT a common method of payment in financial transactions?
Barter
ExplanationBarter is not a typical financial transaction method.
#5
Which financial statement reports a company's revenues and expenses over a period of time?
Income statement
ExplanationDetails company revenues and expenses over time.
#6
What does the term 'double-entry' refer to in accounting?
Recording each transaction in two separate accounts
ExplanationLogging each transaction in dual accounts for accuracy.
#7
In a bank reconciliation, outstanding checks refer to:
Checks that have been issued by the company but not yet presented to the bank for payment
ExplanationUnprocessed checks issued by the company.
#8
What does the term 'account reconciliation' mean?
Comparing and adjusting the balances in a company's accounting records to ensure accuracy
ExplanationBalancing and correcting accounting records.
#9
Which of the following is an example of an external financial transaction?
Receiving payment from a customer
ExplanationGetting payment from an external source.
#10
What is the purpose of a bank reconciliation statement?
To compare a company's internal records of transactions to the bank statement
ExplanationMatching internal and bank transactions.
#11
Which financial statement helps in reconciling the differences between a company's book balance and bank balance?
Bank reconciliation statement
ExplanationStatement aiding book and bank balance alignment.
#12
What is the purpose of conducting a trial balance?
To identify errors in recording transactions
ExplanationSpotting errors in transaction recording.
#13
What is the purpose of the 'audit trail' in accounting?
To provide a record of all transactions that have occurred
ExplanationOffering a record of all past transactions.
#14
What does EBITDA stand for in finance?
Earnings Before Interest and Taxes, Depreciation, and Amortization
ExplanationTotal earnings before interest, taxes, depreciation, and amortization.
#15
What is the purpose of financial ratio analysis?
All of the above
ExplanationUtilized for various financial analysis purposes.