#1
Which of the following is a primary purpose of small business accounting?
To track revenue and expenses
ExplanationTo monitor financial activities and performance.
#2
What is the deadline for filing federal income tax returns for most small businesses?
April 15
ExplanationStandard tax filing deadline.
#3
Which of the following is a common accounting software used by small businesses?
QuickBooks
ExplanationPopular software for financial management.
#4
Which of the following is an example of a current asset?
Accounts receivable
ExplanationShort-term assets.
#5
Which of the following is an example of an operating expense?
Salary of sales staff
ExplanationCosts related to core business activities.
#6
Which of the following is a deductible business expense for tax purposes?
Employee salaries
ExplanationExpense that reduces taxable income.
#7
What is the purpose of the balance sheet in small business accounting?
To list all assets, liabilities, and equity
ExplanationSnapshot of the business's financial position.
#8
What is the purpose of the cash flow statement in small business accounting?
To track the flow of cash in and out of the business
ExplanationShows sources and uses of cash.
#9
Which accounting method records income and expenses when they are incurred, regardless of when cash is exchanged?
Accrual basis accounting
ExplanationRecords transactions when they occur.
#10
What is the purpose of the profit and loss statement in small business accounting?
To track income and expenses over time
ExplanationSummarizes financial performance.
#11
What is the purpose of the general ledger in small business accounting?
To record all financial transactions
ExplanationCentralized record of transactions.
#12
Which of the following is an example of a tax deduction for small businesses?
Health insurance premiums
ExplanationExpense that reduces taxable income.
#13
What is the purpose of depreciation in small business accounting?
To reduce taxable income
ExplanationSpread the cost of assets over time.
#14
Which form is commonly used by small businesses to report their annual income to the IRS?
Form 1120
ExplanationIRS form for corporate income tax.
#15
Which of the following is an example of a contra-asset account?
Accumulated depreciation
ExplanationOffset against an asset account.
#16
Which accounting principle requires that expenses be recorded when they are incurred, regardless of when cash is exchanged?
Matching principle
ExplanationExpense recognition principle.