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Answer key
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Answer key
Lesson 1: Getting started
Review questions
1 List the three main ways you enter data in QuickBooks.
Forms, lists, registers
2 List three ways to access features in QuickBooks.
Menu bar, Icon Bar, Centers, Home page
3 What bookkeeping method does QuickBooks use to create most reports?
Accrual, but you can see any report (except transaction reports) on a cash basis by changing
the reporting preference.
4 Which of the following would you not include in the chart of accounts?
a
Checking account
b Vendor record
c
Depreciation Expense
d Accounts Payable
5 Which of the following is an asset?
a
Accounts Payable
b Accounts Receivable
c
Company delivery van
d Both a and b
e
Both b and c
6 Checking, savings, and petty cash should be set up as which of the following
account types in QuickBooks?
a
Expense
b Other current asset
c
Bank
d Equity
7 Which of the following best describes a balance sheet?
a
A summary of a company’s finances over the past year
b A financial snapshot of a company at a specific point in time
c
A summary of a company’s revenue and expenses for a fiscal year
d None of the above
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Answer key
Lesson 2: Setting up QuickBooks
Review questions
1 During the EasyStep Interview, QuickBooks creates income and expense accounts
based on your company’s industry.
2 When setting up a company file in QuickBooks, what does the Start Date signify?
a
The date the business was created
b The first date of the company’s fiscal year
c
The date the company purchased QuickBooks
d The date from which you will be entering transactions in QuickBooks
3 When setting up a company file in QuickBooks at the beginning of a fiscal period,
you would normally select which of the following as the start date?
a
The first day of the current fiscal period
b The last day of the previous fiscal period
4 True or false: Once you have set up the chart of accounts, you cannot add, delete, or
modify accounts.
a
True
b False
5 Before working in QuickBooks, you need to enter an opening balance for each
account.
6 True or false: Choosing a company organization associates a tax form with your
business in the QuickBooks file.
a
True
b False
7 In QuickBooks, linking income and expense accounts with tax lines does which of
the following?
a
Helps keep your company profitable
b Helps in preparing income taxes
c
Helps keep track of sales taxes you owe
d Both B and C
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Answer key
Lesson 3: Working with lists
Review questions
1 How many custom fields can you set up for items?
a
4
b 5
c
7
d 20
2 Which of the following forms and windows could potentially be populated with
information from the Vendor list?
a
Purchase orders
b Bills
c
Write Checks
d All of the above
3 Which of the following activities cannot be accessed from the Customers & Jobs list
in the Customer Center?
a
Create statements
b Assess finance charges
c
Enter credit card charges
d Receive payments
4 On which tab of the Edit Customer window would you enter a customer’s payment
terms (for example, Net 30 Days)?
a
Address Info
b Additional Info
c
Payment Info
d Job Info
5 A customer has three warehouses and you are installing an overhead door at each
location. The best way to track this in QuickBooks would be to:
a
Set up each location as a separate customer
b Set up a separate job for each location under the customer
c
Enter all work as one order under the customer
d Use a custom field to track each location
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6 Products you sell would appear on which of the following lists?
a
Vendor list
b Employee list
c
Chart of Accounts
d Item list
7 A subcontractor would appear on which of the following lists?
a
Vendor list
b Employee list
c
Customers & Jobs list
d Item list
8 Name at least three lists on which you can merge items.
a
Chart of accounts
b Item
c
Customers & Jobs
d Vendor
e
Employee
f
Other Names
9 True or false: You can delete list items that are used in transactions.
a
True
b False. You cannot delete items used in transactions, but you can make them inactive.
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Answer key
Lesson 4: Working with bank accounts
Review questions
1 What does the ending balance in a QuickBooks bank account register represent?
a
Only transactions that have been printed
b All transactions entered in the register, including checks that haven’t yet been printed
2 What preference allows you to have QuickBooks prefill the amount from the
previous transaction with a payee?
a
Automatically prefill last amount for this payee
b Automatically prefill last amount for this name
c
Automatically recall last transaction for this name
d Automatically recall previous transaction for this payee
3 What preference allows you to have QuickBooks prefill the expense account from
previous transactions with a vendor?
a
Automatically prefill last account for this vendor
b Prefill accounts for vendor based on past transactions
c
Automatically recall last transaction for this vendor
d Prefill accounts for this payee based on the last transaction
4 True or false: All income and expense accounts have a register associated with them
in QuickBooks.
a
True
b False. Only balance sheet accounts (excluding Retained Earnings) have registers
associated with them.
5 Reconciling is the process of making sure that your checking account record matches
the bank’s record.
6 How can you determine whether or not a check has been cleared in QuickBooks?
a
A checkmark displays in the bank account register
b The word “Cleared” is stamped on the check in QuickBooks
c
All of the above
d None of the above
7 True or false: If you are tracking bills with Accounts Payable and have already
entered a bill, you should pay the bill by writing a check from the Write Checks
window.
a
True
b False. You should use the Pay Bills window to write the check.
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Answer key
8 Which of the following might affect a bank account reconciliation?
a
Interest
b Depreciation
c
Service charges
d Both a and c
e
All of the above
9 When would you not want to use the Write Checks window when paying bills?
a
When paying sales tax
b When paying payroll taxes
c
When using a handwritten check
d When paying bills you track with Accounts Payable
e
None of the above
f
Both a and b
g a, b, and d
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Answer key
Lesson 5: Using other accounts in QuickBooks
Review questions
1 Accumulated depreciation is typically set up as what type of account in
QuickBooks?
a
A subaccount of a fixed asset account
b A subaccount of a current asset account
c
A subaccount of a liability account
d An expense account
2 Equity type accounts would be used to track which of the following?
a
Capital investments
b Draws
c
Retained Earnings
d All of the above
3 Which of the following would likely be considered a long-term liability?
a
Vehicle loan
b Accounts payable
c
Rent
d Credit card account
4 Retained Earnings is defined as which of the following?
a
The amount of money that a business retains for paying its employees
b The earnings from non-essential business services
c
The amount of interest saved from paying off a loan early
d The accumulation of a company’s net income or loss from its start date
5 Which of the following would not decrease the value of a company’s equity?
a
The company paying corporate dividends
b The company incurring a net loss for the fiscal year
c
An owner drawing money out of the company
d The company taking a loan out to purchase a new asset
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Answer key
Lesson 6: Entering sales information
Review questions
1 When receiving payment at the time of sale, you create a sales receipt in QuickBooks.
2 When customers are returning items, you record the return on a credit memo.
3 In QuickBooks, you can record payments made using which of the following?
a
Cash
b Check
c
Credit card
d All of the above
4 Which item type should you use when recording a partial payment from a customer
on an invoice?
a
Subtotal
b Payment
c
Service
d Non-inventory Part
5 True or false: QuickBooks lets you save sales forms as PDF files.
a
True
b False
6 If you regularly invoice a customer for similar items or services, you can memorize
the invoice to save time.
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Answer key
7 From which list (or lists) does QuickBooks get the information for A, B, and C in the
graphic below?
a
Customers & Jobs list
b Customers & Jobs list (if associated terms with the customer); Terms list
c
Item list
A
B
C
8 List the item types used in the line item area of the invoice above.
Inventory Part, Subtotal, Discount, and Service.
9 On which of the following can you not use price levels?
a
Invoices
b Sales receipts
c
Credit memos
d Purchase orders
10 QuickBooks: Pro allows you to assign price levels to which of the following?
a
Specific customers
b Individual line items on sales forms
c
Both a and b
d None of the above
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Answer key
11 If a wood door costs $120.00 and you set the rounding option to 1.00 minus .11,
what price would appear on an invoice for the wood door?
a
$120.11
b $120.89
c
$119.89
d $119.11
12 True or false: Price levels affect Discount items.
a
True
b False (Price levels only affect Service, Inventory, Non-Inventory Part, and Inventory
Assembly items)
13 Which of the two methods described in this lesson for providing customers with
information about overdue invoices allows you to assess finance charges?
a
Invoice letters
b Reminder statements
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Answer key
Lesson 7: Receiving payments and making
deposits
Review questions
1 A company has set up three different jobs for a single customer. The customer writes
one check to make a partial payment on open balances for all three jobs. In
QuickBooks, that payment...
a
Must be applied to the first invoice for the first job for the customer
b Must be applied to the most recent invoice for the customer
c
Can be applied to any combination of invoices and jobs for the customer
d Cannot be applied to any invoices or jobs for the customer until full payment is
received
2 QuickBooks supports which of the following types of payment scenarios?
a
Down payments for products or services
b Overpayments from customers
c
Partial payments from customers
d All of the above
3 True or false: You can enter a customer payment directly in the customer register.
a
True
b False. You must enter payments in the Receive Payments window.
4 The Undeposited Funds account acts like a “cash drawer” and is used to hold funds
until you deposit them into a bank account.
5 True or false: QuickBooks allows you to print deposit slips that you can take to the
bank.
a
True
b False
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Answer key
Lesson 8: Entering and paying bills
Review questions
1 You use the accounts payable account to track money that you owe to vendors.
2 List the two steps involved in using the accounts payable features in QuickBooks:
a
Enter bills
b Pay bills
3 When you make a payment (from the checking account) in the Pay Bills window,
you can see the transactions in the checking and accounts payable registers.
4 True or false: When tracking accounts payable in QuickBooks, the Enter Bills
window is the only place you can enter bills and vendor credits.
a
True
b False. You can also enter bills and vendor credits directly in the accounts payable
register, which may allow for faster data entry.
5 Which of the following tasks can you perform in the Pay Bills window?
a
Enter a partial payment on an outstanding bill
b Make a payment using a credit card
c
Pay all outstanding bills
d All of the above
6 You paid a vendor $1,000.00 through the Pay Bills window (using the Checking
account). QuickBooks automatically creates a journal entry that:
a
Deletes the bill
b Shows $1,000.00 as a Credit in Accounts Payable and shows $1,000 as a Debit in
the Checking account.
c
Shows $1,000.00 as a Debit in Accounts Payable and shows $1,000 as a Credit in the
Checking account.
d Shows $1,000.00 as a Debit in Accounts Payable and shows $1,000 as a Credit in
the Accounts Receivable.
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Answer key
Lesson 9: Analyzing financial data
Review questions
1 QuickZoom is the tool that allows you to drill down on summary reports and graphs
in QuickBooks.
2 When can you generate a QuickReport?
a
Only when viewing an active customer or account
b Only when viewing a list, register, or form
c
Only at the end of the current fiscal period
d Only when viewing balance sheet accounts
3 In which report category would you find the a list of open invoices?
a
Company & Financial
b Sales
c
Customers & Receivables
d List
4 Report filters let you set custom criteria for the transactions you want to include in a
report.
5 Once you’ve customized a preset report to meet your needs, how can you save your
settings so you don’t have to customize the report each time you run it?
a
Choose Save Settings from the Report menu
b Choose Save Setting from the File menu
c
Click Memorize on the button bar
d Click Modify, and then choose Memorize
6 True or false: Once you’ve exported report data to Excel, you can send modified data
back to QuickBooks.
a
True
b False
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Answer key
Lesson 10: Setting up inventory
Review questions
1 True or false: The Purchase Orders account does not affect the balance sheet or
income statement.
a
True
b False
2 You placed an order with a vendor for inventory parts. The items have arrived, but
you have not received the bill yet. Which option should you choose from the
Vendors menu?
a
Enter bills
b Receive items and enter bill
c
Receive items
d Enter bills for items received
3 True or false: You must have inventory items on hand before you can enter a sale for
them.
a
True
b False
4 You complete a physical inventory and discover that you have five more of a
particular item than show in QuickBooks. How do you update the inventory records
in QuickBooks?
a
Complete the physical inventory worksheet
b Enter an item receipt
c
Adjust the quantity using the Adjust Quantity/Value on Hand window
d None of the above
5 Which of the following provide you with a list of all purchase orders created in a
file?
a
QuickReport on the Purchase Orders account
b Purchase Orders list report
c
Open Purchase Orders
d All of the above
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Answer key
Lesson 11: Tracking and paying sales tax
Review questions
1 Which of the following statements is false?
a
You can set up both taxable and non-taxable items
b You can associate different sales tax rates with different customers
c
QuickBooks automatically sets up your sales tax rates based on the city and state you
enter in the Company Information window.
d All of the above
2 Use a sales tax group item to combine multiple sales tax items into one amount on
sales forms.
3 Which of the following can you use to determine your sales tax liability?
a
Sales Tax Payable account register
b Pay Sales Tax window
c
Sales tax liability report
d All of the above
4 To correctly affect sales tax liability, you should make payments to tax collecting
agencies from which QuickBooks window?
a
Write Checks
b Pay Sales Tax
c
Either a or b
d None of the above
5 In what part of the program do you assign sales tax codes and items to customers?
a
In the Sales Tax Code list
b On the Customer tab of the New or Edit Item window
c
On the Additional Info tab of each customer’s record in the Edit Customer window
d None of the above
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Answer key
Lesson 12: Doing payroll with QuickBooks
Review questions
1 What is required in order for QuickBooks to calculate payroll?
Tax tables
2 Which two accounts are typically linked to payroll items?
a
Payroll Liabilities
b Payroll Expenses
3 Which of the following are QuickBooks payroll item types?
a
Compensation
b Paid Time Off
c
Retirement Benefits
d All of the above
4 What report would you run to determine how much you owe in payroll taxes?
Payroll Liability Balances
5 What QuickBooks feature would you use to make setting up payroll easier when a
number of employees have the same hourly wage, payroll schedule, and base
deductions?
a
Tax tables
b Employee defaults
c
Payroll items
d Assisted payroll
6 True or false: Payroll schedules are required to run payroll in QuickBooks.
a
True
b False. You can still run payroll using Special Payroll in the Payroll Center.
7 Payroll schedules help you do which of the following?
a
Group employees with the same pay frequency
b Write bonus checks
c
Prepare termination checks
d Pay payroll tax liabilities
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Answer key
Lesson 13: Estimating and progress invoicing
Review questions
1 QuickBooks tracks estimates using what kind of account?
a
Posting
b Non-posting
2 True or false: QuickBooks allows you to create multiple estimates for a single
customer.
a
True
b False
3 Which of the following is not an option when creating an invoice from an estimate?
a
Create an invoice for the entire estimate
b Create an invoice for a percentage of the entire estimate
c
Create an invoice for selected items or different percentages of each item
d None of the above
4 You prepared an estimate for a customer and were subsequently awarded the
contract. How would you change the job status from “Pending” to “Awarded?”
a
Create the invoice from the accepted estimate—this changes the status
automatically
b Use the Job Status drop-down list in the customer’s record
c
Use the Job Status drop-down list in the Create Estimates window
d None of the above
5 What QuickBooks feature would you use to charge customers as you complete
various phases of a job?
a
Progress invoicing
b Phased invoicing
c
Partial invoicing
d None of the above
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Answer key
Lesson 14: Tracking time
Review questions
1 List four ways to enter time in QuickBooks.
a
Weekly timesheet
b Time/Enter Single Activity window
c
The Timer application available with QuickBooks: Pro and higher editions
d QuickBooks Time Tracker (additional requirements, terms, conditions, and fees apply)
2 For which of the following can the time tracking features in QuickBooks not be
used?
a
Notifying you that more staffing is required for a given project
b Tracking the cost of an employee’s gross pay by job
c
Providing hours worked on an employee’s paycheck
d Invoicing customers based on time spent on a job
3 Which report would you use to determine how many hours were spent on each
activity and whether or not the customer had been billed for the time?
a
Time by item
b Time by name
c
Time by job summary
d Time by job detail
4 When paying owners or partners, you should use an equity account to track the
payment.
5 Which of the following is a step involved in the process for invoicing a customer for
time worked?
a
Select the customer’s name in the Create Invoices window
b Click Add Time/Costs
c
In the Choose Billable Time and Costs window, click to select the items you
want to transfer to the invoice
d All of the above
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Answer key
Lesson 15: Customizing forms and writing
QuickBooks Letters
Review questions
1 List three forms that can be customized in QuickBooks:
a
Invoice
b Sales receipt
c
Credit memo
d Statement
e
Purchase order
f
Estimate
g Sales order (available in Premier and higher editions only)
2 True or false: The column order on QuickBooks forms is fixed and cannot be
changed.
a
True
b False
3 You use the Layout Designer window to move and resize fields on forms.
4 You can add fields from which of the following lists to QuickBooks Letters?
a
Customers & Jobs
b Employee
c
Vendor
d All of the above
5 True or false: You can convert an existing Microsoft Word document into a
QuickBooks Letter to which you can add QuickBooks data.
a
True
b False
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