QuickBooks Transactions and Setup Quiz

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Questions and Answers

What transactions should Adelaide enter first?

Purchase Orders

What can you NOT change after initially setting up a new company?

Industry type

Which of these allows you to track income and expenses for a specific aspect of your company?

Classes

What should you do if you want to use QuickBooks for multiple companies?

Set up a company file for each tax return you will file. Signup and view all the answers

What should Kili do if he doesn't see an industry type that fits his business?

Add your own accounts to the Chart of Accounts after setup is complete. Signup and view all the answers

Match each QuickBooks term to its description.

Advanced Setup = Give more information when creating a company file Start Date = Should not be too far in the past Chart of Accounts = Lists all asset, liability, equity, income, and expense accounts Personal Preference = Controlled by individual users Subaccounts = Can decrease the number of accounts on a P&L report Company Preference = Controlled by the administrator Start Setup = Set up new company file with only basic information Signup and view all the answers

How are contributed reports organized in the Report Center?

By industry type Signup and view all the answers

What should Penelope do to avoid reentering information after upgrading from QuickBooks 2015 to 2019?

Use the Clean Up Company Wizard on the old file and then use it as a template. Signup and view all the answers

Match each account type to its example.

Savings account = Bank Mortgage = Long Term Liability American Express = Credit Card Opening Balance Equity = Equity Prepaid Rent = Company Preference Machinery = Personal Preference Short-Term Loan = Other Current Liability Signup and view all the answers

What task can you NOT do in multi-user mode?

Change a company preference Signup and view all the answers

What statement about moving and sorting accounts in the Chart of Accounts is true?

You can only move accounts within their own type. Signup and view all the answers

How do you ensure users can't enter or change transactions that occurred during the previous fiscal period?

Set a closing date for her account. Signup and view all the answers

What account does QuickBooks create after you set up the first balance sheet account for a company?

Opening Balance Equity Signup and view all the answers

How can you change the beginning balance of an account once it's been created?

Open the account register and change the amount. Signup and view all the answers

Which statement about report email functionality in QuickBooks is true?

Reports are delivered as Word or Excel files. Signup and view all the answers

What type of account is one with the number 61200?

Expense Signup and view all the answers

What should Talihah do to prevent employees from changing company preferences in QuickBooks?

Set them up as users; only the administrator can set company preferences. Signup and view all the answers

In what way can you control what employees access in your QuickBooks file?

You can grant access rights for specific areas to each employee. Signup and view all the answers

What account type is used to track an auto loan?

Long Term Liability Signup and view all the answers

In what order are accounts listed in the Chart of Accounts?

Assets, liabilities, equity, income, cost of goods sold, expenses Signup and view all the answers

How can Miguel set up account numbers in QuickBooks?

Change the preference in the Accounting category on the Company Preferences tab. Signup and view all the answers

When you launch the 'Have a Question?' window, what are the contents based on?

The active window Signup and view all the answers

To include an addition or deduction on an employee's paycheck, you first set it up as a(n):

payroll item Signup and view all the answers

What would you recommend Chau use for shipping products as a QuickBooks user?

Shipping Manager Signup and view all the answers

Where do you go to enter a cash sale?

Sales Receipt Signup and view all the answers

Which of these should be set up as a non-inventory item?

Thread used by a seamstress Signup and view all the answers

How should Ricky track his sales income by product type?

Create income subaccounts for each product type. Signup and view all the answers

How should Clara create her sales tax items in QuickBooks?

Create a tax item for each agency and combine them into a single sales tax group. Signup and view all the answers

Inventory parts are tracked and sold by:

quantity Signup and view all the answers

What report lets Karl compare his QuickBooks inventory to his physical inventory?

Physical Inventory Worksheet Signup and view all the answers

Match each inventory report to its description.

Shows inventory that needs to be ordered = Inventory Stock Status by Item Shows the value of your inventory by item = Inventory Valuation Summary Shows the specifics for transactions that affect inventory value = Inventory Valuation Detail Compares inventory on hand to inventory recorded in QuickBooks = Physical Inventory Worksheet Signup and view all the answers

Why would a company use the batch invoicing feature?

It charges a standard monthly fee for many customers. Signup and view all the answers

How you set up sales tax in QuickBooks depends entirely on:

the states in which you conduct business Signup and view all the answers

Which edition of QuickBooks should Marcus purchase for his small business with nearly a thousand products?

Point-of-Sale Signup and view all the answers

When it comes to inventory, how is profit defined?

the difference between your sales price and cost of goods sold Signup and view all the answers

Where do you enter shipping charges for items received?

The Expenses tab on the Enter Bills window Signup and view all the answers

What does 2% 10 mean in the payment terms 2% 10 Net 30?

If paid within 10 days, the customer receives a 2% discount. Signup and view all the answers

What method of inventory valuation does QuickBooks Pro use?

Average cost Signup and view all the answers

How should Aziz set up QuickBooks to track his inventory?

Create a new inventory item for each object. Signup and view all the answers

How can Lucy efficiently bill her 25 customers for landscape maintenance services?

Create a billing group of the customers and then create a batch of invoices. Signup and view all the answers

What account is debited when a purchase order is created?

No account is debited Signup and view all the answers

What does Javier need to do to accept the discounted payment for 2% 10 Net 30 terms?

In the Pay Bills window, click Discounts and Credits and confirm the amount and account. Signup and view all the answers

Where do you enter a credit from a vendor?

Enter Bills Window Signup and view all the answers

What is the cost of goods sold?

The wholesale purchase price Signup and view all the answers

What account is collected sales tax held in?

Sales Tax Liability Signup and view all the answers

How can Tina incentivize her customer to make timely payments?

Change the terms for the customer to 1% 10 Net 30. Signup and view all the answers

Match each description to its term.

Inventory part = Tracked and sold by quantity Cost of goods sold = Wholesale purchase price of inventory Non-posting account = Doesn't affect what happens behind the scenes Non-inventory part = Item purchased for a specific customer Discount payment terms = Offered to encourage earlier bill payment Signup and view all the answers

Study Notes

Transactions and Company Setup

Enter Purchase Orders first to ensure all transaction details are recorded in QuickBooks.
The industry type cannot be changed after the initial setup of a new company.
Use Classes to track income and expenses for specific areas of a company.
For multiple companies, set up a separate company file for each tax return.

Customizing Accounts

You can add custom accounts to the Chart of Accounts after the initial setup if a suitable industry type isn’t available.
Use Start Date Advanced Setup for additional company file information; ensure not to set it too far in the past.

User Access and Preferences

In multi-user mode, you cannot change company preferences; those are controlled by the administrator.
Access rights can be customized for individual employees to limit what they can see and do in QuickBooks.

Inventory and Sales Tracking

To track sales income effectively, create income subaccounts for different product types.
Inventory parts are tracked by quantity.
The Physical Inventory Worksheet report helps compare physical inventory with QuickBooks records.
Set up shipping charges in the Expenses tab on the Enter Bills window.

Financial Management and Reporting

After establishing the first balance sheet account, QuickBooks creates an Opening Balance Equity account.
The cost of goods sold is defined as the wholesale purchase price of inventory.
Reports generated in QuickBooks can be delivered in Word or Excel format.
Sales Tax Liability account holds collected sales tax.

Billing and Invoice Management

For standard monthly fees paid by many customers, utilize the batch invoicing feature.
Batch invoicing optimizes billing for customers with standard fees, enhancing efficiency.
To improve timely payments, consider changing a customer’s terms to 1% 10 Net 30.

Tax Management and Compliance

Create a separate tax item for each tax agency if operating in areas requiring taxes to multiple agencies.
To manage historical transactions, utilize the Clean Up Company Wizard on old files before setting up new ones.

Payments and Discounts

In the payment terms 2% 10 Net 30, a 2% discount is offered if paid within 10 days.
The discount payment terms can incentivize customers for quicker payments.

Using QuickBooks Features

The Shipping Manager enhances efficiency in order fulfillment and shipping processes.
Change account numbers through the Company Preferences tab in the Accounting category.
Non-inventory items, like thread for seamstresses, should be set up appropriately to track usage without counting as inventory.

Key Account Types

A long-term liability is used to track auto loans and mortgages.
Accounts in QuickBooks are typically listed in the order of assets, liabilities, equity, income, cost of goods sold, and expenses.
Payroll items need to be set up for any additions or deductions on employee paychecks.

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Description

Test your knowledge on QuickBooks transactions and company setup. This quiz covers essential concepts such as purchase orders, class tracking, and customizing accounts. Perfect for users looking to enhance their QuickBooks expertise.