Deck 6: Vendors and Expenses

Question 1

QBO considers all of the following to be vendors except:

A)Utility and telephone companies.
B)Tax agencies (i.e.IRS).
C)Employees providing specific services to the company (i.e.IT department).
D)Financial institutions (i.e.banks).

Answer 1

C

Question 2

In QBO,what onscreen form do you use to select bills that are due and ready to pay?

A)Check form
B)Expense form
C)Pay Bills form
D)Cash form

Answer 2

C

Question 3

Which of the following is NOT correct regarding a 1099?

A)A vendor's Tax ID No.is required to complete the 1099.
B)The 1099 Forms are required to be sent to the SEC to maintain compliance as a registered public company.
C)QBO can assist in tracking amounts and preparing 1099s for appropriate vendors.
D)It is an IRS Form commonly prepared by a business every year.

Answer 3

B

Question 4

In what situation would you NOT use the Pay Bills form?

A)When a bill is due and must be paid.
B)If the Expense form or Check form was used to enter the vendor transaction.
C)When a company is ready to pay its accounts payable.
D)When the bill has been entered using the Bill form.

Question 5

Which of the following is true regarding recording an accounts payable transaction?

A)When a purchase is made,accounts payable is increased with a debit and when the bill is paid,accounts payable is decreased with a credit.
B)Accounts payable transactions arise solely from inventory purchases and not service related payments.
C)Accounts payable represents a note; a vendor ensures we sign an agreement with interest paid.
D)When a purchase is made,accounts payable is increased with a credit and when the bill is paid,accounts payable is decreased with a debit.

Question 6

What is a mechanism used by a company to track amounts it owes vendors?

A)Accounts Payable Aging Report.
B)Accounts Receivable Aging Report.
C)Accounts Payable Reconciliation Report.
D)Cash to Payables Reconciliation.

Question 7

In QBO,the process for updating the Vendors List While entering transactions is:

A)Use the Create (+)icon to find the appropriate onscreen form.Then select Choose a payee drop-down arrow > + Add new and enter the new vendor information.
B)Select the Gear icon and then Choose a payee drop-down arrow > + Add new and entering the new vendor information.
C)Select the Gear icon and then select Create (+)which allows the user to Choose a payee drop-down arrow > + Add new and enter the new vendor information.
D)Select the Create (+)icon and then Choose a vendor drop-down arrow > + Add new and entering the new vendor information.

Question 8

Which is NOT true regarding the Accounts Payable Aging Report?

A)It provides information to track amounts we owe our vendors.
B)It summarizes accounts payable balances by age of the account.
C)It tracks how much we owe vendors and the amounts due including past due balances.
D)It ensures a company is aware of the credit limit it has with each vendor.

Question 9

QBO uses following process to update a Vendors List Before entering transactions:

A)At the Navigation Bar click on Expenses,then select Vendors and New vendor.Editing an existing vendor,entering a new transaction,or entering a new vendor can be performed by either selecting Edit or New transaction,appropriately.
B)At the Navigation Bar click on Expenses,then select Vendors and New vendor.Enter a new vendor by selecting New transaction.Editing a vendor must be performed in a different screen using Create (+).
C)At the Navigation Bar click on Purchases,then select Edit vendors.Editing an existing vendor or entering a new vendor can be performed by either selecting Edit or New transaction as appropriate.
D)At the Navigation Bar click on Accounting,then select Vendors and New vendor.Editing an existing vendor or entering a new vendor can be performed by either selecting Edit or New transaction.

Question 10

In QBO,what is the difference between the vendor transaction Bill and Expense?

A)Expense - records services received that will be paid for later thus creating an account payable.
Bill - record expenses paid for using cash,check or credit card at the time a product or service is received.
B)Expense - record expenses paid for in cash,check or credit card at the time the product or service is received.
Bill - tracks products ordered from vendors which will be billed when received.
C)Expense - records a vendor refund received which reduces what a company owes the vendor.
Bill - record services received that will be paid for later creating an account payable.
D)Expense - record expenses paid for using cash,check or credit card at the time a company receives the product or service.
Bill - record services received that will be paid for later creating an account payable.

Question 11

When is the Bill onscreen form used to record a vendor transaction in QBO?

A)It is used to record services for which a company has been billed for and agreed to pay later.
B)It is used to record expenses a company pays for at the time it receives the product or service.
C)It is used when a vendor gives a refund or reduction in a bill for what is owed to the vendor.
D)It is used to record a credit or a reduction in the charges owed to the vendor.

Question 12

All of the following are advantages associated with using QBO Vendors List except:

A)Allows the company to store information regarding its vendors including: name,address,and contact information.
B)Allows a company to assess the quality of the material received from each vendor.
C)It is a time-saving feature.
D)QBO automatically transfers the vendor information to the appropriate form i.e.checks.

Question 13

How does an account payable arise with a vendor?

A)When our business makes a cash purchase,it promises to pay the same amount again for future purchases.
B)When our customers purchase amounts from us,they promise to pay us in the future.
C)When we return purchases to our vendor,they promise to pay us for the amounts returned.
D)When our business purchases on credit,it promises to pay that amount in the future.

Question 14

When using the Navigation Bar to enter expense transactions in QBO,a user must perform the following:

A)Select Create (+)and click on the drop down arrow for New transaction.Next,select the type of transaction and complete the online form.
B)Select Expenses and click on the drop-down arrow for New transaction.Next,select the type of new transaction and complete the online form.
C)Select Accounting and select New transaction from the Vendors transaction selection shown.
D)Select Create (+)and select New transaction from the Vendor transactions shown.

Question 15

All of the following onscreen forms and sequences are ways to record vendor and expense transactions in QBO except:

A)Bills > Pay Bills
B)Bill > Purchase Order > Pay Bills
C)Expense
D)Check

Question 16

What is an accounts payable?

A)Amounts a customer owes our business from a credit sale where the customer promises to pay later.
B)Amounts our company has already payed to our vendors.
C)Amounts our business is obligated to pay in the future.
D)Amounts our company must return to our vendor if discounts are not granted on our purchases.

Question 17

How does QBO define a vendor?

A)Any individual or organization that provides products or services to a company.
B)Any individual working for the corporation on a contract or employee basis (not organizations).
C)An organization providing services to a company (not individuals).
D)Individual industrial suppliers to an organization.

Question 18

What is a 1099 and when is it prepared?

A)A 1099 is an IRS Form completed for sole proprietorships and partnerships that a company paid $600 or more for services in a year.
B)An IRS Form completed for corporations that another company paid $600 or more for services in a year.
C)An IRS Form completed for individuals a company paid $6,000 or more for services in a year.
D)An IRS Form completed for sole proprietorships and partnerships a company paid $60 or more for services in a year.

Question 19

In QBO,what is the difference between a Bill form and an Expense form?

A)A Bill form records a services the company has received and has an obligation to pay the vendor later.An Expense form selects the bills a company wants to pay.
B)A Bill form records when the vendor gives the company a refund or reduction in its bill.An Expense tracks the products ordered from the vendor.
C)A Bill form records expenses paid for at the time the product or service is received via paying cash,check or credit card.An Expense form records services the company has received and has an obligation to pay the vendor later.
D)A Bill form records a service the company has received and has an obligation to pay the vendor later.An Expense form records expenses paid for at the time the product or service is received via paying cash,check or credit card.

Question 20

In QBO,the Check form is used if:

A)We receive a bill and plan to pay later by check.
B)Our payment is made by check at the same time we make a purchase.
C)Our payment is made at the same time we make a purchase and we pay by credit card.
D)Our payment is made at the same time we make a purchase and we pay by cash.