QBO Skills practice questions

Vendor expenses: bills, checks, cards, billable costs & 1099s

10 practice questions on vendor expenses: bills, checks, cards, billable costs & 1099s, each with the answer and why it is right. From Questiva Learning' QuickBooks® Online skills test. The topic is covered in Chapter 5 of QuickBooks® Online Step-by-Step.

1. A vendor's invoice arrives, and you won't pay it until next month. You enter it as:

   1. An Expense.
   2. A Check dated next month.
   3. A Purchase Order.
   4. A Bill.

   Answer: D) A Bill.. Vendors send invoices, but in QuickBooks® Online you enter them as Bills. The Bill holds what you owe in Accounts Payable until you pay it in Pay Bills. (Chapter 5 · Entering Bills)

2. If you write a Check instead of paying a vendor's open bill:

   1. The bill is marked paid.
   2. The bill stays open, and accrual reports show the expense twice.
   3. Nothing posts until you match the check in the Bank Transactions feed.
   4. QuickBooks® applies the check to the bill on its own.

   Answer: B) The bill stays open, and accrual reports show the expense twice.. The check posts as a second expense. Click Add in the drawer beside the check to turn it into a bill payment. (Chapter 5 · Applying a Check to an Unpaid Bill)

3. Charges on the company credit card are entered as:

   1. A Bill to the store.
   2. A Transfer from Checking to the credit card account.
   3. An Expense, with the card as the Payment Account.
   4. A Check from Checking.

   Answer: C) An Expense, with the card as the Payment Account.. Record each card charge as an Expense with the credit card as the Payment Account. It raises the card balance and the expense together. (Chapter 5 · Entering Expenses)

4. You paid the company Visa through the bank's website. To record the payment:

   1. Enter an Expense from Checking to Credit Card Expense.
   2. Use Pay Down Credit Card.
   3. Re-enter each charge from the statement on one Expense.
   4. Make a Journal Entry to Interest Expense.

   Answer: B) Use Pay Down Credit Card.. The charges were expensed when you entered them. Paying the card only moves money from Checking to the Visa, and Pay Down Credit Card records just that. (Chapter 5 · Paying the Credit Card Balance)

5. To pass a purchase on to a customer's next invoice, on the expense you:

   1. Pick the customer and check Billable.
   2. Code it to Cost of Goods Sold.
   3. Pick the customer but leave Billable unchecked.
   4. Put the customer's name in the Payee field.

   Answer: A) Pick the customer and check Billable.. The Customer column tracks the cost by job, and the Billable checkmark passes it on to the customer's next invoice, with or without markup. (Chapter 5 · Tracking Job Costs)

6. If you enter a vendor's unpaid bills in the Opening Balance field and then enter them again as Bills:

   1. QuickBooks® matches the bills to the opening balance.
   2. The bills stay hidden in Pay Bills until the opening balance is paid.
   3. QuickBooks® won't let you save the bills.
   4. Accounts Payable shows the debt twice.

   Answer: D) Accounts Payable shows the debt twice.. The Opening Balance field creates its own Bill, coded to Miscellaneous Expense. Leave it blank and enter each unpaid bill instead. (Chapter 5 · Adding New Vendors)

7. To make a partial payment on a bill:

   1. Enter the amount in the Payment column of Pay Bills.
   2. Edit the bill to the amount you're paying.
   3. Write a check coded to Accounts Payable and delete the bill.
   4. Enter a Vendor Credit for the rest, then pay the bill in full.

   Answer: A) Enter the amount in the Payment column of Pay Bills.. Pay Bills accepts a partial payment. QuickBooks® Online keeps tracking the rest in Accounts Payable, and the bill shows its balance due next time you open Pay Bills. (Chapter 5 · Paying Bills)

8. A 0.00 total for a vendor on the A/P Aging Summary means:

   1. The bills are dated in a closed period.
   2. The bills aren't due yet.
   3. The bills were Due on Receipt and aged off the report.
   4. A payment wasn't applied to the bill.

   Answer: D) A payment wasn't applied to the bill.. A zero total means the vendor has bills and payments or credits on file that were never applied to each other. Apply the payment to the bill to clear them. (Chapter 5 · The A/P Aging Summary Report)

9. Which report lists checks written straight to a vendor, without a bill?

   1. Vendor Balance Detail.
   2. Accounts Payable Aging Detail.
   3. Transaction List by Vendor.
   4. Bills and Applied Payments.

   Answer: C) Transaction List by Vendor.. Checks written straight to a vendor never go through Accounts Payable, so the A/P reports leave them out. Transaction List by Vendor shows them all. (Chapter 5 · Transaction List by Vendor)

10. How do you record an ATM withdrawal for petty cash and the purchases paid from it?

    1. A Transfer, then an Expense from Petty Cash for each purchase.
    2. Code the ATM withdrawal to an expense account.
    3. A Transfer, then a Bill to each store.
    4. One Expense from Checking, split across the categories on the receipts.

    Answer: A) A Transfer, then an Expense from Petty Cash for each purchase.. Cash taken out of the bank is a Transfer, not an expense. Each purchase is then an Expense paid from Petty Cash, so the account matches the cash in the box. (Chapter 5 · Handling Petty Cash)