Financing and Budgeting
1. Which one of the following categories makes up the largest percentage of a child care operating budget?
B. Salaries and benefits
D. Mortgage or rent
2. Child care operating budgets generally contain a pro forma income statement. To prepare this statement, you must first prepare budgets for _______ and _______.
A. estimated income; actual income
B. estimated expenditures; actual expenditures
C. revenues; expenses
D. income; reserves
3. Registration fees usually range from _______ to _______.
A. $15; $50
B. $25; $75
C. $45; $90
D. $50; $100
4. A full-charge bookkeeper
A. is a CPA.
B. is a tax expert.
C. can prepare financial statements.
D. must have child care experience.
5. An aging of accounts receivable performed on April 20 reveals that one of your customers has owed you $325 since January 15. Which of the following alternatives should you pursue?
A. Offer additional credit to your clients.
B. Turn the account over to a collection agency.
C. Telephone the customer on a daily basis.
D. Send the customer threatening letters.
6. Which one of these categories would most likely be found in the operating budget of a day care center?
A. Tables and chairs for classrooms
B. Desks and chairs for the office
C. Deposits for utility services
D. Loan payments
7. If an employer fails to pay state unemployment taxes on a timely basis, the rate on FUTA taxes will
A. remain the same.
B. be lower.
C. increase by 100 percent.
8. Consider these three factors: amount reasonable for type of child care program used, amount necessary to meet financial commitment, and amount charged for other local programs. These factors are used to determine
A. consultant fees.
B. the startup budget.
C. accounts payable.
D. the tuition rate.
9. Which of the following financial statements includes the assets, liabilities, and equity accounts of a business?
A. Income statement
B. Balance sheet
C. Operating budget
D. Form W-4
10. This financial ratio measures the business's liquidity:
A. days receivable ratio.
B. average daily rate ratio.
C. current ratio
D. profit margin.
11. The Average Daily Rate ratio, often used by outsiders as an evaluation of how much revenue is earned each day, is usually calculated on the basis of how many days?
A. 360 days
B. Number of days a child care facility is open
C. 365 days
D. 30 days
12. In the child care business, the term accounts receivable will probably consist of
A. government grants.
B. equipment costs.
C. the system of accounting used by the business.
D. registration and tuition fees.
13. The Income Statement for Tiny Tykes Day Care reveals total revenues of $181,575 and total expenses of $159,657. The profit margin for Tiny Tykes is
D. impossible to determine from the information given.
Questions 14 and 15 are based on Exam Figure A. Fill in the missing lines in the balance column of this figure. Then answer Questions 14 and 15.
EXAM FIGURE A—An Individual Customer's Account Receivable
14. What was the family's balance after paying you on Jan. 16, 20XX?
15. What is the family's current (most recent) balance?
16. The Balance Sheet for ABC Day Care has Total Assets of $195,400, Total Liabilities of $129,500, and Total Owner's Equity of $57,300. What can we say about ABC Day Care?
A. It's a very successful business.
B. It has too much debt.
C. Someone made a mistake doing its Balance Sheet.
D. Someone stole $8,600 from ABC.
Use the following table to fill in the Income Statement in Exam Figure B. Then answer Question 17 below.
17. After completing the form in Exam Figure B, you find that there is _______ for the period from September 1 through September 30.
A. a profit of $95.30
B. a loss of $95.30
C. a loss of $4.70
D. no profit or loss
EXAM FIGURE B—Use this figure to answer Question 17.
18. You, the owner of XYZ Day Care, buy a new van for your business. The van costs $20,000, all of which you borrow from First American Bank. Which of the following correctly describes the journal entry for this transaction?
A. $20,000 debit to Vehicles, $20,000 credit to Owner's Equity
B. $10,000 debit to Vehicles, $10,000 credit to Notes Payable
C. $20,000 debit to Vehicles, $20,000 credit to Notes Payable
D. $20,000 debit to Vehicles, $20,000 credit to Accounts Payable
19. A double-entry system of bookkeeping is one in which
A. two separate sets of record books are kept.
B. each transaction consists of just one credit and just one debit.
C. two different people make the entries in the journal as a check on correctness.
D. the credit portion of a transaction must always equal the debit portion.
20. Which of the following taxes must be paid only by the employer?
A. Federal income
C. Federal unemployment
You forgot to post your answers.
I was just over looking them
Theres alot i wasn't sure about so if oyu could please help that be great thank youposted by Tina
I urge you to go back and really study your course materials.
I believe you're right for 2, 3, 4, 9, 10, 11.
It looks as though the following are wrong: 2, 5, 6, 7, 8, 12, 13, 19, 20
I don't know about 3, 14, 15, 16, 17, 18
answer 13 is not d
the answer is (b)
actually i just took it and got a 60. 14 c 15 b and colleen is right will post the correct answers as i get them but 1, 5, 8, 12, 16, 17, 19, 20 are wrong. i have to wait until tommorow to retake.
the correct answers are 1 b, 2 c, 3a, 4c, 5b, 6c, 7d, 8d, 9b, 10c, 11c, 12d, 13b, 14c, 15b, 16c, 17a, 18d, 19d, 20c
thanks meghan that really helped do u have a email to where i can email if i need help.posted by Heather
I don't understand what Profit Margin is. How is the answer to 13 B? When the information provided, that the answer should be D.posted by christine