Financial User Exam part 3

What is the role of vendor payments in relation to vendor bills? Choose the best answer.

 

A.    To reduce the amount of vendor bills 

B.    To record a refund from a vendor

C.    To initiate payments for vendor bills that are due

D.    To adjust vendor bill amounts for discrepancies.

C. To initiate payments for vendor bills that are due

What is the primary purpose of an Accounts Payable (A/P) Aging Report? Select all that apply.

A.    To track overdue customer payments.

B.   To manage vendor payments.

C.    To identify outstanding vendor invoices and due dates.

D.    To monitor employee expenses.

B.  To manage vendor payments.

C.  To identify outstanding vendor invoices and due dates.

You can only create vendor bills from existing purchase orders or item receipts, not as standalone entries.

 

A.    True

B.   False

B.   False

Which statements about subsidiaries are true? Select all that apply.

A.      You can associate Vendor records with secondary subsidiaries to allow more than one subsidiary to transact with the vendor.

B.     Employees can access data from more than one subsidiary, depending on their user role.

C.      Accounts are always available for use in all subsidiaries.

D.     In reports, use the Subsidiary Context filter to view data for a selected subsidiary.

A.     You can associate Vendor records with secondary subsidiaries to allow more than one subsidiary to transact with the vendor.

B.     Employees can access data from more than one subsidiary, depending on their user role.

D.     In reports, use the Subsidiary Context filter to view data for a selected subsidiary.

Create intercompany allocation schedules when you have reoccurring costs that are shared between multiple subsidiaries.

A.     True

B.     False

A. True

On an Advanced Intercompany Journal form, clicking Auto Balance balances the debit and credit lines per subsidiary. 

A.     True

B.     False

True✅

On an Advanced Intercompany Journal form, all journal entries are posted to the Elimination subsidiary at period close.

A.     True

B.     False

B.  False

Which of the following is NOT a classification used in NetSuite?

A. Department
B. Category
C. Class
D. Location

B. Category

In NetSuite OneWorld, each subsidiary can have its own functional currency

A. True
B. False

A. True

What is the primary purpose of the Chart of Accounts in NetSuite?

A. To assign prices to items
B. To manage subsidiaries
C. To define financial reporting structure
D. To link vendors to payments

C. To define financial reporting structure

What happens if you change the account type of a GL account in NetSuite?

A. All historical data is deleted
B. The system prevents the change
C. It can affect financial reporting and transactions
D. Nothing changes

C. It can affect financial reporting and transactions

You can restrict user access to specific accounts on the Chart of Accounts

A. True
B. False

A. True

Which of the following allows segmentation of transactions for reporting?

A. Subsidiaries
B. Revenue recognition rules
C. Departments, Classes, Locations
D. Saved searches

C. Departments, Classes, Locations

Which account type allows bank reconciliations in NetSuite?

A. Expense
B. Fixed Asset
C. Bank
D. Credit Card

C. Bank

How many levels of classification can be applied to a transaction?
A. One
B. Two
C. Three
D. Unlimited

C. Three

What is the correct order of the AR transaction flow in NetSuite?

A. Invoice -> Sales Order -> Payment
B. Sales Order -> Invoice -> Payment
C. Estimate -> Payment -> Invoice
D. Invoice -> Payment -> Sales Order

B. Sales Order -> Invoice -> Payment

Customer deposits in NetSuite automatically apply to open invoices.

A. True
B. False

B. False

Which field is required when creating a customer record?

A. Primary currency
B. Subsidiary
C. Tax code
D. Sales rep

B. Subsidiary

What GL account is typically impacted when accepting a customer payment?

A. Accounts Payable
B. Revenue
C. Accounts Receivable
D. Expense

C. Accounts Receivable

What is the main difference between a customer deposit and a payment?

A. One is taxable
B. Deposit is a prepayment; payment applies to invoices
C. They use different currencies
D. Deposits are only for vendors.

B. Deposit is a prepayment; payment applies to invoices

An invoice in NetSuite must always originate from a sales order

A. True
B. False

B. False

When accepting a customer payment, which transaction type can it be applied against?
A. Purchase Order
B. Vendor Bill
C. Invoice
D. Journal Entry

C. Invoice

Billing schedules automate recurring billing in NetSuite

A. True

B. False

A. True

Which transaction is a billing schedule most commonly associated with?

A. Vendor bill
B. Journal entry
C. Sales order
D. Bank deposit

C. Sales order

What must be done before a billing schedule will generate invoices?

A. Enable forecasting
B. Close the accounting period
C. Approve the sales order
D. Apply it to a customer record

C. Approve the sales order

What is the correct AP transaction flow in NetSuite?

A. Item Receipt -> Purchase Order -> Vendor Bill -> Payment
B. Purchase Order -> Vendor Bill -> Payment
C. Vendor Bill -> Purchase Order -> Payment
D. Purchase Order -> Item Receipt -> Vendor Bill -> Payment

D. Purchase Order -> Item Receipt -> Vendor Bill -> Payment

Vendor records must include a default expense account.

A. True
B. False

B. False

Which payment method is not native to NetSuite?

A. ACH
B. Wire Transfer
C. Cryptocurrency
D. Check

C. Cryptocurrency

What GL account is typically credited when you enter a vendor bill?

A. Accounts Receivable
B. Expense
C. Bank
D. Accounts Payable

D. Accounts Payable

You must receive items before creating a vendor bill for them.

A. True
B. False

B. False

Which of the following fields is required when creating a vendor?

A. Currency
B. Location
C. Subsidiary
D. Payment terms

C. Subsidiary

What type of account is needed for bank reconciliations in NetSuite?

A. Other Expense
B. Bank
C. Asset
D. Revenue

B. Bank

NetSuite allows automatic bank feed imports for some institutions.

A. True
B. False

A. True

What is the purpose of the 'Reconcile Account Statement' page in NetSuite?

A. Import vendor payments
B. Clear checks and deposits against bank statements
C. Enter journal entries
D. Pay employees

B. Clear checks and deposits against bank statements

Which transaction is used to move funds between bank accounts?

A. Bank Transfer
B. Journal Entry
C. Vendor Payment
D. Deposit

A. Bank Transfer

What is the key difference between an intercompany journal and a regular journal?

A. Intercompany journals use taxes
B. Regular journals do not require approval
C. Intercompany journals involve multiple subsidiaries
D. Regular journals are only used for expenses.

C. Intercompany journals involve multiple subsidiaries

NetSuite requires journals to be approved before posting.

A. True
B. False

B. False

Which of the following is a valid use for journal entries in NetSuite?

A. Processing vendor payments
B. Importing transactions
C. Recording depreciation
D. Creating customer invoices.

C. Recording depreciation

Where do you create a budget in NetSuite?

A. Chart of Accounts
B. Transactions > Financial > Set up Budgets
C. Reports > Financial > Set up Budget
D. Setup > Accounting > Set up Budgets

B. Transactions > Financial > Set up Budgets

Budgets can be created for specific departments and subsidiaries.

A. True
B. False

A. True

Which best describes a dynamic allocation in NetSuite?

A. Allocates based on fixed percentages
B. Allocates based on prior period GL balances
C. Allocates based on user input
D. Requires a saved search.

B. Allocates based on prior period GL balances

Fixed allocations allow only one target department.

A. True
B. False

B. False

Expense allocations in NetSuite result in which type of transaction?

A. Invoice
B. Journal Entry
C. Vendor Bill
D. Customer Payment

B. Journal Entry

Which tool allows customization of financial reports in NetSuite?

A. Saved Search Builder
B. Financial Report Builder
C. KPI Manager
D. Suite Flow

B. Financial Report Builder

Only income and expense accounts appear on the Balance Sheet.

A. True
B. False

B. False

What is the first step in the NetSuite period close checklist?

A. Lock AR
B. Review transactions
C. Lock AP
D. Close the period

B. Review transactions

You can define separate fiscal calendars for each subsidiary in NetSuite OneWorld.

A. True
B. False

A. True

What is the main purpose of classifications (Department, Class, Location) in NetSuite?

A) To restrict user access
B) To track and report on transactions
C) To create new subsidiaries
D) To manage user roles

B) To track and report on transactions

What happens if you change an account’s type in the chart of accounts?

A) The account is deleted
B) The account’s reporting and transaction behavior may change
C) The account is merged with another
D) Nothing changes

B) The account’s reporting and transaction behavior may change

Which classification would you use to track expenses by business unit?

A) Department
B) Class
C) Location
D) Subsidiary

A) Department

True or False: Each subsidiary must have its own chart of accounts in NetSuite OneWorld.

A) True
B) False

B) False

What is the impact of making a classification field mandatory on transactions?

A) Transactions can be saved without the field
B) Transactions must include the classification
C) The field is hidden
D) The field is only required for reports

B) Transactions must include the classification

Which of the following can be restricted by user role in NetSuite?

A) Chart of accounts access
B) Subsidiary access
C) Both A and B
D) Neither A nor B

C) Both A and B

Which field on a customer record determines how long they have to pay an invoice?

A) Credit Limit
B) Terms
C) Status
D) Category

B) Terms

Which transaction increases Accounts Receivable in NetSuite?

A) Vendor Bill
B) Customer Payment
C) Customer Invoice
D) Journal Entry

C) Customer Invoice

What is the GL impact of creating a customer invoice?

A) Debit Accounts Payable, Credit Revenue
B) Debit Accounts Receivable, Credit Revenue
C) Debit Revenue, Credit Accounts Receivable
D) Debit Cash, Credit Revenue

B) Debit Accounts Receivable, Credit Revenue

What is the purpose of a customer deposit in NetSuite?

A) To record a payment before an invoice is issued
B) To pay a vendor
C) To allocate expenses
D) To close a period

A) To record a payment before an invoice is issued

Which of the following is NOT required to create a customer invoice?

A) Customer
B) Item
C) Vendor
D) Subsidiary

C) Vendor

How do you record a partial payment from a customer in NetSuite?

A) Enter a full payment and issue a refund
B) Enter a customer payment for the partial amount
C) Create a credit memo
D) Write off the balance

B) Enter a customer payment for the partial amount

Customer deposits automatically apply to open invoices.

A) True
B) False

B) False

What is a billing schedule used for in NetSuite?

A) To schedule vendor payments
B) To automate recurring billing for sales orders
C) To allocate expenses
D) To reconcile bank accounts

B) To automate recurring billing for sales orders

What is the effect on the General Ledger when a customer deposit is received and applied across multiple subsidiaries?

A) Only the receiving subsidiary’s cash account is impacted
B) Intercompany accounts are adjusted to balance the deposit across subsidiaries
C) Deposits do not affect the General Ledger until invoices are created
D) No GL impact until payment is finalized

B) Intercompany accounts are adjusted to balance the deposit across subsidiaries

Which type of billing schedule would you use for a project with milestone payments?

A) Standard
B) Milestone
C) Installment
D) Fixed

B) Milestone

How do intercompany journal entries differ from elimination journal entries in NetSuite?

A) Intercompany entries record operational transactions between subsidiaries; elimination entries remove intercompany effects for consolidated reporting

B) Intercompany entries are only for vendors; elimination entries are for customers

C) Both are the same and used interchangeably

D) Elimination entries are posted in subsidiary records; intercompany entries are not

A) Intercompany entries record operational transactions between subsidiaries; elimination entries remove intercompany effects for consolidated reporting

Billing schedules can only be applied to sales orders.

A) True
B) False

B) False

What is the GL impact of entering a vendor bill?

A) Debit Accounts Payable, Credit Expense
B) Debit Expense, Credit Accounts Payable
C) Debit Revenue, Credit Accounts Payable
D) Debit Accounts Payable, Credit Revenue

B) Debit Expense, Credit Accounts Payable

What is the purpose of a bank account record in NetSuite?

A) To track cash balances and transactions
B) To manage vendors
C) To create classifications
D) To allocate expenses

A) To track cash balances and transactions

What challenge arises from using multiple fiscal calendars in NetSuite OneWorld during period close?

A) Periods close automatically without user input
B) Consolidated reports can have inconsistent period data if subsidiaries close at different times
C) Only one fiscal calendar can be active at a time
D) Intercompany journal entries are not supported

B) Consolidated reports can have inconsistent period data if subsidiaries close at different times

Which step is NOT part of the bank reconciliation process in NetSuite?

A) Match transactions
B) Enter adjusting entries
C) Approve vendor bills
D) Mark transactions as cleared

C) Approve vendor bills

What is the purpose of using billing schedules in NetSuite?

A) To automate the creation of invoices over time based on a contract or agreement
B) To record journal entries for expense allocations
C) To manage vendor payments
D) To allocate budgets across departments

A) To automate the creation of invoices over time based on a contract or agreement

When would you use a journal entry instead of a standard transaction?

A) To record a customer invoice
B) To record a vendor bill
C) To make an adjusting entry
D) To create a sales order

C) To make an adjusting entry

How can you report on budget vs. actuals in NetSuite?

A) Use the Budget vs. Actual report
B) Use the Bank Reconciliation report
C) Use the Customer Statement
D) Use the Inventory Valuation report

A) Use the Budget vs. Actual report

How does posting a vendor bill affect the financial reports in NetSuite?

A) Increases revenue
B) Increases expenses and accounts payable
C) Decreases cash
D) Increases inventory

B) Increases expenses and accounts payable

What happens if an intercompany transaction is not balanced?

A) It posts with a warning but no impact
B) It prevents posting and blocks period close until corrected
C) It is ignored during consolidation
D) It automatically adjusts balances.

B) It prevents posting and blocks period close until corrected

What is a limitation of NetSuite budgeting related to multi-segment organizations?

A) Budgets cannot be segmented by class or location simultaneously
B) Budgets automatically include all subsidiaries regardless of structure
C) Budgets update dynamically with transactions
D) There is no limit to segmenting budgets

A) Budgets cannot be segmented by class or location simultaneously

Which journal entry type is best suited for allocating expenses across departments within a single subsidiary?

A) Standard journal entry
B) Intercompany journal entry
C) Elimination journal entry
D) Expense allocation journal entry­

D) Expense allocation journal entry­