Accounting Functions = ~32% of the exam. The high-yield topics: payroll taxes, job costing, financial ratios, markup vs margin, and cash flow. Most answers live in the Builder's Guide to Accounting and IRS Circular E.
Payroll taxes (know the rates cold)
- FICA: Social Security 6.2% employer + 6.2% employee (up to the wage base); Medicare 1.45% each, no wage cap.
- FUTA: 6.0% on the first $7,000 of wages, usually netting 0.6% after the 5.4% state credit.
- Florida has no state income tax; reemployment (SUTA) tax is employer-paid.
- Forms: 941 (quarterly), W-2 (annual wages), 1099-NEC ($600+ to non-employees), W-4 (withholding), I-9 (work eligibility).
Job costing
Separate direct (job) costs — labor, materials, equipment for a specific project — from overhead (office rent, admin salaries, general insurance). Track actual costs against the estimate to protect profit. Percentage-of-completion is commonly measured cost-to-cost: costs to date ÷ total estimated costs.
Financial ratios
- Current ratio = current assets ÷ current liabilities.
- Quick (acid-test) ratio = (current assets − inventory) ÷ current liabilities.
- Working capital = current assets − current liabilities.
- Net profit margin = net profit ÷ revenue.
Markup vs margin (a classic trap)
They're not the same. Markup = profit ÷ cost; margin = profit ÷ price. A job costing $80,000 sold for $100,000 is a 25% markup but a 20% margin. Mixing these up is a common wrong answer.
Cash flow & accounting methods
A profitable company can still fail if cash comes in slower than it goes out — cash-flow timing matters. Know accrual (recognize revenue when earned/expenses when incurred) vs cash (when money actually moves), and retainage (commonly 10% withheld until completion).
Every item above maps to a spot in your open-book references. Drilling where each lives is what the Open-Book Finder trains — and it's why fast candidates finish the accounting questions quickly.
Practice the accounting questions
Work the 32% that decides the most outcomes, each question explained. First 5 free — no account needed.