100+ Free ABA Practice Questions

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Question 1

Score: 0/0

Under the IRS common-law right-of-control test for worker classification, which factor most strongly indicates EMPLOYEE status (vs. independent contractor)?

The worker can realize a profit or loss

The worker is paid by the project rather than by the hour

The worker uses their own tools and equipment

The business directs when, where, and how the work is performed

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2026 Statistics

Key Facts: ABA Exam

200

Total Questions (100 per Practice)

ACAT Candidate Handbook

3 hours

Time Per Practice

ACAT Candidate Handbook

$400

Full Exam Fee (both Practices)

ACAT 2026 fee schedule

Passing Score Per Practice

ACAT scoring policy (75 in MN)

3 years

Experience Required (up to 2 via college credit)

ACAT eligibility rules

2x/year

2026 Testing Windows (Summer + Fall)

ACAT exam calendar

120 hrs

CPE Required Every 3 Years

ACAT renewal requirements

ACAT's ABA is a 200-question, two-part exam (Practice 1 and Practice 2, 100 questions each, 3 hours each) offered in Summer (June 1-July 15) and Fall (September 15-November 15) windows at Scantron centers. The 2026 fee is $400 for both parts ($250 per single part), plus a $50 credential activation fee. A passing score of 70 is required on each Practice (75 in Minnesota). Candidates also need 3 years of related work experience (up to 2 satisfied through college accounting credit) and must complete 120 CPE hours every 3 years to maintain the credential.

Sample ABA Practice Questions

Try these sample questions to test your ABA exam readiness. Each question includes a detailed explanation. Start the interactive quiz above for the full 100+ question experience with AI tutoring.

1The ABA Comprehensive Examination is divided into two parts. Which subject is tested on Practice 1?

A.Financial accounting and financial statement preparation, presentation, and reporting

B.Taxation of corporations and partnerships

C.Business law and the Uniform Commercial Code

D.Ethics and professional conduct

Explanation: Per the ACAT Candidate Handbook, Practice 1 (100 questions, 3 hours) covers financial accounting and financial statement preparation, presentation, and reporting. Practice 2 covers business consulting services, taxation, business law, and ethics.

2Under the accrual basis of accounting, when should revenue from a service performed in December 2026 but billed and collected in January 2027 be recognized?

A.December 2026, when the service was performed

B.January 2027, when the invoice was issued

C.January 2027, when cash was collected

D.Split evenly between December 2026 and January 2027

Explanation: Accrual accounting (and ASC 606) recognizes revenue when the performance obligation is satisfied, not when cash is received. Performing the service in December creates the right to consideration, so revenue belongs in December 2026 with a corresponding accounts receivable.

3ASC 606 prescribes a five-step model for revenue recognition. Which of the following is the FIRST step?

A.Identify the contract with a customer

B.Identify the performance obligations in the contract

C.Determine the transaction price

D.Recognize revenue when performance obligations are satisfied

Explanation: ASC 606's five-step model is: (1) identify the contract, (2) identify performance obligations, (3) determine the transaction price, (4) allocate the transaction price to performance obligations, (5) recognize revenue when (or as) the entity satisfies each performance obligation.

4Under U.S. GAAP, which inventory costing method is NOT permitted for financial reporting?

A.Next-in, first-out (NIFO)

B.First-in, first-out (FIFO)

C.Last-in, first-out (LIFO)

D.Weighted-average cost

Explanation: NIFO is not a GAAP-permitted method. GAAP permits FIFO, LIFO, weighted average, and specific identification. (Note: IFRS prohibits LIFO, but GAAP allows it.)

5Under ASC 842 (Leases), how should a lessee account for a 5-year non-cancelable equipment lease?

A.Recognize a right-of-use asset and a lease liability on the balance sheet

B.Treat lease payments as expense only, with no balance sheet recognition

C.Recognize only a lease liability without a right-of-use asset

D.Recognize the asset and depreciate it over its physical life

Explanation: Under ASC 842, lessees recognize a right-of-use (ROU) asset and a corresponding lease liability for nearly all leases longer than 12 months, regardless of whether the lease is finance or operating. This brought operating leases onto the balance sheet, a major change from prior ASC 840.

6For GAAP financial statements, how must a company account for uncollectible trade accounts receivable?

A.Use the allowance method to estimate expected credit losses

B.Use the direct write-off method as receivables become uncollectible

C.Either the allowance or direct write-off method may be used

D.Record a contra-asset only when a customer files bankruptcy

Explanation: GAAP requires the allowance method because it matches bad debt expense to the period in which the related revenue was recognized. The direct write-off method is permitted for federal income tax purposes (for most taxpayers) but not for GAAP financial reporting.

7A small business buys office furniture for $8,000 in 2026 (7-year MACRS property, half-year convention, no bonus or Section 179). Which depreciation method applies for federal income tax?

A.200% declining balance switching to straight-line (GDS)

B.Straight-line over 39 years

C.Straight-line over 5 years

D.Sum-of-the-years'-digits over 7 years

Explanation: Office furniture is 7-year MACRS property under the General Depreciation System (GDS), depreciated using the 200% declining-balance method with a switch to straight-line when straight-line yields a larger deduction. The half-year convention applies in the first and last year.

8Beginning inventory is $10,000, purchases are $40,000, and ending inventory is $12,000. Under the periodic system, what is cost of goods sold?

A.$38,000

B.$42,000

C.$50,000

D.$62,000

Explanation: COGS = Beginning Inventory + Purchases - Ending Inventory = $10,000 + $40,000 - $12,000 = $38,000.

9On a multi-step income statement, which subtotal appears IMMEDIATELY after gross profit?

A.Operating income (or income from operations)

B.Net income

C.Income before taxes

D.Earnings per share

Explanation: A multi-step income statement flows: Sales - COGS = Gross Profit - Operating Expenses (selling, G&A) = Operating Income, then non-operating items yield Income Before Taxes, then Income Tax Expense yields Net Income.

10A classified balance sheet generally lists assets in what order?

A.Order of liquidity, current assets first

B.Alphabetical order

C.Order of acquisition date

D.Order of dollar magnitude, largest first

Explanation: U.S. GAAP classifies the balance sheet by liquidity: current assets first (cash, A/R, inventory, prepaids), then non-current (PP&E, intangibles, investments). The same liquidity ordering applies to liabilities (current then long-term).

About the ABA Exam

The ABA Comprehensive Examination for Accreditation in Accountancy is a two-part, 200-question computer-based test administered at Scantron testing centers across the U.S. Practice 1 (100 questions, 3 hours) covers financial accounting and financial statement preparation, presentation, and reporting. Practice 2 (100 questions, 3 hours) covers taxation (56 questions), business law (18), business consulting services (17), and ethics (9). ABA holders are recognized in several states (including Iowa and Minnesota) as legal substitutes for CPAs for non-attest services such as bookkeeping, tax preparation, and compilation engagements.

Questions

200 scored questions

Time Limit

3 hours per Practice (6 hours total)

Passing Score

Exam Fee

$400 (both Practices) / $250 (one Practice) (Accreditation Council for Accountancy and Taxation (ACAT))

ABA Exam Content Outline

50%

Practice 1: Financial Accounting & Financial Statement Preparation

Accounting principles and pronouncements, record setup, accounting cycle, cash vs accrual, revenue recognition (ASC 606), adjusting/reversing/closing entries and error correction, worksheet preparation, financial statement presentation (balance sheet, income statement, statement of cash flows, supplemental disclosures), cash and equivalents, receivables, investments, inventories, PP&E and depreciation/depletion/amortization, intangibles, current and long-term liabilities, stockholders' equity, payroll, leases (ASC 842), pensions, engagement letters, OCBOA, statement of changes in equity, working capital changes, ratio and cash flow analysis.

28%

Practice 2: Taxation (56 questions)

Filing considerations, accounting methods (cash/accrual/hybrid, §448, Form 3115), inclusion/exclusion from income, adjustments to income, itemized deductions, sole proprietorship, self-employment, rental activity, investments and planning, income tax credits, special computations, partnerships, corporations (C and S), fiduciaries, estates, LLEs, self-employment issues, divorce, independent contractor/employee classification, and non-profit returns.

Practice 2: Business Law (18 questions)

Property law, contracts (common law and Restatement), Uniform Commercial Code (Articles 2, 3, 9), agency, partnerships (UPA/RUPA), limited liability entities (LLCs, LLPs), corporations, and trusts.

8.5%

Practice 2: Business Consulting Services (17 questions)

Cost-volume-profit analysis, department analysis, time value of money, capital budgeting (payback, NPV, IRR), capital investment analysis, budgets (static, flexible, cash), managerial decisions, cash flow planning, internal controls evaluation, investment and business opportunity evaluation, and employee benefit plan design.

4.5%

Practice 2: Ethics & Professional Conduct (9 questions)

ACAT Code of Ethics and Rules of Professional Conduct, AICPA Code of Professional Conduct (integrity, objectivity, independence, due care), IRS Circular 230 (due diligence, contingent fees, written advice), SSTS standards for tax positions (reasonable basis, substantial authority, MLTN), and practice procedures.

How to Pass the ABA Exam

What You Need to Know

Passing score: 70
Exam length: 200 questions
Time limit: 3 hours per Practice (6 hours total)
Exam fee: $400 (both Practices) / $250 (one Practice)

Keys to Passing

Complete 500+ practice questions
Score 80%+ consistently before scheduling
Focus on highest-weighted sections
Use our AI tutor for tough concepts

ABA Study Tips from Top Performers

1Practice 1 is half the exam — invest heavily in GAAP fundamentals: accrual accounting, revenue recognition (ASC 606 five-step), inventory (FIFO/LIFO/WAvg/LCNRV), depreciation (MACRS for tax vs straight-line/DDB for GAAP), leases (ASC 842 ROU asset), and the full statement of cash flows reconciliation

2For Practice 2 taxation (56 questions), drill business entity returns (1040 Sch C, 1065/K-1, 1120-S/K-1, 1120), payroll taxes (FICA, FUTA, SECA, 941, 940, W-2/1099 deadlines), §199A QBI, §179 expensing, accounting methods (§448 cash method threshold, Form 3115), and accountable plan rules

3Memorize the UCC §2-201 Statute of Frauds threshold ($500 for goods), the four elements of a contract, agency authority types, and entity formation defaults (LLC default tax treatment under check-the-box regs)

4For business consulting, drill the core formulas: break-even = FC/CM per unit, target units = (FC + Target OI)/CM, NPV, payback, EOQ, and the time value of money tables — these are heavily tested and quickly answered

5Read ACAT's Code of Ethics, AICPA Code, and Circular 230 before exam day — ethics is only 9 questions but easy points if you know the principles (integrity, objectivity, independence, due care), contingent fee rules, and tax position thresholds (reasonable basis 20%, substantial authority 40%, MLTN >50%)

Frequently Asked Questions

What is the format of the ACAT ABA exam?

The ABA Comprehensive Examination for Accreditation in Accountancy is a two-part, 200-question computer-based test administered at Scantron Testing Centers. Each Practice (Part) is 100 multiple-choice questions answered in 3 hours. Practice 1 covers financial accounting; Practice 2 covers taxation (56), business law (18), business consulting (17), and ethics (9). The exam is offered twice a year in Summer (June 1-July 15) and Fall (September 15-November 15) windows.

How much does the ACAT ABA exam cost in 2026?

The full ABA exam fee (Practice 1 and Practice 2) is $400; a single Practice is $250. After passing, a $50 credential activation fee and $20 certificate fee apply. Annual ACAT renewal fees also apply to maintain the credential — exam fees do not include these. There is a $50 late fee for registering after the published deadline.

What passing score do I need on the ABA exam?

A score of 70 is required to pass each Practice. Minnesota requires 75 on both Practices for the credential to meet state regulatory requirements. Candidates who pass one Practice but not the other have 18 months to retake the failed Practice; failing to pass both within that window requires reapplying and retaking both Practices.

What experience do I need to earn the ABA credential?

Candidates must be at least 18 and have three years of related work experience, up to two of which may be satisfied through two years of college-level accounting credit. There is no formal educational requirement to sit for the exam, but ACAT recommends Principles, Intermediate, Cost or Managerial, and at least one semester of Taxation before testing. Candidates who pass without meeting the experience requirement may say they 'passed the ACAT Comprehensive Examination' but cannot use the ABA designation.

How long should I study for the ABA exam?

Most candidates plan 150-300 hours of dedicated study over 12-20 weeks. Practice 1 (financial accounting) usually requires more time for candidates without recent GAAP exposure. Practice 2's 56-question taxation section requires solid familiarity with individual and business entity returns, IRC accounting methods, §199A, depreciation (MACRS, §179), and payroll tax.

Where is the ABA exam administered and how do I register?

The ABA exam is administered at Scantron Testing Centers across North America. Register at acatcredentials.org by the published deadline (May 29 for the Summer window, September 12 for the Fall window). Once registered, ACAT issues a Notice to Schedule/Eligibility Notice, and you book an appointment with Scantron up to 45 days before the testing window. You may reschedule up to 4 business days before the appointment for a $50 fee.

Does the ABA credential let me practice as a CPA?

No — the ABA is a separate credential from the CPA license and does not authorize attest services (audits) in any state. However, ABA holders ARE recognized in Iowa and Minnesota as meeting state regulatory requirements for practicing public accountancy (non-attest services). In other states, the term 'accountant' for non-CPAs varies; ABA holders may use 'Accredited Business Advisor' as an alternative title where state rules restrict 'accountant.' Always check state board rules.