UTA Accounting Entrance Exam with
correct answers
Jones Dairy purchased a new milking machine for $40,000 cash. To record the transaction on Jones'
books, you would: - Correct Answers debit an asset account and credit an asset account.
Rent Expense typically would have: - Correct Answers a debit balance.
If the beginning balance in the Machinery account is $35,000, and if the ending balance in the
Machinery account is $57,000, then: - Correct Answers purchases and sales of machinery cannot be
determined from the information given.
A double-entry system of accounting requires that each transaction or event be recorded: - Correct
Answers in at least two different accounts.
The trial balance should be prepared: - Correct Answers Before financial statements are prepared.
At the end of an accounting period when accounts are ready to be closed, which of the following
activities must be performed? - Correct Answers Make closing entries and prepare post closing trial
balance
The Prepaid Insurance account has an account balance of $3,000. At the end of an accounting period,
the controller has decided that $2,000 of the balance has expired. Which of the following adjusting
entries should be made? - Correct Answers D: Insurance Expense 2,000
C : Prepaid Insurance 2,000
Gross profit is calculated by: - Correct Answers subtracting cost of goods sold from net sales.
The operating expense section of an income statement for a wholesaler would not include: - Correct
Answers cost of goods sold.
, Cramer Corp. reported the following for 2004: total assets, $90,000; total liabilities, $35,000;
contributed capital (i.e., total paid in capital), $40,000. Therefore, retained earnings was: - Correct
Answers $15,000
Which of the following would not be considered a current asset? - Correct Answers All of the above are
current assets.
Which of the following would appropriately be included in the Cash account on a balance sheet? -
Correct Answers Unrestricted foreign currency
In preparing a typical bank reconciliation, how would outstanding checks be handled? - Correct Answers
Subtracted from "balance per bank."
During 2004, ABC Company had $750,000 of net credit sales. Accounts Receivable had a December 31,
2004, balance of $250,000. No amounts have been added to the Allowance for Doubtful Accounts
during 2004. Before adjustment on December 31, 2004, the Allowance for Doubtful Accounts had a
credit balance of $2,000. ABC estimates that 3% of net credit sales will become uncollectible. What will
be the adjusted balance in Allowance for Doubtful Accounts at December 31? - Correct Answers
$24,500
During 2004, Allied Associates had $750,000 of net credit sales. Accounts Receivable had a December
31, 2004, balance of $250,000. No amounts have been added to the Allowance for Doubtful Accounts
during 2004. Before adjustment on December 31, 2004, the Allowance for Doubtful Accounts had a
credit balance of $2,000. Allied estimates that 6% of receivables will become uncollectible. What will be
the adjusted balance in Allowance for Doubtful Accounts at December 31? - Correct Answers $15,000
Assume that Jones Company purchased $100 of inventory on credit. If Jones Company uses the Periodic
Inventory system the journal entry to record this purchase would be: - Correct Answers D : Purchases
100
C: Accounts Payable 100
Adams Inc. started the year with merchandise inventory of $20 (4 widgets @ $5 each). During the year
the following activity occurred:
Date Purchases Sales
correct answers
Jones Dairy purchased a new milking machine for $40,000 cash. To record the transaction on Jones'
books, you would: - Correct Answers debit an asset account and credit an asset account.
Rent Expense typically would have: - Correct Answers a debit balance.
If the beginning balance in the Machinery account is $35,000, and if the ending balance in the
Machinery account is $57,000, then: - Correct Answers purchases and sales of machinery cannot be
determined from the information given.
A double-entry system of accounting requires that each transaction or event be recorded: - Correct
Answers in at least two different accounts.
The trial balance should be prepared: - Correct Answers Before financial statements are prepared.
At the end of an accounting period when accounts are ready to be closed, which of the following
activities must be performed? - Correct Answers Make closing entries and prepare post closing trial
balance
The Prepaid Insurance account has an account balance of $3,000. At the end of an accounting period,
the controller has decided that $2,000 of the balance has expired. Which of the following adjusting
entries should be made? - Correct Answers D: Insurance Expense 2,000
C : Prepaid Insurance 2,000
Gross profit is calculated by: - Correct Answers subtracting cost of goods sold from net sales.
The operating expense section of an income statement for a wholesaler would not include: - Correct
Answers cost of goods sold.
, Cramer Corp. reported the following for 2004: total assets, $90,000; total liabilities, $35,000;
contributed capital (i.e., total paid in capital), $40,000. Therefore, retained earnings was: - Correct
Answers $15,000
Which of the following would not be considered a current asset? - Correct Answers All of the above are
current assets.
Which of the following would appropriately be included in the Cash account on a balance sheet? -
Correct Answers Unrestricted foreign currency
In preparing a typical bank reconciliation, how would outstanding checks be handled? - Correct Answers
Subtracted from "balance per bank."
During 2004, ABC Company had $750,000 of net credit sales. Accounts Receivable had a December 31,
2004, balance of $250,000. No amounts have been added to the Allowance for Doubtful Accounts
during 2004. Before adjustment on December 31, 2004, the Allowance for Doubtful Accounts had a
credit balance of $2,000. ABC estimates that 3% of net credit sales will become uncollectible. What will
be the adjusted balance in Allowance for Doubtful Accounts at December 31? - Correct Answers
$24,500
During 2004, Allied Associates had $750,000 of net credit sales. Accounts Receivable had a December
31, 2004, balance of $250,000. No amounts have been added to the Allowance for Doubtful Accounts
during 2004. Before adjustment on December 31, 2004, the Allowance for Doubtful Accounts had a
credit balance of $2,000. Allied estimates that 6% of receivables will become uncollectible. What will be
the adjusted balance in Allowance for Doubtful Accounts at December 31? - Correct Answers $15,000
Assume that Jones Company purchased $100 of inventory on credit. If Jones Company uses the Periodic
Inventory system the journal entry to record this purchase would be: - Correct Answers D : Purchases
100
C: Accounts Payable 100
Adams Inc. started the year with merchandise inventory of $20 (4 widgets @ $5 each). During the year
the following activity occurred:
Date Purchases Sales
