BUSA 1102 Unit 4-6 2025/2026 Basic
Accounting Exam Questions with Correct
Answers Actual Exam (Score A) University of
People
Which method is the allowance method approach that estimates bad debt expenses
based on the assumption that at the end of the period, a certain percentage of sales
during the period will not be collected?
Select one:
a.Income statement method
b.Direct write-off method
c.Completed contract method
a.Income statement method
What is the uncollectible amounts from customer accounts?
Select one:
a.Bad debts
b.Accounts receivable
c.Revenue
a.Bad debts
,Yellow Inc. reports year-end credit sales in the amount of $209,000 and accounts
receivable of $163,000. The company uses the balance sheet method to report bad debt
estimation. The estimation percentage is 2.9%. What is the estimated balance
uncollectible using the balance sheet method?
Select one:
a.$4,727
b.$6,061
c.$372,000
a.$4,727
Which account is paired with another account type that has an opposite normal
balance to the paired account; reduces or increases the balance in the paired account
at the end of a period?
Select one:
a.Accounts receivable
b.Contra account
c.Principal
b.Contra account
The gross profit method is used to estimate inventory values by applying a standard
gross profit percentage to the company's sales totals when a physical count is not
possible.
Select one:
a.True
,b.False
a.True
The direct write-off method delays recognition of bad debt until the specific customer
accounts receivable is identified.
Select one:
a.True
b.False
a.True
The VWX Company collects an honored note with a maturity date of 36 months from
establishment, a 8% interest rate, and an initial loan amount of $40,000. Which
accounts are used to record collection of the honored note at maturity date?
Select one:
a.Interest Revenue, Interest Expense, Cash
b.Interest Receivable, Cash, Notes Receivable
c.Interest Revenue, Interest Receivable, Cash, Notes Receivable
c.Interest Revenue, Interest Receivable, Cash, Notes Receivable
Which inventory costing method is almost always done on a perpetual basis?
Select one:
, a.First-in, First-out
b.Last-in, First-out
c.Specific identification
c.Specific identification
The PQR Company has a balance of $25,000 in accounts receivable and a $5,000
balance in the allowance for doubtful accounts. What is the net realizable value?
Select one:
a.$5,000
b.$20,000
c.$30,000
b.$20,000
When would a company use the specific identification method of inventory cost
allocation?
Select one:
a.Petty cash fund
b.Expensive items that are highly customized
c.Consigned goods
b.Expensive items that are highly customized
Accounting Exam Questions with Correct
Answers Actual Exam (Score A) University of
People
Which method is the allowance method approach that estimates bad debt expenses
based on the assumption that at the end of the period, a certain percentage of sales
during the period will not be collected?
Select one:
a.Income statement method
b.Direct write-off method
c.Completed contract method
a.Income statement method
What is the uncollectible amounts from customer accounts?
Select one:
a.Bad debts
b.Accounts receivable
c.Revenue
a.Bad debts
,Yellow Inc. reports year-end credit sales in the amount of $209,000 and accounts
receivable of $163,000. The company uses the balance sheet method to report bad debt
estimation. The estimation percentage is 2.9%. What is the estimated balance
uncollectible using the balance sheet method?
Select one:
a.$4,727
b.$6,061
c.$372,000
a.$4,727
Which account is paired with another account type that has an opposite normal
balance to the paired account; reduces or increases the balance in the paired account
at the end of a period?
Select one:
a.Accounts receivable
b.Contra account
c.Principal
b.Contra account
The gross profit method is used to estimate inventory values by applying a standard
gross profit percentage to the company's sales totals when a physical count is not
possible.
Select one:
a.True
,b.False
a.True
The direct write-off method delays recognition of bad debt until the specific customer
accounts receivable is identified.
Select one:
a.True
b.False
a.True
The VWX Company collects an honored note with a maturity date of 36 months from
establishment, a 8% interest rate, and an initial loan amount of $40,000. Which
accounts are used to record collection of the honored note at maturity date?
Select one:
a.Interest Revenue, Interest Expense, Cash
b.Interest Receivable, Cash, Notes Receivable
c.Interest Revenue, Interest Receivable, Cash, Notes Receivable
c.Interest Revenue, Interest Receivable, Cash, Notes Receivable
Which inventory costing method is almost always done on a perpetual basis?
Select one:
, a.First-in, First-out
b.Last-in, First-out
c.Specific identification
c.Specific identification
The PQR Company has a balance of $25,000 in accounts receivable and a $5,000
balance in the allowance for doubtful accounts. What is the net realizable value?
Select one:
a.$5,000
b.$20,000
c.$30,000
b.$20,000
When would a company use the specific identification method of inventory cost
allocation?
Select one:
a.Petty cash fund
b.Expensive items that are highly customized
c.Consigned goods
b.Expensive items that are highly customized
