UTA Entrance Accounting Exam
Questions and Answers16
Which cash flow is an operating activity?
purchase of long term assets
repayment of long term debt
collecting cash from customers
paying a dividend to shareholders - ANSWERScollecting cash from customers
A company earned $5,000 in revenues, collected $7,500 from customers and paid $3,000 for
expenses incurred this period. What will be reported on the financial statements for this
period? - ANSWERSEquity and assets are increased
Which of the following would not be a statement that reports services provided and the cost of
providing services?
statement of income
statement of earnings
statement of financial position
statement of operations - ANSWERSstatement of financial position
Statement of Financial Position - ANSWERSbalance sheet
other names for the income statement (3) - ANSWERSstatement of income
statement of earnings
,statement of operations
A balance sheet reports cash of $3,000, accrued expenses of $1,300, equipment of $10,000 and
common stock of $2,500. Retained earnings must be: - ANSWERS$9,200
If net income after tax is $42,000, the tax rate is 30%, and total expenses not including tax
expense are $126,000, revenues must be: - ANSWERS$186,000
Find what the net income was before taxes and add it to expenses to get the total revenue.
The financial statement that reports what the company owns and what the company owes is
the - ANSWERSbalance sheet
The balance sheet shows assets, liabilities, and equity which show what is owned and what is
owed.
What is supposed to "balance" on the balance sheet? - ANSWERSassets = liabilities + owner's
equity
The purpose of financial accounting is to provide - ANSWERSfinancial information to external
users
The accounting equation is - ANSWERSassets = liabilities + equity
Which financial statement provides information related to the financial performance of a
company during a specific period? - ANSWERSincome statement
The income statement reports earning for a company during a specific time period.
, A company reports net income when - ANSWERSservices provided are greater than the cost to
provide the services
Which of the following is considered and expense?
prepaid expense
cost of goods sold
sales
building - ANSWERScost of goods sold
The government agency with legal authority over financial reporting of U.S. public companies is
called - ANSWERSsecurities exchange commission (SEC)
FASB has no legal authority
Which financial statement reports dividends paid to shareholders? - ANSWERSstatement of
owners equity
Dividends are not reported on the income statement, it is not an expense. They are netted into
retained earnings on the balance sheet.
assets typically include - ANSWERSaccounts receivable and equipment
What financial document is for the specific purpose of reporting cash flows? - ANSWERScash
flow statement
Questions and Answers16
Which cash flow is an operating activity?
purchase of long term assets
repayment of long term debt
collecting cash from customers
paying a dividend to shareholders - ANSWERScollecting cash from customers
A company earned $5,000 in revenues, collected $7,500 from customers and paid $3,000 for
expenses incurred this period. What will be reported on the financial statements for this
period? - ANSWERSEquity and assets are increased
Which of the following would not be a statement that reports services provided and the cost of
providing services?
statement of income
statement of earnings
statement of financial position
statement of operations - ANSWERSstatement of financial position
Statement of Financial Position - ANSWERSbalance sheet
other names for the income statement (3) - ANSWERSstatement of income
statement of earnings
,statement of operations
A balance sheet reports cash of $3,000, accrued expenses of $1,300, equipment of $10,000 and
common stock of $2,500. Retained earnings must be: - ANSWERS$9,200
If net income after tax is $42,000, the tax rate is 30%, and total expenses not including tax
expense are $126,000, revenues must be: - ANSWERS$186,000
Find what the net income was before taxes and add it to expenses to get the total revenue.
The financial statement that reports what the company owns and what the company owes is
the - ANSWERSbalance sheet
The balance sheet shows assets, liabilities, and equity which show what is owned and what is
owed.
What is supposed to "balance" on the balance sheet? - ANSWERSassets = liabilities + owner's
equity
The purpose of financial accounting is to provide - ANSWERSfinancial information to external
users
The accounting equation is - ANSWERSassets = liabilities + equity
Which financial statement provides information related to the financial performance of a
company during a specific period? - ANSWERSincome statement
The income statement reports earning for a company during a specific time period.
, A company reports net income when - ANSWERSservices provided are greater than the cost to
provide the services
Which of the following is considered and expense?
prepaid expense
cost of goods sold
sales
building - ANSWERScost of goods sold
The government agency with legal authority over financial reporting of U.S. public companies is
called - ANSWERSsecurities exchange commission (SEC)
FASB has no legal authority
Which financial statement reports dividends paid to shareholders? - ANSWERSstatement of
owners equity
Dividends are not reported on the income statement, it is not an expense. They are netted into
retained earnings on the balance sheet.
assets typically include - ANSWERSaccounts receivable and equipment
What financial document is for the specific purpose of reporting cash flows? - ANSWERScash
flow statement
