- | Page
UTA ACCOUNTING ENTRA NCE
EXAM, QUESTIONS WITH
CORRECT ANSWERS
Question :Which of the following would not be
considered a current asset? All of the above are current assets.
Correct answer:All of the above are current assets.
Question :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 answer:D: Insurance Expense 2,000 C : Prepaid Insurance 2,000
Question :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:
- | Page
Correct answer:D : Purchases 100 C: Accounts Payable 100
Question :Jones Dairy purchased a new milking machine
for $40,000 cash. To record the transaction on Jones'
books, you would:
Correct answer:debit an asset account and credit an asset
account.
Question :Rent Expense typically would have:
Correct answer:a debit balance.
Question :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 answer:purchases and sales of machinery cannot
be determined from the information given.
Question :A double-entry system of accounting requires
that each transaction or event be recorded:
- | Page
Correct answer:in at least two different accounts.
Question :The trial balance should be prepared:
Correct answer:Before financial statements are prepared.
Question :At the end of an accounting period when
accounts are ready to be closed, which of the following activities must be performed?
Correct answer:Make closing entries and prepare post
closing trial balance
Question :Gross profit is calculated by:
Correct answer:subtracting cost of goods sold from net
sales.
Question :The operating expense section of an income
statement for a wholesaler would not include:
Correct answer:cost of goods sold.
- | Page
Question :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.� ℎ � � � � � � � , � � �