Republic of the Philippines

Department of Education
Region I
Schools Division of Ilocos Norte
CAESTEBANAN NATIONAL HIGH SCHOOL
#14 Sinamar, Banna, Ilocos Norte

FUNDAMENTALS OF ACCOUNTANCY, BUSINESS and MANAGEMENT 1

Summative Exam

Name: _________________________________ Score: ____________

I. Read and analyze the following questions. Write the letter of your answer in the space provided.

___1. Which of the following companies is not a merchandising company?

a. Candy store c. Furniture store
b. Car Wash d. Wholesale parts company

___2. When do physical count of the inventory of a certain company usually took place?
a. At the end of the fiscal year.
b. At the peak of the busy season.
c. At the start of the fiscal year.
d. In the middle of the fiscal year.

___3. When does a merchandiser earns an operating income/net income of exactly zero?
a. Net sales equals cost of goods sold
b. Operating expenses equal net sales
c. Cost of goods sold equals gross margin
d. Gross profit equals operating expenses

___4. What is the due date if a sale on March 21 has terms of 2/10, n/25?
a. March 31 c. April 15
b. April 10 d. April 30

___5. How does the General Journal (GJ) record all financial transactions?
a. Chronological c. Order
b. Interval d. Sequential

___6. What journal records a simple journal entry that contains only one debit and one credit account?
a. General Journal c. Subsidiary Ledger
b. General Ledger d. T-Accounts

___7. What is the discount taken by the buyer for the early payment of an invoice?
a. Cash discounts c. Sales discounts
b. Purchase discounts d. Trade discounts

___8. What document is issued by the seller authorizing the return of merchandise or grant of an
allowance?
a. Credit Memorandum c. Invoice
b. Debit Memorandum d. Official Receipt

___9. Which of the following document evidences the receipt of cash by the seller?
a. Credit Memorandum c. Invoice
b. Debit Memorandum d. Official Receipt

___10. What is the transportation arrangement that passes ownership to the goods to the buyer only
when the buyer receives the merchandise?
a. FOB Destination b. FOB Shipping Point

___11. What is the shipping term if the buyer shoulders the shipping cost?
 a. FOB Destination b. FOB Shipping Point
___12. What discount encourages the buyers to purchase goods because of mark-downs from the list
price?
a. Cash discounts c. Sales discounts
b. Purchase discounts d. Trade discounts

___13. Which one is called the book of original entry?

a. General Journal c. Subsidiary Ledger
b. General Ledger d. T-Accounts

___14. Which one is called the book of final entry?

a. General Journal c. Subsidiary Ledger
b. General Ledger d. T-Accounts

___15. Which inventory system records revenues from sales when sales are made, but no attempt is
made on the sales date to record the cost of goods sold?
a. Periodic c. Perpetual
b. Periodical d. Preliminary

___16. Which inventory system records both the sales amount and the cost of goods sold when each
item of merchandise is sold?
a. Periodic c. Perpetual
b. Periodical d. Preliminary

___17. I. Merchandise inventory could include goods that are in transit.

II. Sales Returns and Allowances is described as a contra-revenue account.
Which is true about the two statements?
a. Only I is true c. Both are true
b. Only II is true d. Both are false

___18. What is considered a sin in the whole accounting process?

a. Abnormal Balance c. Imbalance
b. Force Balance d. Zero Balance

___19. Which of the following specify the amount of cash discount and time period during which a
discount is offered may permit the buyer to claim a cash discount for the prompt payment of a
balance due?
a. Credit Period c. Discount Period
b. Credit Terms d. Time Period

___20. Which process shows when entering transactions into the Special Journals?
a. Accounting c. Journalizing
b. Bookkeeping d. Posting

___21. Which of the following is an authorization made by the buyer to the seller to deliver the
merchandise as detailed in the form?
a. Invoice c. Purchase Requisition
b. Purchase Order d. Receiving Report

___22. What is the conclusion on the use of Posting Reference (P.R.) in transactions journals?
a. It completes the whole Bookkeeping process
b. It provides an Audit trail with ease of reference
c. It proves the accuracy of the Account Title/s usage
d. It counts the number of frequency usage of the Account Title/s

___23. How would you show your understanding when recording transactions, such as cash investment,
loans, cash sales, collections of customers’ accounts, and cash refund?
a. Cash Receipts Journal
b. General Journal
 c. Special Journal
d. Transaction Journal

___24. What information would you use to record sales of Merchandise, cash sales of retailers like in the
Department Stores which rang on Cash Register Tapes (CRTs), and summarized in a Cash
Summary Report?
a. Cash Disbursements Journal
b. Cash Receipts Journal
c. Purchases Journal
d. Sales Journal

___25. Which of the following is true if a sale of merchandise is made on credit?

a. Decreases cash
b. Decreases sales
c. Increases cash
d. Increases accounts receivable

II. Performance Task (25 points)

RECORDING SALES TRANSACTIONS: Prepare the journal entries to record the following
sales transactions of Leonila Generales Company whose credit terms are 2/10, n/30:

June 1 Cash sales, ₱180,000.

4 Sales on account, ₱650,000.
7 Received returned merchandise sold on account, ₱90,000.
10 Collected the amount due from credit sales.

Date Account Titles and Explanations P.R. Debit Credit

1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20

Prepared by:
Risaphel J. Salem
Subject Teacher