5/13/2021 QUIZ 2_CURRENT LIABILITIES

QUIZ 2_CURRENT LIABILITIES

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2. FULL NAME *

3. SECTION *

4. PROFESSOR'S NAME *

INSTRUCTIONS:
I. TRUE/ FALSE QUESTIONS: Type WRONG if the statement is correct, and CORRECT if the statement is WRONG.
QUIZ 2. PROBLEMS: Calculate what is being asked. Choose the best answer. For NON MC, type your answer in numerical values only.

2_CURRENT
LIABILITIES

5. Loyalty award is a marketing scheme whereby an entity grants award credits

to customers and the entity can redeem the award credits in exchange for
free or discounted goods or services

CORRECT

6. The consideration allocated to the award credits is measured at carrying

amount of goods to be received in exchange

CORRECT

https://docs.google.com/forms/d/1J0Yi8a-XKKvdCVKcrNb782F-HFHIPlnQkYoCEXUAGgo/edit 1/
7. Under a customer loyalty program, if a third party supplies the awards and
the entity is collecting the consideration for the award credits as principal in
the transaction the entity shall recognize immediately revenue equal to the
gross consideration allocated to the award credits.

WRONG

8. Under a customer loyalty program, if the entity supplies the awards itself,
the consideration allocated to the award credits shall be recognized as
revenue immediately

CORRECT

9. The award credits granted to customers under a customer loyalty program

is often described as Awards

CORRECT

10. Unearned rent revenue would normally appear in the statement of

financial position as current asset

CORRECT

11. Estimated liabilities are disclosed in financial statements by

appropriate classifying them as regular liabilities in the statement of
financial position

WRONG

12. Rent revenue collected one year in advance should be reported as

separate item of shareholder's equity

CORRECT

13. Provisions shall be recognized for restructuring costs after a binding

sale agreement has been signed

WRONG
14. A provision for restructuring is required when the entity has a detailed
plan for the restructuring and the entity has raised valid expectations in
the minds of those affected that the entity will carry out the restructuring
by announcing its main features to those affected by it.

WRONG

15. Sia Company sells washing machines that carry a three-year warranty
against manufacturer's defects. Based on the entity's experience, warranty
costs are estimated at P200 per machine. During the current year, Sia
Company sold 1,200 washing machines and paid warranty costs of
P130,000. In its income statement for the current year, what amount should
Sia Company report as warranty expense?

Mark only one oval.

170,000

720,000

240,000

550,000
16. On December 31, 2021, what amount should be reported as unearned revenue?

Mark only one oval.

510,000

570,000

850,000

425,000

17. In the December 31, 2021 statement of financial position, what amount should
be reported as accrued liabilities?

Mark only one oval.

260,000

185,000

210,000

245,000
18. Calculate the net salary of Lani for the month. (TYPE YOUR ANSWER IN
NUMERICAL VALUES ONLY)

27,747

19. Calculate the TOTAL Payroll expense of AAA Company for the month. (TYPE
YOUR ANSWER IN NUMERICAL VALUES ONLY)

1,980

20. Calculate the TOTAL Remittance of amount withheld and contributions. (TYPE YOUR
ANSWER IN NUMERICAL VALUES ONLY)

4,233
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