LEARNING ACTIVITY 1

1. Assets - Properties or resources owned by the business.

2. Accounting - Keeps track of the activities of the business and reports back its financial position
and result of operation.
3. Pacioli - Modern bookkeeping can be traced from the book Summa de Aritmetika written by
4. Liabilities - Obligations of the business owing to outsiders such as banks and suppliers.
5. Decision Making - Primary reason for preparing financial reports in accounting.
6. Business - An economic unit which buys and sells goods or services and where profit is its
primary motive.
7. Debtor - One who borrows money or buys goods and services promising to pay in the future.
8. Creditor - Primary source of assets needed by business other than from the owner/investor.
9. Business Risk - An endeavor, like a business, has always an element of uncertainty.
10. Entrepreneur - A person who puts up a business to sell an innovative idea or product created.
11. Manager - Directs the operation of the business, decides what to buy or sell, and controls all
phases of activities.
12. Financial Statements - Reports containing information that are directed to the common needs of
all users.
13. Service - Philippine Airlines is an example of this type of operation.
14. Transactions - Activities taking place in business, such as buying and selling, which are measured
and recorded in terms of money.
15. Bookkeeping - Routine work by the accounting department in recording, classifying and
summarizing business activities.
16. Merchandising - Mercury drugstore is an example of this type of operation.
17. Stakeholders - Any person or entity who has an interest over the financial position and
performance of the business.
18. Accounting System - An organized system wherein transactions are documented and measured
through a process of recording, classifying and summarizing and as a result of generated reports.
19. Revenues - Amounts received for goods or services sold which enhances assets of the business.
20. Statement of Financial Position - Accounting report that shows the net worth of the business by
listing its assets and liabilities.
21. Investor - I look for information regarding the firm’s performance before I decide to buy, hold or
transfer my interest over it.
22. Manager- I am always after the achievement of the company’s goals and so I make periodic
review and revisions of its program of activities.
23. Lender - I look for information that will help me assess borrower’s ability to pay, determine how
much to give, and fix the date of payment.
24. Customer - I consider not only the price and quality of the product but also the company’s
reputation and additional benefits.
25. Employee - I see to it that I perform well so that the company will earn profit and give me higher
remuneration and additional benefits.
26. Government - I require all firms to submit regularly their financial statements to ensure that they
have complied with all the rules and regulations provided by law.
27. Supplier - I look for information to judge whether the customer will be to pay the goods I will
deliver on the date that the credit is due.
28. Private Accounting - This is a career field where a person is an employee of a company as
controller internal auditor, budget officer or financial analyst.
 29. Budget Officer - The professional who helps prepare quantitative plans by product, department
or activity to ensure that the company’s goal is achieved.
30. Fraud Examiner - The professional who assists the lawyer in solving illegal activities such as
embezzlement of company funds, inside trading, theft.
31. External Auditor - An independent professional who renders judgment on the fair presentation
of the company’s financial statements after reviewing its accounting records.
32. Public Accounting - Firms like SGV, KPMG, Punong Bayan offer their services such as
bookkeeping, auditing, accounting and tax, among others.
33. Electronic Data Processing Head - An officer in charge of the operation, maintenance and
control of the electronic hardware and software of the company.
34. Controller - Officer of a firm whose area of responsibility covers management accounting,
financial accounting, tax, budgeting and internal auditing.
35. Financial Accounting - An accounting area that provides reports to external users such as the
banks and suppliers.
36. Cost Accounting - An accounting area which is concerned with systematic recording and
measurement of the cost of manufacturing a product or the cost of rendering service.
37. Management Accounting - An accounting area which is responsible for preparing reports for
internal use of the company in planning, directing and controlling its various operations
38. Government Accounting - An accounting area which deals with the administration or use of
public funds to bring about service to the community.
39. Auditing - An accounting area which involves the review and examination of accounting records
and financial statement and from which a professional and unbiased opinion is given Forensic
40. Accounting - An accounting area combined with auditing and investigative skills to help solve
crimes such as misappropriation of funds by tracing the paper and money trail.
41. Bookkeeping - Basic accounting process which involves the repetitive task of recording and
classifying transactions before summarizing the data into financial reports.
42. PFRS Council - Agency tasked in reviewing, preparing and codifying standards for use in
accounting practice.
43. PRC - The commission that regulates the practice of all professionals and is mandated to grant
licenses to candidates who have successfully passed the government licensure examinations.
44. SEC - Implements laws such as Code of Corporations in the Philippines, including corporate
governance, trading in the capital markets, mergers and consolidations.
45. BSP - Financial market is its prime concern - foreign exchange, investments, stock markets,
payment and settlement system, projection and control of inflation.
46. IASB - Coordinates with the national standards setters of different countries in matters involving
the convergence of the standards with the IFRS for financial reporting.
47. Board of Accountancy - Discharges its mandate of supervising, regulating and controlling the
practice of accounting professionals including the conduct of the CPA licensure exam.

LEARNING ACTIVITY 2
ASSET LIABILITY CAPITAL REVENUE EXPENSE
Accounts Unearned Net Worth Professional Fees Freight-Out
Receivable Revenue
Unused Supplies Accounts Payable Proprietorship/ Service Income Cost of Money
Investment Borrowed
Prepayments Mortgage Payable Residual Interest Rent Income Depreciation
Interest Amount owed Allocated cost of
Receivable from bank fixed assets
Cost of Creditor’s Equity Employer’s Share
Constructing the in the payment of
Building SSS
Liabilities + Bank Loan
Capital
Assets -
Proprietorship
Unearned
Subscription
Asset - Capital

1. Cash - Coins and bills in the possession of the business

2. Owner’s Equity - Right of the owner in the business
3. Freight-Out - Delivery expense for merchandise sold
4. Accounting Equation - Assets equal liabilities and owner’s equity
5. Assets - Properties of the business, tangible or intangible
6. Salary Expense - Amount paid for services of employees
7. Professional Fees - Income derived in the practice of profession
8. Equity/Capital - Residual interest
9. Depreciation - Systematic allocation of eh cost of fixed assets over its estimated useful life
10. Owner’s Equity - Assets minus liabilities
11. Accounts Receivable - Collectible from clients for services rendered on account
12. Utilities Payable - Obligations owed for the use of electricity
13. Taxes and Licenses Payable - Amount due to government
14. Notes Receivables - Amount collectible from clients and supported with promissory notes
15. Freight-In - Cost of transportation for merchandise purchased
16. Store Supplies - Plastic bags, tapes, stapler fillers, etc. used in the stores
17. Advertising Expense - Costs incurred to promote the products of the business
18. Account names – Account titles
19. Equities – rights
20. Withdrawal - Diminution of investment

47. 29,000
48. 21,000
49. 22,000
50. 200,000
LEARNING ACTIVITY 3
INCREASE IN EQUITY DECREASE IN EQUITY
Fees Earned Wages Expense
Lawn Care Revenue Withdrawals
Investment Supplies Expense
 TRANSACTIONS +ASSETS -ASSETS +LIABILITIES -LIABILITIES +EQUITY -EQUITY NONE

Received cash from ✓ ✓

owner as an additional
investment. 
Purchased supplies on ✓ ✓
account
Paid rent for the current ✓ ✓
month
Received cash for ✓ ✓
services sold to
customers
Returned some defective ✓ ✓
supplies previously
purchased on account
Paid insurance ✓
premiums in advance
Paid cash to creditor for ✓ ✓
purchases on previously
bought on account
Charged customers for ✓ ✓
services sold on account
Paid cash to a customer ✓ ✓
as a refund for an
overcharge
Received cash on ✓
account from customers
Owner withdrew cash ✓ ✓
for personal use
Recorded the cost of ✓ ✓
supplies used during the
year
Received invoice for ✓ ✓
electricity used
Paid wages ✓ ✓
Purchased a truck for ✓
cash

LEARNING ACTIVITY 4
ASSET LIABILITY EQUITY INCOME EXPENSE
Land Improvement Deferred Income Alexieva Valerio, Service fee earned Loss due to theft
Capital
Unexpired Notes due to Eugenio Velasco, Gain on sale of land Audit and legal fees
insurance suppliers Personal paid
Investment in real Unearned rent Fees earned Insurance expense
estate income
Notes due from Pre-collected rent Commission Commission
customers realized expense
Rent receivable Accrued utilities Sales 13th month pay of
employees
Franchise Accrued taxes Gain on sale of Depreciation – office
investments equipment
Patents Loans payable Bad debts
Investment in stock Unearned interest Amortization –
income franchise
Goodwill Advances from Interest on loan
associates from the bank
Accrued rent Research expenses
income
Prepaid advertising Salaries and wages
expense
Machinery Bank charges
Tools, molds and Depreciation –
dies Equipment
Advances to Supplies used
employees
Doubtful accounts
Bonus and
allowances
Cost of sales
Retainer’s fees
incurred
1. What is the ending balance (July 31) of
cash? 1,150,000
2. What is the ending balance (July 31) of
accounts receivable? 40,000
3. What is the ending balance (July 31) of
furniture and fixtures? 300,000
4. What is the ending balance (July 31) of
transport buses? 3,799,800
5. What is the ending balance (July 31) of
accounts payable? 150,000
6. What is the ending balance (July 31) of
notes payable? 3,799,800
7. What is the ending balance (July 31) of rent
payable? 75,000
8. What is the ending balance (July 31) of
brown capital? 1,265,000

QUIZ NO. 1
1. Which of the following changes would most likely accompany an increase in an asset? Increase in equity
2. Which of the following changes would most likely accompany an increase in liability? Increase in asset
3. Jhocson is the sole owner and operator of Jhocson’s Company.  As of the end of its accounting period,
December 31, 2016, Jhocson’s Company has assets of P940,000 and liabilities of P300,000.  During 2017,
Jhocson invested an additional P65,000 and withdrew P45,000 from the business. What is the amount of
net income during 2017, assuming that as of December 31, 2017, assets were P995,000, and liabilities were
P270,000? 65,000
4. Total liabilities are P875,000, which is 70% of total assets. How much is the equity? P375,000
5. A business paid P7,000 to a creditor in payment of an amount owed. The effect of the transaction on the
accounting equation was to? decrease an asset, decrease a liability
6. Pacioli’s double entry bookkeeping system has been adapted to suit modern times. It still is an effective
recording system because information extracted tells the owner/manager: how much the business owes,
what profit the business has made, how much is owed to the business
7. When is income recognized as earned? At the time when goods or services are delivered to the
customer
8. Which of the following changes would most likely accompany an increase in the equity of the owner?
Increase in income
9. The accounts in the ledger of NUBD Co. are listed in alphabetical order.  All accounts have normal balances. The
total of all the assets is: 9,400
10. Which of the following is not a decision that the external data user would make? Whether or not to
expand the business operation in Mindanao
11. Which of the following transactions will decrease the total assets? Paid for the matured loan to the bank
12. Which of the following changes would most likely result in a decrease in the equity of the owner? Increase
in expense
13. The debt created by a business when it makes a purchase on account is referred to as an? account payable
14. Which of the following transactions will increase the owner’s equity? Service rendered to the client on
account basis
15. Which of the following is not a business transaction? make a sales offer
16. The accounting elements in the balance sheet include: assets, liabilities and equity
17. Which of the following changes would most likely accompany a decrease in an asset? Increase in expense
18. Creditors’ information needs involve making all of the following decisions, except: Whether or not to
invest in a credit instrument
19. A businessman owns an advertising company and a printing business. Based on this given situations, which
concept supports the idea that there are three separate persons with separate assets, liabilities, income and
expenses? Business entity principle
20. Recognition of expenses would generally result in: Decrease in the business enterprise’s assets,
decrease in owner’ s equity, Increase in the business enterprise’s liabilities
21. How does paying a liability in cash affect the accounting equation? assets decrease; liabilities decrease
22. Select the type of business that is most likely to obtain large amounts of resources by issuing shares.
Corporation
23. Which of the following is not a characteristic of accrual basis of accounting? Income is recognized only
upon collection from the customer.
The next three questions are based on the following transactions:
(1) The owner invested P36,000;
(2) P26,000 of supplies were purchased for cash;
(3) P23,000 was received for payment for services rendered by the business;
(4) A salary of P10,000 was paid to an employee and;
(5) P30,000 was borrowed from the bank.
24. What is the correct amount of total assets? P79,000
25. What is the correct amount of total liabilities? P30,000
26. What is the correct amount of total owner’s equity? P49,000
27. The liability of NUBD Company is one-third of the total assets. If the equity is P240,000, how much is the
liabilities? 120,000
28. How much is the cash balance at the end
of the period? P89,300
29. How much is the balance of furniture and
fixtures at the end of the period?
P12,500
30. How much is the balance of the Accounts
receivable at the end of the period?
P2,000
31. How much is the balance of Accounts
payable at the end of the period?
P14,800
32. How much is the balance of the Loan
Payable at the end of the period?
P25,000
33. How much is the total service income of the company at the end of the period? P29,500
34. How much is the total expenses of the company at the end of the period? P15,700
35. How much is the net income of the company at the end of the period? P13,800
36. How much is the ending balance of the proprietor’s capital? P88,800

37. What is the balance of cash as of

December 31? P149,000
38. What is the balance of Accounts
Receivable as of December 31?
P28,000
39. What is the balance of Accounts
Payable as of December 31?
P217,000
40. What is the balance of Jhocson,
Capital as of December 31?
P262,000

LEARNING ACTIVITY 5

DEBIT CREDIT
Drawings Notes Payable
Accounts Receivable Mortgage Payable
Utility Expense Capital
Automobiles Rent Revenue
Franchise Unearned Income
 The account to be credited is Fees Earned
2. Received an invoice for truck expenses to be paid in February.
The account to be debited is Truck Expense
The account to be credited is Accounts Payable
3. Paid utilities expense.
The account to be debited is Utilities Expense
The account to be credited is Cash
4. Received cash from customers on account.
The account to be debited is Cash
The account to be credited is Accounts Receivable
5. Paid employee wages.
The account to be debited is Wages Expense
The account to be credited is Cash
6. Withdrew cash for personal use.
The account to be debited is Cary Parsons, Drawings
The account to be credited is Cash
7. Utility bill is received; payment will be made in 10 days.
The account to be debited is Utility Expense
The account to be credited is Utility Payable
8. Paid the utility bill previously recorded in transaction
The account to be debited is Utility Payable
The account to be credited is Cash
9. Bought a three-year insurance policy and paid in full.
The account to be debited is Prepaid Insurance
The account to be credited is Cash
10. Received $7,000 from a contract to perform accounting services over the next two years.
The account to be debited is Cash
The account to be credited is Unearned Service Revenue
LEARNING ACTIVITY 6
 QUIZ NO.2
1. Which of the following errors, each considered individually, would cause the trial balance totals to be
unequal?
a payment of P1,311 to a creditor was posted as a debit of P3,111 to Accounts Payable and a debit of
P311 to Accounts Receivable
2. Which of the following entries records the collection of cash from cash customers? Cash, debit; Fees
Earned, credit
3. Which statement(s) concerning cash is (are) true? cash is increased by debiting
4. Which of the following is true about a T-Account? Left hand side of the T-Account is called a debit.
5. Cash was paid by Ezra’s Alarm Service to creditors on account.  Which of the following entries for Ezra’s
Alarm Service records this transaction? Accounts Payable, debit; Cash, credit
6. What effect does this journal entry have on the accounts? Decrease accounts payable, decrease cash

7. Which of the following entries records the receipt of cash from patients on account? Cash, debit; Accounts
Receivable, credit
8. Which of the following entries records the acquisition of office supplies on account? Office Supplies, debit;
Accounts Payable, credit
9. Revenue should be recognized when the service is performed
10. Prepare a trial balance.  The total of the debits is P13,300

11. An account is said to have a debit balance if the amount of the debits exceeds the amount of the credits
12. What is the best explanation for this journal entry? Purchased supplies on account
13. The owner’s equity will be reduced by all of the following accounts except: Revenues
14. A patient has a physical examination and asks the bookkeeper to mail the bill.  The bookkeeper should
Accounts Receivable, debit; Fees Earned, credit
15. Prepare a trial balance.  The total of the credits is P13,800

16. The process of initially recording a business transaction is called journalizing

17. Which of the following transactions correctly maintains the equality in the accounting equation? To record
the purchase of computer equipment, computer equipment and cash is decreased by P46,000.
18. Which one of the statements below is not a purpose for the journal? to show increases and decreases in
accounts
19. Which of the following entries records the payment of an account payable? debit Accounts Payable;
credit Cash
20. Which group of accounts is comprised of only assets? Prepaid Expenses, Buildings, Patents
21. Which of the following entries records the investment of cash by Sarah, owner of a proprietorship? debit
Cash; credit Sarah, Capital
22. NUBD’s Clinic purchased X-ray equipment for P4,000, paid P1,275 down, with the remainder to be paid
later.  The correct entry would be Dr: Equipment 4,000; Cr: Accounts Payable 2,725; Cr: Cash 1,275
23. Which of the following applications of the rules of debit and credit is true? increase Supplies Expense
with a debit and the normal balance is a debit
24. A debit balance in which of the following accounts would indicate a likely error? Notes Payable
25. Which of the following entries records the withdrawal of cash by Ruth, owner of a proprietorship, for
personal use? debit Ruth, Drawing; credit Cash
26. Which of the following is correct? Assets: P7,850; Liabilities: P1,250; Liabilities: P6,600
27. Randomly listed below are the steps for preparing a trial balance:
(1) Verify that the total of the Debit column equals the total of the Credit column.
(2) List the accounts from the ledger and enter their debit or credit balance in the Debit or Credit column of
the trial balance.
(3) List the name of the company, the title of the trial balance, and the date the trial balance is prepared.
(4) Total the Debit and Credit columns of the trial balance.
What is the proper order of these steps? (3), (2), (4), (1)
28. Which of the following entries records the payment of rent for the current month? Rent Expense, debit;
Cash, credit
29. On the chart of accounts, the balance sheet accounts are normally listed in the following order assets,
liabilities, owner’s equity
30. Which of the following statements is not true about liabilities? Liabilities do not include wages owed to
employees of the company.
31. Office supplies were sold by Lucas’ Alarm Service at cost to another repair shop, with cash received.  Which
of the following entries for Lucas’ Alarm Service records this transaction? Cash, debit; Office Supplies,
credit
32. A credit balance in which of the following accounts would indicate a likely error? Salary Expense
33. Daniel invests P65,000 into his new business.  How would the journal entry for this transaction be entered
in the journal? Dr: Cash 65,000; Cr: Daniel, Capital 65,000
34. Which of the following is not a correct rule of debits and credits? the normal balance for revenues and
expenses is a credit
35. Of the following which is true about assets? Assets include physical and intangible assets.
36. Which of the following entries records the receipt of cash for two months' rent? The cash was received in
advance of providing the service Cash debit; Unearned Rent, credit.
37. Which of the following entries records the receipt of a utility bill from the water company? debit Utilities
Expense; credit Accounts Payable
38. The classification and normal balance of the accounts payable account is a liability with a credit balance
39. The debit side of an account is the left side of the account
40. What effects does this journal entry have on the accounts? Increase to Land and decrease to Cash

41. How much is the ending balance of cash?

P62,750
42. How much is the ending balance of Notes
Payable? P12,500
43. How much is the ending balance of Total
Assets? P116,000
44. How much is the total expenses for the
period? P26,000
45. How much is the ending capital balance?
P91,500
 LEARNING ACTIVITY 7

A. Prepaid Expense (expense method) D. Unearned Income (liability method) G. Depreciation

B. Prepaid Expense (asset method) E. Accrued Expense H. Doubtful Accounts
C. Unearned Income (income method) F. Accrued Income
1. Debit Insurance Expense; Credit Prepaid Insurance B
2. Debit Supplies on hand; Credit Supplies expense A
3. Debit Bad debts; Credit Allowance for bad debts H
4. Debit Tool expense; Credit Tools B
5. Debit Taxes expense; Credit Accrued Taxes E
6. Debit Accrued service income; Credit Service income F
7. Debit Salaries expense; Credit Salaries payable E
8. Debit Depreciation expense; Credit Accumulated depreciation G
9. Debit Service income; Credit Unearned service income C
10.Debit Unearned service income; Credit Service income D

11.Meralco bills the company for December light service Debit Utilities expense, Credit Utilities
payable
12.Prepaid insurance has expired. Debit Insurance expense, Credit Prepaid insurance
13.Equipment has a useful life of 10 years. Debit Depreciation expense, Credit Accumulated
depreciation
14.Customer’s 5% one-year note was received on December 1. Debit Accrued interest income,
Credit Interest income
15.One month of the advance rent of tenant has been earned. Debit Unearned rent, Credit Rent
income
Income Statement, Income Statement, Balance Sheet, Balance Sheet,
Debit Credit Debit Credit
Rent Expense Income from services Supplies on hand Anna Faithful,
Capital
Depreciation – Gain on sale of land Unexpired Mortgage Payable
Machinery Insurance
Taxes Investment in Allowance for
shares of stocks doubtful accounts
Advertising Building Notes payable
Loss due to fire Royalty receivable Accrued wages
Profit of the perio Anna Faithful, Profit of the period
Drawings
Accounts receivable
 LEARNING ACTIVITY 8

Adjusting Entries:
Income Statement:

Owner’s Equity Statement:

QUIZ #3
1. An accrued revenue should be recorded by a seller when a service is
rendered before receipt of cash
2. If a P2,500 adjustment for depreciation is omitted, which of the following
financial statement errors will occur? owner’s equity will be overstated
3. An adjusting entry made to record accrued interest on a note payable due
next year consists of a debit to Interest expense and a credit to Interest
payable
4. Which of the following transactions would most likely not need an adjusting
entry at the end of the period? payment of this month’s rent
5. Statement 1: Accounts reported on the balance sheet that are carried
forward from year to year are known as temporary accounts.
Statement 2: Net income is shown on the work sheet in the Income Statement debit column and the
Balance Sheet credit column.
Only Statement 2 is true
6. HFL purchased an equipment costing P100,000 on July 1, 2016. The equipment has an estimated useful life
of 10 years with an estimated residual value of P10,000. The balance of the Accumulated depreciation
account on December 31, 2017 is: P13,500
7. A business received cash of P30,000 in advance for revenue that will be earned later. The cash receipt entry
debited cash and credited unearned revenues for P30,000. At the end of the period, P11,000 is still
unearned. The adjusting entry for this situation will debit unearned revenues and credit revenues for
P19,000
8. An adjusting entry can include a debit to a liability and a credit to a revenue
9. From the view point of the firm receiving the cash, an item that represents services that have been paid for
by the customer, but have not yet been provided to that customer by the firm which received the cash, is
called an unearned revenue
10. A deferred expense should be recorded when cash is paid before an expense has been incurred
11. Statement 1: When accounts do not appear on the unadjusted trial balance but are needed to post
adjustments, they are simply added to the account title column.
Statement 2: The balance in the capital account on the worksheet will equal the amount presented in the
balance sheet.
Only statement 1 is true
12. Prepaid Insurance of P72,000 represents payment for 24 months starting June 1, 2017. The adjustment on
December 31, 2017 will be: Dr: Insurance Expense 21,000; Cr: Prepaid Insurance 21,000
13. Deferred expense should be reported as assets on the balance sheet
14. An adjusting entry cannot include a debit to an asset and a credit to a liability
15. Accrued revenues should be reported as revenues on the income statement and assets on the balance
sheet
16. Which of the following accounts would likely not need to be adjusted at year-end? Land
17. Failure to record depreciation at year-end will result in an overstatement of total assets
18. Deferred revenues should be reported as liabilities on the balance sheet
19. Which of the following errors would cause unequal totals in the trial balance? The firm recorded P21,000
received from a customer in advance for the delivery of goods as a debit of P1,000 to cash and a credit of
P21,000 to sales
20. The adjustment for that portion of revenue received in advance which now has been earned is to debit
unearned revenues and credit Service revenues
21. Office Supplies were P9,000 at the end of January and P11,400 at the end of February. During February,
Office Supplies Expense equaled P3,000. How much cash was paid for office supplies during February?
P5,400
22. A company that pays employees every two weeks has paid workers P375,000 in wages and salaries for
work completed during 2017. In addition, the employees earned one week’s salary of P7,200 at the end of
December that will be paid as part of P14,400 payroll at the end of the first week of January 2018. How
much should the company report for salaries and wages expense for 2017? P382,200
23. Wages Payable were P3,500 at the end of September and P2,800 at the end of October. Wages Expense for
October was P18,000. How much cash was paid for wages during October? P18,700
24. HFL, a law firm began November with office supplies of P16,000. During the month, the firm purchased
supplies of P29,000. On November 30, supplies on hand totaled P21,000. Supplies expense for the period is
P24,000
25. At the beginning of 2017, a company purchased a fire insurance policy covering a property for a period of
two years. The P5,600 cost of the policy was paid in cash. At the end of 2017, the company will reduce
Prepaid Insurance for this policy by P2,800
26. Which of the following is an example of an adjusting entry? recording depreciation expense on a truck
27. Which of the following events would be associated with an end-of-period adjustment? the recording of
depreciation on equipment
28. A deferred revenue should be recorded by a seller when a customer pays for a service before the service
is rendered
29. Unearned Revenue was P6,000 at the end of February and P7,500 at the end of March. Service Revenue was
P42,000 for the month of March. How much cash was received for services provided during March?
P43,500
30. A company has P1,500 of supplies on hand at the end of 2016. During 2017, P2,750 of supplies were
purchased. A count of supplies on hand at the end of 2017 found an inventory of P875. What was the
amount of supplies expense for 2017? P3,375
31. If on December 31, 2017, the insurance still unexpired amounted to P2,000, the adjusting entry would contain a
credit to Prepaid Insurance for P3,000
32. If on Dec. 31, 2017, supplies on hand were P2,000, the adjusting entry would contain a debit to Supplies
Expense for P13,000
33. If the estimated depreciation for office equipment were P20,000, the adjusting entry would contain a credit to
Accumulated depreciation - Office Equipment for P20,000
34. If as of December 31, 2017 the rent of P10,000 for December had not been recorded or paid, the adjusting entry
would include a debit to Rent Expense for P10,000
35. If service totaling P12,500 had been performed but not yet billed, the adjusting entry to record this would
include a credit to Service Revenues for P12,500
36. The

adjusting entry for Store Supplies would include a debit to Store Supplies Expense for P7,000
37. The adjusting entry to record the amount of service revenues earned during the period would include a debit to
Unearned Service Revenues for P9,000
38. The adjusting entry for the insurance policy would include a credit Prepaid Insurance for P5,000
39. The adjusting entry to record the accrued interest on the note would include a credit to Interest Income for
P1,000
40. Net income for the period is P18,500