Question #1

The accounting clerk purposely

recorded a charge sale as a cash sale.
Which of the statement is wrong,
assuming that the business uses perpetual
system??

a. The cash balance is overstated

b. The cost of goods sold is not affected
c. Net working capital is not affected
d. The total of the current asset is understated
Question #2

Which of the following events would

not require a journal entry??

a. Purchase a one-year insurance policy

b. Agreement to perform a service at a future date
c. Performance of a service agreed to at a past date
d. Payment for a service performed previously
Question #3

An adjusting entry will not take the

format of which one of the following
entries?
a. A debit to an expense account and a credit to an asset account
b. A debit to an expense account and a credit to a revenue account
c. A debit to an asset account and a credit to a revenue account
d. A debit to a liability account and a credit to a revenue account
Question #4

As independent (or external)

auditors, CPAs are primarily responsible
for
a. Preparing financial statements in conformity with GAAP
b. Certifying the accuracy of financial statements
c. Expressing an opinion as to the fairness of financial statements
d. Filing financial statements with the SEC
Question #5

It focuses on general purposes reports

on financial position, performance and
cash flows.
a. Auditing
b. Managerial Accounting
c. Bookkeeping
d. Financial Accounting
Question #6

Which of the following is an internal

user of a company’s financial information
a. Members of the board of directors
b. Creditors with long-term contract with the company
c. Holders of the company’s bonds
d. Stockholders in the company
Question #7

A businessman owns an advertising

company and a printing business. Based
on this given situation, which concept
supports the idea that there are three
separate persons with separate assets,
liabilities, income, and expenses??
a. Periodicity Concept
b. Business Entity Principle
c. Matching Concept
d. Concept of equality of value received and vale given up
Question #8

They are the attributes that make the

information provided in financial
statements useful to users
a. Basic Features
b. Basic Elements
c. Basic Assumptions
d. Qualitative Characteristics
Question #9

Which of the following transaction

does not affect the balance sheet total?

a. Withdrawal of P5,000 by the firm’s owner

b. Collecting P2,000 from customer’s on account
c. Purchasing P300 supplies on account
d. Paying P1,500 Notes Payable
Question #10

Which of the following errors will be

detected when a trial balance is properly
prepared?
a. Amount that was entered in the wrong account
b. A transaction that was entered twice
c. A transaction that had been ommitted
d. None of the Above
Question #1

Sometimes termed dormant partner:

a. Limited Partner b. Secret Partner
c. Capitalist Partner d. None of the Above
Question #2

A partner whose connection is

concealed and has no voice nor say in the
management of the affair of the
partnership is called
a. Nominal Partner
b. Secret Partner
c. Silent Partner
d. Dormant Partner
Question #3

Who has a priority over partnership

assets:

a. Debtors b. Partners
c. Creditors d. All of the Above
Question #4

A person who, although not actually a

partner, is made liable for the debts of the
partnership to third person by reason of
his acts or omissions is called:
a. Ostensible Partner
b. Nominal Partner
c. Silent Partner
d. None of the above
Question #5

The required minimum authorized capital

stock for stock corporation is:

a. Not less than P5,000

b. 25% must be subscribed and 25% must
be paid
c.At least 25% must be subscribed and at
least 25% must be paid and in no case shall
it be less than P5,000
d. None
Question #6

When shares with par value are

sold, the proceeds shall be credited to
the
a. Share capital account
b. Share premium
c. Retained Earnings
d. Share capital account to the extent of the
par of the shares issued with any excess
being reflected in share premium
Question #7

When shares without par value are

sold, the excess proceeds over stated value
shall be credited to

a. Income b. Retained Earnings

c. Share Premium d. Share Capital
Question #8

The total cost of treasury shares shall

be reported as
a. Deduction from shareholders’ equity
b. Asset
c. Deduction from retained earnings
d. Deduction from share premium
Question #9

An ordinary shareholder does not

possess which of the following?
a. The right to share in the earnings of the
corporation
b. The right to vote in the election of the board of
directors of the corporation
c. The right to direct ownership of the corporate
assets.
d. The right to share proportionately in corporate
assets in case of liquidation if such assets exceed
the claims of creditors
Question #10

Which of the following is not one of

the basic rights of a shareholder?

a. The right to participate in earnings

b. The right to maintain one’s proportional
interest in the corporation
c. The right to participate in the proceeds of the
sale of corporate assets upon liquidation of the
corporation.
d. The right to inspect the accounting records of
the corporation
Question #1
Red, White and Blue form a partnership
on May 1, 2008. They agreed that Red will
contribute office equipment with a total
fair value of P90,000; White will
contribute delivery equipment with a fair
value of P60,000; and Blue will contribute
cash. If Blue wants a one-third interest in
the capital and profits, he should
contibute cash of:
a. P50,000 b. P150, 000
c. P75,000 d. P225, 000
Question #2
ABC’s Partnership provided for the following
distribution of profits and losses;
“First” A to received 10% of the net income up to
P1,000,000 and 20% on the amount of excess thereof;
“Second” B & C each, are to receive 5% of the
remaining income in excess of P1,500,000 after A’s
share as per above and;
“The balance to be divided equally among the
partners.”
For the year just ended, the partnership realized
a net income of P2,500,000 before distribution to
partners. The share of A is:
a. P1,300,000 b. P1,000,000
c. P1,080,000 d. P1,100,000
Question #3

The partners, A and B share profits

3:2. However, A is to receive yearly bonus
of 20% of the profits, in addition to his
profit share. The partnership made a net
income for the year of P36,000 before the
bonus. Assuming A‘s bonus is computed
on profit after deducting said bonus, how
much profit share will B receive?
a. P 24, 800 b. P14, 400
c. P12,000 d. P13,500
Question #4

Michelle, an active partner in the

Michelle-Esme Parnership receive an
annual bonus of 25% of the partnership
income after deducting the bonus. For the
year-ended, December 31, 2008,
partnership income before the bonus
amounted to P360,000. The bonus of
Michelle for the year 2008 is:
a. P67,500 b. P72,000
c. P120,000 d. P90,000
Question #5

Arthuro Perez, a partner in the AP

Partnership, has a 25% participation in
partnership profits and losses. Perez’s capital
account has a net decrease of P80,000 during
the calendar year 2008. During 2008, Perez
withdrew P160,000 (charge against his capital
account) and contibuted property valued at
P30,000 to the partnership. What was the net
income of the AP Partnership for 2008?

a. P200,000 b. P320,000
c. P 520,000 d.P840, 000
Question #6

A, B and C are partners of A Co. By

contributing P10,000; P20,000 and services,
respectively, to the capital. After 5 years, the assets of
the partnership is only P9,000. the share of C in the
remaining asset is:
a. Equal to the share of A
b. Equal to the share of B
c. P3,000
d. Nothing
Question #7
Abe, Bert and Carl are partners sharing profit on a 7:2:1
ratio. On January 1, 2010, Dave was admitted into the
partnership with 15% share in profits. The old partners continue
to participate in profits in their original ratios.
For the year 2010, the partnership showed a profit of
P15,000. However, it was discovered that the following items
were omitted in the firm’s book:
2009 2010
Accrued expense p 1,050
Accrued income 875
Prepaid expenses P 1,400
Unearned income 1,225

The share of partner Bert in the 2010 net profit is:

a. P2,197.50 b. P2,490.50
c. P 2,637.00 d. P 3,149.75
Question #8
X, Y, and Z are partners, with X
contributing P60,000; Y P40,000; and Z
service. They agreed to divide the profits and
losses in the following proportions: X 35%; Y
25%; Z 40%. If the partnership incurred a loss
of P10,000, how should that loss be shared by
the partners?
X Y Z
a. 6,000 4,000 -0-
b. 3,500 2,500 4,000
c. 5,000 3,500 2,000
d. 4,500 3,000 2,500
Question #9

A corporation is being organized with

an authorized capital stock of P50,000.
How much thereof should be subscribed
and how much be actually paid??

Amount subscribed Amount Paid

a. 12,500 3,125
b. 10,000 2,500
c. 12,500 5,000
d. 25,000 6,250
Question #10

Which of the following conditions

will allow corporate formation and allow
securities and exchange registration?

Authorized Capital Subscribed Capital Paid-in capital

a. 200,000 50,000 9,500
b. 50,000 12,000 5,000
C. 100,000 49, 000 12, 000
d. 60,000 15,000 6,000