9/20/21, 1:36 PM Long Quiz 002

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Week 8 and 9: Cash Flow Statement /
Long Quiz 002

Question 1
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Net sales is P450,000, sales discounts is P35,000, and sales returns and allowances is P15,000. Compute for the gross sales.

Select one:
a. Cannot be determined from the given data
b. P430,000
c. P400,000
d. P500,000
Clear my choice

Question 2
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Gross profit is P150,000, total selling expenses is P39,000, and total general and administrative expenses cost P52,000. Compute for the
operating income.

Select one:
a. P163,000
b. Cannot be determined from the given data
c. P59,000
d. P241,000

Clear my choice

Question 3
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A form of business organization whose statement of income does not include sales.

Select one:
a. merchandising business
b. service business
Clear my choice

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9/20/21, 1:36 PM Long Quiz 002

Question 4
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It relies entirely on the payment and receipt of cash.

Select one:
a. All of the choices
b. Accrual basis of accounting
c. Cash basis of accounting
d. Financing activities

Clear my choice

Question 5
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The ________________represents the total capital at the start of the business.

Select one:
a. investment
b. net profit
c. Ending capital
d. Beginning capital
Clear my choice

Question 6
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Accrual basis of accounting is a basic accounting principle that states that income is earned regardless of when cash is received, and
expenses are incurred regardless of when cash is paid

Select one:
True

False

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9/20/21, 1:36 PM Long Quiz 002

Question 7
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The heading of a statement of income usually consists of the following except:

Select one:
a. None of the choices
b. Statement of Income
c. Period covered by the statement
d. Business Name

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Question 8
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If the firm has been operating in the past year, the beginning capital of the current year is _____________ the ending capital of the previous
year.

Select one:
a. Equal to
b. Different
c. The same
d. None of the choices
Clear my choice

Question 9
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Cash flows are categorized into three types: operating, investing, and financing activities.

Select one:
True

False

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Question 10
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The income statement for merchandising businesses usually has eight sections: Net sales, Cost of goods sold, Gross profit, Operating
expenses, Operating income or operating loss, Other revenues and gains (expenses and losses), Net profit or net loss.

Select one:
True

False

Question 11
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Revenues of a service business is synonymous to the following except:

Select one:
a. service income
b. Sales
c. commission income
d. Professional fees

Clear my choice

Question 12
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In cash basis accounting, income shall only be recognized when cash is received, and expenses shall only be recorded when cash is paid.

Select one:
True

False

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9/20/21, 1:36 PM Long Quiz 002

Question 13
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If the firm has been operating in the past year, the beginning capital of the current year is _____________ the ending capital of the previous
year.

Select one:
a. The same
b. Different
c. Equal to
d. None of the choices

Clear my choice

Question 14
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It is a basic accounting principle that states that income shall only be recognized when cash is received, and expenses shall only be recorded
when cash is paid.

Select one:
a. Accrual Basis of accounting
b. None of the choices
c. Cash Basis of accounting
d. Both A and B
Clear my choice

Question 15
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Operating activities are those primarily involve cash received from customers and paid to suppliers, lenders, or employees.

Select one:
True

False

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Question 16
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Income of a merchandising business comes from _________________.

Select one:
a. Rendered Services
b. Both A and B
c. None of the choices
d. Sales of the product

Clear my choice

Question 17
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We could find the period covered by the statement at the ________________ of the statement of the account.

Select one:
a. None of the choices
b. Heading
c. Body
d. Both A and B
Clear my choice

Question 18
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The equation for cost of goods sold is:

Select one:
a. Beginning inventory - Net cost of goods purchased - Ending inventory
b. Beginning inventory + Net cost of goods purchased + Ending inventory. {
c. None of the choices
d. Beginning inventory + Net cost of goods purchased - Ending inventory

Clear my choice

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9/20/21, 1:36 PM Long Quiz 002

Question 19
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It is a Financial Statement that focuses on the residual interest of the owner in the business.

Select one:
a. Statement of Financial Position
b. Statement of Changes in Equity
c. Statement of Income
d. All of the choices

Clear my choice

Question 20
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The owner's equity is also called capital, net assets, or net worth.

Select one:
True

False

◄ Week 008-009 - Module Cash Flow Statement

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