PART 1: REVIEWER#5: MIDTERM QUIZ 9FUNDAMENTALS OF ACCOUNTING 1 & 2)

A retailer purchases merchandise with a catalog list price of P15,000. The retailer receives a 15% trade
discount and credit items of 2/10, n/30. How much cash will needed to pay this invoice within the
discount period?

a. P15,000
b. P14,700
c. P12,750
d. P12,495

The following data for Keeper Co. taken from the ledger after adjustment on December 31, 2010 the
end of fiscal year.

Accounts Payable 97,000

Accounts Receivable 64,300
Accumulated Depreciation – Office Equipment 72,750
Accumulated Depreciation – Store Equipment 162,100
Administrative Expenses 56,500
Maeve Keeper, Capital 81,750
Cash 53,000
Cost of Merchandise Sold 121,700
Maeve Keeper, Drawing 52,000
Interest Expense 12,000
Merchandise Inventory 93,250
Note Payable, Due 2012 154,000
Office Equipment 149,750
Prepaid Insurance 6,500
Rent Revenue 17,500
Salaries Payable 28,700
Sales(net) 365,500
Selling Expenses 41,500
Store Equipment 325,000
Supplies 4,000

46. What was the net income?

a. 151,300
b. 152,500
c. 154,400
d. 153,100

47. What is the Capital December 31, 2010?

a. 180,100
b. 181,050
c. 185,080
 d. 180,850
48. What is the total assets?
a. 490,500
b. 450,900
c. 460,950
d. 409,900

The following data were extracted from the accounting records of Merid Designs for the year ended
March 31, 2011.
Merchandise Inventory, April 1, 2010 530,000
Merchandise Inventory, March 31, 2011 325,000
Purchases 230,000
Purchase Returns and Allowances 25,000
Purchase Discounts 10,000
Sales 820,000
Sales Returns 20,000
Freight In 3,000

49. Determine the Gross Profit?

a. 379,000
b. 793,000
c. 973,000
d. 397,000

For each of the following, calculate the cost of inventory reported on the balance sheet. For items 50 to
52 choose the answer below:

a. 75,000
b. 69,000
c. 62,000
d. 59,000

50. The total merchandise on hand at the end of the year as determined by taking a physical inventory id
P62,000, P8,000 has been sol FOB destination and is awaiting pickup by the carrier.
ANSWER: C

51. The total merchandise inventory counted at the end of the year was P63,000. Purchases for P6,000
are in transit under FOB shipping point terms.
ANSWER: B

REVIEWER #6: QUIZ NI LAW FUNDAMENTAL OF ACCTNG 1 & 2

22. Anne, Bea and Cass from a partnership on January 1, 2010. They agree that Ann will contribute office
equipment with a total fair value of P40,000; Bea will contribute deliver equipment with a fair value of
P80,000 and Cass will contribute cash. If Cass wants a one third interest in the capital and profits, he
should contribute the following cash:
a. 50,000
b. 40,000
c. 65,000
d. 60,000

23. When a partnership is formed, assets contributed by the partners should be recorded on the
partnership book at their,
a. Book values on the partner’s book prior to their being contributed to the partnership
b. Assessed values for property purposes
c. Fair value at the time of the contribution
d. Original costs to the partner contributing them

24. Henry Jones contributed equipment, inventory, and P44,000 cash to the partnership. The equipment
had a book value of P35,000 and market value of P28,000. The inventory has a book value pf P25,000,
but only has a market value of P12,000 due to obsolescence. The partnership also assumed a P15,000
note payable owned by Henry that was originally used to purchase the equipment. What amount should
Henry’s capital account be recorded?
a. 104,000
b. 89,000
c. 69,000
d. 84,000

REVIEWER #7: FAR PRELIM EXAMINATION

24. On December 31, 2036, Marlon Company had the following balances in the accounts it maintains at
First State Bank:

Checking account #101 1,750,000

Checking account #201 (100,000)
Time Deposit 250,000
Commercial Papers 1,000,000
90-dat treasury bill, die February 28, 2037 500,000
80-dat treasury bill, die March 15, 2037 800,000

The entity classifies investments with original maturities of three months of less as cash equivalents. In
the December 31, 2036 statement of financial position, what total amount should be reported as cash
and cash equivalents?
a. 3,400,000
b. 2,000,000
c. 2,400,000
d. 3,200,000
25. The following information pertains to Bustos Company as of December 31, 2031:

Cash balance per general ledger 15,000,000

Cash balance per bank statement 14,550,000
Checks Outstanding (including certified check of P100,000) 1,000,000
Bank service charge shown in December bank statement 50,000
Error made by Bustos on recording a check that cleared the bank in
December (check was drawn in December for P500,000 but
recorded at P700,000) 200,000
Deposit in transit 1,500,000

At the December 31, 2031, the cash om bank that should be reported is
a. 15,150,000
b. 14,650,000
c. 14,250,000
d. 14,550,000

26. Under which section of the statement of financial position is “cash restricted for plant expansion”
reported?
a. Current Assets
b. Non-current Assets
c. Current liabilities
d. Equity

27. Bank overdrafts, if material, should

a. Be reported as a deduction from the current asset section.
b. Be reported as a deduction from the cash
c. Be netted against cash and a net cash amount reported
d. Be reported as a current liability

REVIEWER #8: FAR MIDTERM EXAMINATION

24. If the cash balance in an entity ‘s bank statement is less that the correct cash balance and neither the
entity nor the bank has made any errors, there must be
a. Deposits credited by the bank but not yet recorded by the entity
b. Outstanding checks
c. Bank charges not yet recorded by the entity
d. Deposits in transit

25. A bank reconciliation is

a. A formal financial statement that lists all of the bank account balance of an enterprise.
b. A merger of two banks that previously were competitors
c. A statement sent by the bank to depositor on a monthly basis
 d. A schedule that accounts for the differences between an entity’s cash balance as shown on its
bank statement and the cash balance shown in its general ledger.

XYZ Company had the following bank reconciliation on June 30, 2020:
Balance per bank statement, June 30 3,000,000
Deposit in transit 400,000
Total 3,400,000
Outstanding checks (900,000)
Balance per book, June 30 2,500,000

The bank statement for the month of July showed the following:
Deposits (including P200,000 note collected for XYZ Company) 9,000,000
Disbursements (including P140,000 NSF check and P10,000
service charge 7,000,000

All reconciling items on June 30 cleared through the bank in July. The Deposit in transit amounted to
P1,000,000 and the outstanding checks totaled P600,000 on July 31.

26. What is the cash in the bank to be reported on July 31, 2020?
a. 5,000,000
b. 4,600,000
c. 5,400,000
d. 4,900,000

27. What is the cash in bank balance per ledger on July 31, 2020?
a. 5,400,000
b. 5,550,000
c. 5,350,000
d. 4,500,000