1.

A company reported P18,000 of net income for 2016, P24,000 for 2017, and P26,000 for
2018. The percentage change in net income from 2017 to 2018 was:
a. 20.00%
b. 30.00%
c. 10.00%
d. 8.33%

2. A company had a balance in the Accounts Receivable account of P780,000 at the beginning
of the year and a balance of P820,000 at the end of the year. Net credit sales during the year
amounted to P5,840,000. The average collection period of the receivables in terms of days was
a. 30 days
b. 365 days
c. 100 days
d 50 days

3. Cliff Company reported the following on its income statement:

Income before income taxes P420,000
Income tax expense 120,000
Net Income P300,000
An analysis of the income statement revealed that interest expense was P80,000. The
company’s times-interest-earned ratio was
a. 8 times
b. 5.25 times
c. 6.25 times
d. 5 times

4. Net sales are P1,500,000, beginning total assets are P700,000 and the asset turnover is 3.0.
What is the ending total asset balance?
a. P500,000
b. P300,000
c. P700,000
d. P400,000

5. A company has the following balance sheet information in ‘000:

 Current Assets P4,000
Current Liabilities 1,000
Long term Assets 8,000
Long term Liabilities 2,000
Common Stock 4,000
Retained Earnings 5,000

There was no interest expense and no dividends declared. What is the debt/equity ratio at
year-end?
a. 400%
b. 75%
c. 300%
d. 33%

6. Financial records of a company reveal the following:

Net Sales P180,000
Cost of good sold 120,000
Ending Inventory 25,000
Beginning Inventory 35,000

Assuming a 360-day year, what was the average days to sell inventory?
a. 60 days
b. 75 days
c. 70 days
d. 90 days

7. Assume liabilities total P25,000 average common stockholders’ equity total P80,000;
expenses total P43,000 and return n common stockholders’ equity is 12%. Total revenues for
the period is;
a. P9,600
 b. P52,600
c. P33,400
d. P77,600
8. The company’s net accounts receivable were P500,000 at December 31, 2016 and P60,000 at
December 31, 2017. Net cash for 2017 were P200,000. The accounts receivable turnover for
2017 was 5.0. What was the company’s net sales for 2021?
a. P2,950,000
b. P3,200,000
c. P3,000,000
d. P5,500,000

9. Gottlob Corporation’s most recent income statement appears below:

Sales (all on account) P824,000
Cost of good sold 477,000
Gross Margin P347,000
Selling and administrative expense 208,000
Net operating income P139,000
Interest expense 37,000
Net income before taxes P102,000
Income taxes 30,000
Net income P72,000

The profit margin percentage is closest to

a. 8.74%
b. 12,4%
c. 16,9%
d. 42.1%

10. During 2017, Dumapias Company purchased P900,000 of inventory. The cost of good sold
for 2017 was P960,000, and the inventory on December 31, 2016 was P180,000. What was the
inventory turnover for 2017?
a. 5.0 times
 b. 5.3 times
c. 6.0 times
d. 6.4 times

11. The times interest earned ratio of Chikel Company is 5.5 times. The interest expense for the
year was P20,000 and the company’s tax rate is P40%. The company’s net income is
a. P22,000
b. P42,000
c. P54,000
d. P66,000

12. Crandall Company’s net income last year was P60,000. The company paid preferred
dividens of P10,000 and its average common stockholders’ equity was P480,000. The
company’s return of common stockholders’ equity for the year was closet to
a. 2.1%
b. 10.4%
c. 12.5%
d. 14.6%

13. Cedric Corp has a current ratio of 2.6 to 1. The minimum desired ratio is 5 to 1. At present,
the net working capital is P40,000. How much current liabilities must be paid to achive the
minimum current ratio?
a. P10,000
b. P15,000
c. P20,000
d. P25,000

14. Arnston Corporation’s net income last year was P7,975,000. The dividend on common stock
was P8.20 per share and the dividend on preferred stock was P3.50 per share. The market price
of common stock at the end of the year was P59.10 per share. Throughout the year, 500,000
shares of common stock and 200,000 shares of preferred stock were outstanding. The dividend
payout ratio is closets to
a. 0.139
b. 0.246
c. 0.514
d. 0.564