FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND

MANAGEMENT 2
(Q1 Module 1 Statement of Financial Position)
Name of Learner: _______________________________ Section:_____________
PART I: Multiple Choice: Read and analyze each item and choose the best answer and write it in
the space provided. CAPITAL LETTER ONLY.

___1. Which of the following is not recorded in the SFP?

A. Assets B. Equity C. Liabilities D. Revenues
___2. Which of the following assets is NOT a current asset?
A. Cash B. Equipment C. Inventories D. Receivables
___3. What are the resources or things value owned by an enterprise?
A. Assets B. Equity C. Expenses D. Liabilities
___4. What do you call the transferring of cost of asset to expense?
A. Allowance for Bad debts C. Accumulated Depreciation
B. Accounts Payable D. Accrued Interest Payable
___5. What is a Current Assets?
A. It is cash or cash equivalent which is not restricted for current use.
B. It is expected not to be realized, or is held for sale or consumption in the normal course of
the business operating cycle.
C. It is held primarily for trading purposes or for the long term, and it is expected to be
realized more than twelve months of the SFP date.
D. It is expected to be settled in the normal course of the business operating cycle.
___6. What is a contra-validation account that refers to the amount estimated uncollectible?
A. Accounts Payable C. Allowance for Bad Debts
B. Accrued Interest Payable D. Accumulated Depreciation
___7. Which of the following is an example of noncurrent liability?
A. Accrued Expenses B. Deferred Income C. Loans Payable D. Short-term Liabilities
___8. What accounts are reported in the SFP?
A. Assets B. Equity C. Liability D.Revenue
___9. What are these various materials which remain unused at the end of the accounting period?
A. Accounts Receivable B. Accounts Payable C. Prepaid Supplies D. Withdrawal Account
___10. What pro forma of the SFP that presents its elements in horizontal order following the
accounting equation?
A. Account Form B. Direct Method C. Indirect Method D. Report Form
___11. A promissory note issued by the business to its creditors for money borrowed or merchandise
and other assets bought on credit. What example of current liability it is?
A. Accounts Payable B. Accrued Interest Payable C. Notes Payable D. Premium Payable
___12. Which of the following compromises the portion payable beyond one year of a long term
liability?
A. Assets B. Current Liability C. Equity D. Noncurrent Liability
___13. What plant asset is NOT subject to depreciation?
A. Building B. Equipment C. Land D. Land Improvements
___14. Which of the following is NOT reported in the SFP?
A. Accrued Interest B. Accumulated Depreciation C. Bad Debt Expense D. Owner’s Drawings
___15. Which of the following is NOT a current asset?
A. Accounts Receivable B. Cash C. Equipment D. Inventories
PART II
Comprehensive Problem: Wedding “R” Us
Accounts Payable 53, 000
Accounts Receivable 17, 300
Accumulated Depreciation – Office Equipment 1, 000
Accumulated Depreciation – Service Vehicle 4,000
Cash 22, 200
Consulting Revenues 67, 700
Diaz, Capital 250, 000
Diaz, Withdrawal 14, 000
Depreciation Expense – Service Vehicle 4, 000
Depreciation Expense – Office Equipment 1, 000
Interest Payable 3, 500
Insurance Expense 1, 200
Interest Expense 3, 500
Notes Payable 210, 000
Office Equipment 60, 000
Prepaid Rent 4, 000
Prepaid Insurance 13, 200
Referral Revenues 4, 000
Rent Expense 4, 000
Supplies 15, 000
Service Vehicle 420,000
Salaries Payable 1, 800
Salaries Expense 15, 600
Supplies Expense 3, 000
Utilities Expense 4, 400
Utilities Payable 1, 400
Unearned Referral Revenues 6, 000