1.

If furniture is overvalued by P 1,000 in the trial d) Account Title

balance, ________.
a) The total debit balance is the same as the total
credit balance in the trial balance.
b) None of the choices
c) The value of assets on the credit side of the
trial balance should be reduced.
d) Total debit balance is less than the total credit
balance in the trial balance.
e) Total debit balance is greater than total credit
balance in the trial balance.
e) None of the choices
4. Which of the following elements does not actually
relate to financial position?
a) Amount owed to creditors
b) Net interest in the company of the owners
c) Increases in equity other than investments
d) Resources of the company
e) None of the choices

2. If accounts payable is undervalued by P 3,000 in 5. Which of the following accounts is commonly

the trial balance, _______. classified as current?
a) Total debit balance is less than the total credit a) Accumulated Depreciation
balance in the trial balance. b) Mortgage Payable
b) The value of liability on the credit side of the c) Intangible Assets
trial balance should be reduced. d) Equity
c) Total debit balance is greater than total credit e) None of the choices
balance in the trial balance.
d) The total debit balance is the same as the total
credit balance in the trial balance. 6. Which of the following elements properly relate to
e) None of the choices financial performance?
a) Either Income or Expense
b) Income
3. Complete the statement: ________ shows the c) Both Expense and Income
changes in the balance and the ending balance of d) Expense
elements of financial statements. e) None of the choices
a) T- Account
b) Accounting Equation
c) Double- Entry System 7. Which of these steps is executed during the
accounting period?
 a) Reversing entries preparation
b) Preparation of worksheet
c) Journalizing and posting adjusting entries
d) Analyzing transactions
e) None of the choices
8. Which of these steps is executed at the end of the
accounting period?
a) Both preparation of financial statements, and
journalizing and posting of daily entries
b) Either preparation of financial statements or
journalizing and posting of daily entries
c) Preparation of financial statements
d) Journalizing and posting of daily entries
e) None of the choices
9. Which of the following properly depicts the points
considered in analyzing a business transaction?
a) Identify the incorrect side to reflect the effect of
transaction to indicated accounts
b) Ascertain the effect of the indicated accounts to
the transaction
c) Indicate the accounts not affected by the
transaction
d) Two of these properly depict the points
considered in analyzing a business transaction
e) Identify the transaction based on document
presented
10. Which of the following is not a part of a
journal?
a) Date Column
b) Account titles and explanation column
c) Debit amount column
d) Pre-referencing column
e) None of these because all of these are parts of
a journal
11. Analyze the set of statements:
I –The balance seen in the accounting equation is
observed in most cases of business transactions.
II – A decrease in asset is not a debit.
III – Analyzing business transactions is done
during the period.
Given these statements, we can say that:
a) Most of the statements are false.
b) Most of the statements are true.
c) All of these statements are true.
d) All of these statements are false.
e) None of the choices
12. Analyze the set of statements:
I – The normal balance of an account, regardless
of its classification, is not the side where increases
are not recorded.
II – Notes payable is usually a current asset.
III – An increase in income is not a credit.
Given these statements, we can say that:
 a) Only statement II is true.
b) Most of the statements are true.
c) All statements are not true.
d) Only statement III is false.
e) Statement II is false.
13. Tom Jones is the owner and operator of
Jones Enterprise, a motivational consulting
business. At the end of its accounting period,
December 31, 2019, Jones Enterprise has assets
of P760,000 and liabilities of P240,000.
Tom Jones, capital, as of December 31, 2019?
a) P250,000
b) P520,000
c) P560,000
d) P960,000
14. Tom Jones is the owner and operator of
Jones Enterprise, a motivational consulting
business. At the end of its accounting period,
December 31, 2019, Jones Enterprise has assets
of P760,000 and liabilities of P240,000
Tom Jones, capital, as of December 31, 2020,
assuming that assets increased by P120,000 and
liabilities increased by P72,000 during 2020?
a) P520,000
b) P568,000
c) P586,000
d) P880,000
15. Tom Jones is the owner and operator of
Jones Enterprise, a motivational consulting
business. At the end of its accounting period,
December 31, 2019, Jones Enterprise has assets
of P760,000 and liabilities of P240,000.
Tom Jones, capital, as of December 31, 2020,
assuming that assets decreased by P60,000 and
liabilities increased by P21,600 during 2020?
a) P478,400
b) P438,400
c) P520,400
d) P568,400
16. Tom Jones is the owner and operator of
Jones Enterprise, a motivational consulting
business. At the end of its accounting period,
December 31, 2019, Jones Enterprise has assets
of P760,000 and liabilities of P240,000
Tom Jones, capital, as of December 31, 2020,
assuming that assets increased by P100,000 and
liabilities decreased to P38,400 during 2020?
a) P438,400
b) P821,600
c) P658,400
d) P539,600
17. Indicate the effect of transaction. Choose a) Increase asset and decrease another asset
the letter that corresponds to the effect. b) Increase asset and increase liability
c) Decrease assets and decrease owner’s equity
Elizabeth Salvador Freight Services during July d) Increase assets and increase Owner’s equity
2020:

"Cash received from delivery services"
a) Increase asset and decrease another asset
b) Increase asset and increase liability
c) Decrease assets and decrease owner’s equity
d) Increase assets and increase Owner’s equity
20. Indicate the effect of the transaction.
Choose the letter that corresponds to the effect.
Elizabeth Salvador Freight Services during July
2020:

18. It is a decrease in economic benefit during "Paid advertising expense"

the acctg period related to a decrease in asset or a) Increase asset and decrease another asset
an increase in liability that results in decrease in b) Increase asset and increase liability
c) Decrease assets and decrease owner’s equity
equity other than distribution to owners.
d) Increase assets and increase Owner’s equity
a) Liability
b) Asset
c) Income
d) Expense

19. Indicate the effect of the transaction.

Choose the letter that corresponds to the effect.

Elizabeth Salvador Freight Services during July

2020:

"Received cash from the additional investment of

the owners"