Professional Documents
Culture Documents
3. They encompass the conventions, rules, and procedures necessary to define what is accepted
accounting practice.
a. Accounting Assumptions
b. Accounting Concepts
c. Conceptual Frameworks
d. Generally Accepted Accounting Principles or GAAP
4. Which of the following entries records the receipt of a utility bill from the water company?
a. debit Accounts Payable, credit Cash
b. debit Accounts Payable, credit Utilities Payable
c. debit Utilities Expense, credit Accounts Payable
d. debit Utilities Payable, credit Accounts Receivable
9. Which financial statement reports the revenues and expenses for a period of time such as a
year or a month?
a. Balance Sheet
b. Income Statement
c. Statement of Cash Flows
d. None of these
11. The first financial statement that is prepared from the trial balance is the
a. statement of cash flows.
b. statement of cash flows.
c. income statement.
d. balance sheet.
13. On Apr. 1, 2023,Wenn sets up a firm and brings in office equipment of P50,000 and inventory
of P30,000 to the business. Wenn puts P80,000 into the firm's cash box and P100,000 into the
firm's bank account. Meanwhile, the firm lends P50,000 cash to RD and Associates and
borrows P200,000 from the bank to acquire a piece of premises.
a. 510,000
b. 206,000
c. 260,000
d. 216,000
14. Under the double-entry system, what is the value of X assets, current liabilities, non-current
liabilities and capital are X P40,000, P60,000 and P350,000 respectively?
a. 250,000
b. 350,000
c. 370,000
d. 450,000
15. A business has the following items in it:
- Land P 100,000
- Machinery 20,000
- Cash 10,000
- Debt 30,000
- Owner’s equity ______?
What is the value of the owner’s equity?
a. 100,000
b. 160,000
c. 60,000
d. 130,000
16. A debtor repays his debt of P50,000 by transferring the money into bank account of the
business The effect of the transaction on the accounting equation would be:
a. Both assets and liabilities increase by P50,000
b. Both assets and liabilities decrease by P50,000
c. Only assets decrease by P50,000
d. Assets and liabilities remain unchanged.
17. At the beginning of the year, the assets of Alice in Wonderland Services were P360, 000 and
its owner's equity was P200,000. During the year, assets increased by P120,000 and liabilities
increased by P20,000. What was the owner's equity at the end of the year?
a. 300,000
b. 460,000
c. 480,000
d. 320,000
19. At the beginning of the year, MJ Calling Station had liabilities of P100,000 and owner's equity
of P96,000. If assets increased by P40,000 and liabilities decreased by P30,000, what was the
owner's equity at the end of the year?
a. 136,000
b. 126,000
c. 110,000
d. 166,000
20. The liabilities of Belle Stylist equal one-third of the total assets, and the owner's equity is
P240,000. What is the amount of the liabilities?
a. 80,000
b. 120,000
c. 160,000
d. 240,000