1.

Which of the following is not a

step in the accounting process?
a.Identification
b.Communication
c.Recording
d.Verification
2. Which of the following is not a
relevant economic event?
a. An agent who attended to the concern of
complaining customer.
b. Youseff, manager of Company X, who
sold an abandoned building of his
company.
c. Company Y which borrowed ₱5M from a
bank due to tight financial conditions.
d. Company Z which paid its employees
their salaries for the month of January.
3. Which of the following does not show one
of main functions of accounting?
a. Fred prepared a report to be submitted to the
taxing authorities.
b. John recorded the purchase of an equipment
in the accounting books immediately after
purchase.
c. Jason prepares financial reports monthly for
the company’s stakeholders.
d. Allen canvassed the price of a sewing machine
to be used in the company’s operations.
4. Which of the following statements
describes the accounting process?
a. It involves identifying relevant economic
events.
b. Recording economic events is an essential part
of the accounting process.
c. The accounting process is not complete if the
financial information is not communicated to
interested users.
d. All of the above
5. Which is the most important
step in the accounting process?
a. Identification
b. Recording
c. Communication
d. All steps are equally important
6. Who is considered as the
father of modern accounting?
a. Queen Victoria
b. Luca Pacioli
c. Leonardo Da Vinci
d. Augustus
7. Which nature of accounting best
emphasizes that accounting is not
the objective?
a. Accounting is an art.
b. Accounting deals with financial
information and transactions.
c. Accounting is a means not an end.
d. Accounting is a process.
8. Yanichel, the chief accountant of Company
X, is preparing for a meeting with the top
management. This meeting is done
monthly to evaluate the performance of
the company. Which step of the accounting
process is most likely being done?
a. Recording
b. Communicating
c. Identification
d. Classification
9. What profession does not use
accounting information at all?
a. Entrepreneurs
b. Economists
c. Government officials
d. None of the above
10. Which of the following is false?
a. The accounting process consists of identifying
economic events, recording these events, and
communicating these events to external users only.
b. The accounting process consists of identifying
economic events, recording these events, and
communicating these events to internal and
external users.
c. The accounting process consists of identifying
economic events, recording these events, and
communicating these events to internal users only.
d. a and c only
11. Which of the following can be considered
as a relevant economic event?
a. A meeting of the top management was held
in the discussion room last month.
b. The company received advance payments
from its customers.
c. OMECO announced that it will increase
energy prices by the end of the month.
d. GMA Network signed a contract with
Dingdong Dantes.
12. One of the differences of financial
accounting from management accounting is?
a. Financial accounting are beneficial to external
users only.
b. Financial accounting can be used by internal
users only.
c. Financial accounting produces reports known as
the financial statements.
d. Financial accounting, unlike management
accounting, primarily aims to help managers in
their decision-making.
13.Information produced by this
branch of accounting aims to
educate students in the field of
accountancy.
a. Accounting Education
b. Accounting Research
c. Financial Accounting
d. Management Accounting
14. Which of the following is/are characteristics of
accounting research?
I. The main goal is the continuous improvement of the field
of accountancy
II. It gives credibility to the company’s financial statements.
III. The frequency of reporting varies.
IV. The primary users of the information are the taxing
authorities.
a. I only
b. II and III only
c. I and III only
d. I, II and III only
15.Which among the following is not
considered an internal user of
accounting information?
a. Owners of a business
b. Senior partners of an audit frim
c. Suppliers
d. Field workers
16.Which of the following is not
considered an external user
of accounting information?
a. BIR officials
b. Customers
c. Production supervisor
d. A student of accountancy
17.This group of users of accounting
information invested resources to
the company with hopes of
earning acceptable returns.
a. Creditors
b. Government
c. Potential investors
d. Owners of stockholders
18. Which of the following statements about external
users of accounting information is correct?
a. External users of accounting information include the
employees of a company.
b. External users of accounting information do not have the
capability to acquire information directly from the
company.
c. The needs of the external users of accounting information
are always prioritized over those of internal users.
d. External users of accounting information are not
concerned with the amount of borrowings of a company.
19.Which of the following is not an
internal user of accounting
information?
a. Production Supervisor
b. Ramelyn, an employee who granted a
loan to the company
c. Alisha, a financial analyst trying to find
the value of a business
d. Chief Operating Officer
20.These internal users of
accounting information are
viewed as the brains of the
company.
a. Management
b. Employees
c. Owners or Stockholders
d. Board of Directors
21.A corporation can extend its
life for a period not exceeding
a. 40 years
b. 45 years
c. 50 years
d. 60 years
22.A cooperative can be established for
the following purposes, except
a. To develop expertise and skill among its
members
b. To provide services for charitable
purposes
c. To insure against losses of the members
d. To promote and advance the economic,
social, and educational status of the
members
23.All of the following are advantages of
a sole proprietorship, except
a. The owner has full control of the
business.
b. All the profits of the business belong to
the owner.
c. A sole proprietorship can operate under
fictitious or trade names.
d. Taxation of sole proprietorship is simple.
24.At least how many persons
are required to form a
cooperative?
a. 10 persons
b. 15 persons
c. 20 persons
d. 5 persons
25.Taken collectively, this form of
business organization generates
the higher level of income.
a. Sole proprietorships
b. Partnerships
c. Corporations
d. Cooperatives