OFAD6005 - Introduction to Basic Accounting
Financial accounting focuses on the needs of internal users like creditors and government for financial information.
Select one:
True
False
Accounting is the information system that measures business transactions, process information into reports, and
communicate the results to decision makers.
Select one:
True
False
It is the branch of accounting that stem from the manufacturing type of business.
Select one:
a.
Management Accounting
b.
Tax Accounting
c.
Auditing
d.
Cost Accounting
Primary users of financial information includes owners, employees, and managers.
Select one:
True
False
To meet the objectives of the accountancy profession to work to the highest standards and attain the highest level
of performance, the following are required except
Select one:
a.
Quality of services
b.
Credibility
c.
Subjectivity
d.
Professionalism
Public accountants are those who rendered services to the general public in exchange of professional fees. They
should pass the licensure examination given by
Select one:
a.
Securities and Exchange Commission
b.
Board of Accountancy
c.
Philippine Institute of Certified Public Accountants
d.
Professional Regulation Commission
Management accounting is the branch of accounting that concentrates on the information needed by external
users.
Select one:
True
False
Private accountants can perform these services to the firm where they work except
Select one:
a.
Budgeting
b.
Internal auditing
c.
Consultancy
d.
Cost accounting
The accounting concept that requires that the revenues and expenses should be recognized in the accounting
period when they are actually earned and incurred is called conservatism principle.
Select one:
True
False
Primary users of financial accounting information include the following except
Select one:
a.
Owners
b.
Managers
c.
Prospective investors
d.
Employees
A professional accountant should be fair and should not allow biases, conflict of interest, or influence other people
in the performance of their functions.
Select one:
a.
Private Accountants
b.
Human Resource Accounting
c.
Objectivity
d.
PICPA
Accountants rendering services in exchange of professional fees.
Select one:
a.
Public Accountants
b.
Economic Entity Principle
c.
Monetary Unit Principle
d.
Accrual Principle
Branch of accounting for government and not-for-profit organizations.
Select one:
a.
Internal Users
b.
Financial Accounting
c.
Fund Accounting
d.
External users
Accountants performing consultancy, auditing, and tax services.
Select one:
a.
National Accounting
b.
Major Branches of Accounting
c.
Duality Principle
d.
Public Accountants
Creditors, potential investors, consumers
Select one:
a.
Fund Accounting
b.
External users
c.
Internal Users
d.
Financial Accounting
Their services include budgeting, general accounting and internal auditing in a firm.
Select one:
a.
Private Accountants
b.
PICPA
c.
Objectivity
d.
Human Resource Accounting
Recording business transactions, Classifying, Summarizing, and interpreting the results.
Select one:
a.
Phases of Accounting
b.
Integrity
c.
Major Branches of Accounting
d.
Duality Principle
The inventor of double-entry system.
Select one:
a.
Luca Pacioli
b.
Napoleon Bonaparte
c.
Jacques Savary
d.
Amanito Manucci
The principle referring to the application of the rules of debit and credit.
Select one:
a.
Major Branches of Accounting
b.
Integrity
c.
Duality Principle
d.
Phases of Accounting
A principle that requires accountants to be honest and straightforward in performing professional services.
Select one:
a.
Duality Principle
b.
Major Branches of Accounting
c.
Integrity
d.
Phases of Accounting
Payment of dividends is a financing activity.
Select one:
True
False
A business organization owned by only one person who usually manages the same.
Select one:
a.
Service concern or service type
b.
Sole proprietorship
c.
General partnership
d.
Non-stock corporation
It is a type of businesses which is also termed trading or buy and sell.
Select one:
a.
Investing activities
b.
Manufacturing
c.
Operating activities
d.
Merchandising
The ultimate goal of any business organization is profit.
Select one:
True
False
The business most liquid asset is cash.
Select one:
True
False
Selling of plant assets is what category of business activity?
Select one:
a.
Merchandising
b.
Operating activities
c.
Manufacturing
d.
Investing activities
It is a type of business whose source of revenues is mainly rendering services to customers.
Select one:
a.
General partnership
b.
Non-stock corporation
c.
Sole proprietorship
d.
Service concern or service type
Borrowing funds is a financing activity and payment of corresponding interest is an operating activity.
Select one:
True
False
In merchandising type of business, the merchandiser performs two roles-a buyer and a seller.
Select one:
True
False
Materials, labor and overhead are outputs in a manufacturing type of business.
Select one:
True
False
Which of the following statements is not true?
Select one:
a.
Toyota Corporation is a manufacturing business.
b.
None of these.
c.
A school who also sells books to their students is a merchandising type of business.
d.
Western Marketing Corporation is a merchandising type of business.
All kinds of business organization should register a business name with
Select one:
a.
None of these
b.
Bureau of Internal Revenue
c.
Securities and Exchange Commission
d.
Department of Trade and Industry
Purchase of bonds or stocks is a
Select one:
a.
All of these
b.
Investing Activity
c.
Financing Activity
d.
Operating Activity
Which of the following business organization is created under the Batas Pambansa Bilang 68?
Select one:
a.
Cooperatives
b.
Sole Proprietorship
c.
Partnership
d.
Corporation
The financial statement that presents the operating, investing, and financing activities is
Select one:
a.
Statement of Income
b.
Statement of Cash Flows
c.
Statement of Financial Position
d.
Statement of Changes in Equity
Which of the following can be a partner's contribution to the partnership?
Select one:
a.
All of these
b.
Services
c.
Money
d.
Properties
Acquisition of non-current assets is a
Select one:
a.
Financing Activity
b.
Investing Activity
c.
All of these
d.
Operating Activity
Which of the following should be registered with the Securities and Exchange Commission?
Select one:
a.
Corporation only
b.
Both Partnership and Corporation
c.
Partnership only
d.
Sole proprietor
A lawyer set up a law office for the practice of his profession. This is an example of a
Select one:
a.
Corporation
b.
Sole Proprietorship
c.
Cooperative
d.
Partnership
He has a direct and lone responsibility to the assets, liabilities, capital, even the profits and losses of the business:
Select one:
a.
Sole Proprietor
b.
Shareholder
c.
Member
d.
Partner
IT Infrastructure refers to the hardware components of AIS.
Select one:
True
False
It is generally a computer-based way of monitoring accounting activities.
Select one:
a.
Security
b.
Procedures and Instructions
c.
Accounting Information system
d.
Confidentiality
In computerized AIS, a list of selections in choosing computer functions is called tools.
Select one:
True
False
Data include billing statements, sales reports, check registers and purchase invoices.
Select one:
True
False
A well designed AIS can make changes without disturbing the whole system.
Select one:
True
False
The AIS users are referred to as the people component.
Select one:
True
False
It refers to data from different source documents.
Select one:
a.
People
b.
Computerized
c.
Menu
d.
Inputs
In computerized AIS, a list of selections in choosing computer functions is called what?
Select one:
a.
People
b.
Inputs
c.
Computerized
d.
Menu
The AIS users are referred to as what component?
Select one:
a.
Computerized
b.
People
c.
Data
d.
Information Technology Infrastructure
It is component of AIS that includes billing statements, sales reports, check registers and purchase invoices.
Select one:
a.
Computerized
b.
People
c.
Information Technology Infrastructure
d.
Data
A ___ is a list of selections of computer functions.
Select one:
a.
Internal controls
b.
Menu
c.
Computerized
d.
Control
______ processes include journalizing business transactions, posting to the ledger and preparing the financial
statements.
Select one:
a.
Inputs
b.
Outputs
c.
Manual
d.
Account numbers
AIS warrants the accurate recording and processing of financial data in accordance with the _______ principles.
Select one:
a.
Accounting
b.
Computer-based
c.
People
d.
Cost
Accounting information system is generally a _______________ approach for monitoring accounting activities
Select one:
a.
Cost
b.
Accounting
c.
Computer-based
d.
People
Procedures refer to the different approaches used in both AISs to gather, keep, retrieve, and process_____.
Select one:
a.
Confidentiality
b.
Data
c.
Software
d.
Manual AIS
The information technology infrastructure pertains to the _____ components of AIS.
Select one:
a.
Software
b.
Input
c.
Security
d.
Hardware
In a computerized accounting system, the ______ are primarily used to translate accounts and their balances to
financial reports.
Select one:
a.
Manual
b.
Account numbers
c.
Inputs
d.
Outputs
_____________ of AIS pertains to the security measures that will protect sensitive data.
Select one:
a.
Control
b.
Computerized
c.
Internal controls
d.
Menu
The hardware should be compatible with the _____for better speed and storage capabilities.
Select one:
a.
Manual AIS
b.
Data
c.
Software
d.
Confidentiality
________ is the component of accounting information system referring to the system users.
Select one:
a.
Accounting
b.
Computer-based
c.
People
d.
Cost
Drawing and net loss are both deducted from the beginning capital in the
Statement of Equity.
Select one:
True
False
The difference between revenues and expenses is always a profit.
Select one:
True
False
The statement that summarizes the revenues, expenses, profit or loss of a
business for a given period of time
Select one:
a.
Statement of Equity or Statement of Changes in Equity
b.
Balance Sheet
c.
Financing Institutions
It is the financial statement that is prepared first because its bottom line figure
will be used in the other financial statements.
Select one:
a.
Current liabilities or short-term liabilities
b.
Income Statement
c.
Statement of Equity or Statement of Changes in Equity
d.
Accrual of income
Expenses decrease the assets of the business.
Select one:
True
False
The statement added by the International Accounting Standards Board to the
three basic statements set by the Accounting Standards Council.
Select one:
a.
Financing Institutions
b.
Balance Sheet
c.
Statement of Equity or Statement of Changes in Equity
d.
Income Statement
The statement of cash flow is also directly related to the balance sheet as it
details the change in cash during the period as it affects the other components
of the balance sheet like other assets, liabilities and equity.
Select one:
True
False
It is also called the Statement of financial Position.
Select one:
a.
Statement of Equity or Statement of Changes in Equity
b.
Financing Institutions
c.
Income Statement
d.
Balance Sheet
Net loss is a factor affecting capital.
Select one:
True
False
They are the users who are interested in the financial statements of a business
to assess its financial condition in terms of liquidity to avoid bad debts.
Select one:
a.
Financing Institutions
b.
Statement of Equity or Statement of Changes in Equity
c.
Income Statement
d.
Balance Sheet
Following are the other titles for Income Statement except
Select one:
a.
Profit and Loss Report
b.
Statement of Cash flows
c.
Statement of Comprehensive Income
d.
Statement of Revenue and Expense
Give the following for RST Trading: Gross profit, P400,000 which is 40% of net
sales , sales discount is 5%, sales returns and allowances is 7.5% The following
are expense except
Select one:
a.
Rent Expense
b.
Depreciation
c.
Prepaid Insurance Expense
d.
Utilities Expense
Give the following for RST Trading: Gross profit, P400,000 which is 40% of net
sales , sales discount is 5%, sales returns and allowances is 7.5%How much is
the net sales?(round-off your answers to the nearest peso)
Select one:
a.
P1,000,000
b.
P400,000
c.
None of these
d.
P600,000
The Cash balance on Jan 1, 2017 is P250,000, net cash outflows is P95,000,
Cash balance on Dec 31, 2017 is P265,000. What amount should be reported in
the statement of financial position on December 31, 2017?
Select one:
a.
P360,000
b.
P265,000
c.
P250,000
d.
P155,000
The following are shown in the balance sheet except
Select one:
a.
Unearned Service Income
b.
Prepaid Rent Expense
c.
All of these
d.
Allowance for Uncollectible Accounts
Give the following for RST Trading: Gross profit, P400,000 which is 40% of net
sales , sales discount is 5%, sales returns and allowances is 7.5% Sales Returns
and Allowances is(round-off your answers to the nearest peso)
Select one:
a.
P85,714
b.
P942,857
c.
None of these
d.
P57,143
The following are non- current assets except
Select one:
a.
Building
b.
Repair Equipment
c.
Land
d.
Inventory
The Cash balance on Jan 1, 2017 is P250,000, net cash outflows is P95,000,
Cash balance on Dec 31, 2017 is P265,000. How much is the net cash inflows
during the year?
Select one:
a.
P110,000
b.
P170,000
c.
P15,000
d.
P155,000
If the total assets of ABC is P750,000 and liabilities is 30%, total equity is
Select one:
a.
None of these
b.
P225,000
c.
P525,000
d.
P750,000
The Cash balance on Jan 1, 2017 is P250,000, net cash outflows is P95,000,
Cash balance on Dec 31, 2017 is P265,000. How much is the net increase in
cash for 2017?
Select one:
a.
P110,000
b.
P170,000
c.
P15,000
d.
P155,000
