FUNDA 2_2ND QUARTER REVIEWER

What is the simplest form of business organization?

• sole proprietorship

• partnership

• corporation

• cooperative

In SCF, it includes activities related to the main revenue-producing activities of the business.

• investing activities

• financing activities

• operating activities

• purchasing activities

These forms are used to document transactions between a seller and a supplier.

• financial statements

• business forms

• bank forms

• accounting books

Which of these statements is about forms of business organization is TRUE?

• A corporation has unlimited liability, making it riskier for its shareholders

• A sole proprietorship allows for easier decision-making but offers limited access to capital

• A partnership provides limited liability for all partners involved

• A corporation faces fewer taxes than other business forms due to its legal structure

Which of these statements about journal is FALSE?

• transactions are recorded in chronological order

• does not provide the balance of accounts

• recording in a journal is called ‘posting’

• it is not the direct reference of financial statements

Which of the following statements about unit investment trust funds (UITFs) is FALSE?

• UITFs are managed by professional fund managers, who make investment decision on behalf of the investors.

• UITFs guarantee a fixed return on investment, regardless of market conditions.

• UITFs are designed to pool money from individual investors to invest in a diversified portfolio of assets.

• UITFs are regulated by the Bangko Sentral ng Pilipinas (BSP) and are required to disclose performance reports.

A company owned by several stockholders faces lawsuit due to a business debt it cannot repay. Despite the company’s financial troubles, the stockholders’ personal assets, such as their homes and savings, remain protected and cannot be used to settle the company’s obligation. What is being illustrated in the given scenario?

• easy access to capital

• business security and perpetuity

• personal liability protection

• fewer tax forms

Which of the transactions below should be recorded under a cash disbursement journal?

• purchases made on account

• principal payments for bank loans

• cash contributions from owners

• deliveries made to customer on account

A company borrowed ₱50,000 from a bank. How should this transaction be recorded?

• debit bank loan; credit cash

• debit cash; credit bank loan

• debit interest expense; credit bank loan

• debit cash; credit accounts payable

It is used as an alternative to receiving report.

(a)