WorksheetsFABM1 Quarter 2
Total questions: 40
Worksheet time: 1hrs 4mins
_________________represent payments made for expenses which have not yet been incurred. In other words, these are "advanced payments" by a company for supplies, rent, utilities and others that are still to be consumed.
Depreciation
Doubtful Account
Prepaid Expense
Deferred Income
Correcting the record of a transaction that has either not been recorded or recorded in an incomplete or incorrect is called:
Adjustment
Closing of Accounts
Trial Balance
Balance Sheet
Expenses against which goods or services have been received but payment has not been made are called:
Prepaid Expenses
Deferred Expenses
Outstanding Expenses
Advance Expenses
Adjusting entries are made:
At the beginning of the year
At the end of the year
During the year
All of these
The accounting cycle starts with the:
Preparation of ledger accounts
Preparation of trial balance
analysis of business transaction
preparation of adjusting entries
The Fast Company purchases land for $12,000. The payment is made by issuing 1,200 shares of common stock of $10 each. The proper journal entry for this transaction would be:
Land 12,000 Dr. & Cash 12,000 Cr.
Land 12,000 Dr. & Accounts Payable 12,000 Cr.
Common Stock 12,000 Dr. & Accounts Payable 12,000 Cr.
Land 12,000 Dr. & Common Stock 12,000 Cr.
In accounting/bookkeeping, the term posting refers to:
Transfer of information from ledger to trial balance.
Transfer of entries from journal to ledger.
Preparation of financial statements from trial balance .
None of these
The right hand side of a T-account is termed as:
Debit side
Credit side
Income side
Expense side
Which of the following establishments is a merchandising business?
Barber Shop
Dental Clinic
Restaurant
Pharmacy
It is a type of business activity that buys and sells goods to earn a profit.
Merchandising Business
Manufacturing Business
Service Business
None of these
A merchandising inventory system where cost of goods sold is determined only at the end of an accounting period.
Ending Inventory
Periodic System
Beginning Inventory
Perpetual System
Analyze the following statements:
Statement 1: A periodic inventory system provides better control over inventories than a perpetual inventory.
Statement 2: The periodic system only periodically updates the cost of inventory on hand.
Only Statement 1 is True
Only Statement 2 is True
Both Statements are True
Both Statements are False
Net income plus operating expenses is equal to:
Cost of goods sold
Cost of goods available for sale
Net sales
Gross profit
____________result when customers are dissatisfied with merchandise and are allowed to return the goods to the seller for credit or a refund.
Sales return
Credit terms
inefficiency
Sales Allowances
Using a perpetual inventory system, the entry to record the return of merchandise purchased on accounts include a:
Debit to Cost of Goods Sold
Credit to Accounts Payable
Credit to Merchandise Inventory
Credit to Sales
Merchandise with an invoice price of $4,000 is purchased on June 2 subject to terms of 2/10, n/30, FOB Destination. Transportation costs paid by the seller totaled $150. What is the cost of the merchandise if paid on June 12, assuming the discount is taken?
$4,150
$4,070
$4,067
$3,920
The collection or group of accounts in an organization is known as:
General Journal
General Ledger
Trial Balance
Balance Sheet
How would you post the following Journal entry to ledger?
Rent Expense $200 Dr.
Cash $200 Cr.
Cash account would be debited by $200 and rent expense account would be credited by $200
Rent expense account would be debited by $200 and A/C P.A account would be credited by $200
Cash account would be debited by $200 and loss account would be credited by $200
Rent expense account would be debited by $200 and cash account would be credited by $200
The grouping of all accounts of a company showing its respective outstanding balances. - It is also called the book of final entry of accounting transactions.
Ledger
General Ledger
Subsidiary Ledger
General Journal
It is a group of accounts with a similar characteristic (e.g., accounts receivable and accounts payable). It is an additional record to the general ledger utilized by the company to track the per-individual accounts of the company’s customers, creditors, and the like.
Ledger
General Ledger
Subsidiary Ledger
General Journal
It is used mainly to track the individual account balances of the company’s customers.
Accounts receivable ledger
Accounts payable ledger
Accounts payable subsidiary ledger
General ledger
A list which contains balances of accounts to know whether the debit and credit balances are matched.
Balance Sheet
Day Book
Journal
Trial Balance
It displays the outstanding balances of each of the creditors of the company
Accounts receivable ledger
Accounts payable ledger
Accounts payable subsidiary ledger
General ledger
The ____________ contains all the asset, liability, and owner’s equity accounts of the company.
Ledger
General Ledger
Subsidiary Ledger
General Journal
Which of the following will not affect the agreement of trial balance?
An amount of purchase of 10,000 recorded in cr. A/c as 1,000
Customer account debited with the amount of cash received
An entry of debit of 1,000 was credit with twice the amount
An entry posted twice in the ledger
These are the importance of adjusting entries, EXCEPT:
Revenue will appear too low
Expenses may be understated
Financial statements will not be accurate
Reflect the true financial position
Accounting standards require that revenue is recognized when it is earned and the amount can be measured reliably.
Matching principle
Adjusting entries
Revenue recognition
Depreciation
The formula in annual depreciation:
(Useful life – Acquisition cost) / Residual Value
(Acquisition cost – Salvage or Residual Value) / Useful Life
(Acquisition cost – Accrued income) / Residual Value
(Accrued income – Residual Value) / Useful Life
Is revenue that has been recognized by the business, but the customer has not yet been billed.
Adjusting Entries
Accrued Revenue
Deferred Revenue
Adjustments
Are changes to journal entries you've already recorded. Specifically, they make sure that the numbers you have recorded match up to the correct accounting periods.
Adjusting Entries
Accrued Revenue
Deferred Revenue
Adjustments
Gross profit from sales is the difference between
net sales and operating expenses
net sales and the cost of goods sold
net sales and the cost of goods sold plus all the expenses
gross sales less the sales discounts and sales return and allowances
Which of the following is used to determine the cost of goods available for sale (periodic inventory)?
beginning merchandise inventory + purchases + ending merchandise inventory
beginning merchandise inventory - purchases - ending merchandise inventory
beginning merchandise inventory - purchases + freight charges
beginning merchandise inventory + purchases - freight charges
The records for Uptown Pet Shop showed the following: Sales P75,000, Beginning Inventory P10,000, Purchases 45,000, Cost of goods sold 50,000. The ending merchandise inventory must have been:
P5,000
P15,000
P25,000
P40,000
The buyer received an invoice from the seller for merchandise with a list price of P400 and credit terms of 2/10, n/60. The number 10 in the credit terms is the
credit period
cash discount allowed for early payment of the invoice.
discount period
trade discount
Under the periodic inventory system, the Purchases account is used to record
only cash purchases of merchandise inventory
purchases of any asset on account or note payable
only purchases of merchandise inventory on account
purchases of merchandise inventory for cash or on account
If gross sales is ₱40,000, sales returns and allowances ₱1,000, sales discounts ₱400, and delivery expenses ₱100, the net sales of the business will total
₱38,500
₱38,600
₱40,000
₱39,000
The Sun Set Shade Company purchased three pieces of office equipment for a total price of ₱2,100. One piece of equipment costing ₱800 was damaged on delivery and was returned to the vendor. The invoice has not been paid. The proper journal entry for the return is
Merchandise Inventory, debit, ₱800; Accounts Payable, credit, ₱800
Acc. Payable, debit, ₱800; Merchandise Inventory, credit, ₱800
Accounts Payable, debit ₱800; Office Equipment, credit, ₱800
Accounts Payable, debit ₱2,100; Purchases, credit, ₱2,100
The formula for gross profit is:
Gross profit = Revenue – Cost of goods sale
Gross profit = Revenue – Expenses
Gross profit = Revenue – Cost of goods sales/expenses
Gross profit = Income/ Expenses
_____________ is the profit a company makes after deducting the costs associated with making and selling its products, or the costs associated with providing its services.
Gross profit
Revenue
Income
Expenses
The formula of Cost of Goods Sold is:
COGS = Beginning Inventory – Purchases During the Period – Ending Inventory
COGS = Beginning Inventory + Purchases During the Period – Ending Inventory
COGS = Beginning Inventory + Purchases During the Period + Ending Inventory
COGS = Beginning Inventory + Purchases During the Period / Ending Inventory
