Republic of the Philippines

Department of Education
REGION IV-A – CALABARZON
SCHOOLS DIVISION OF CAVITE
EMILIA AMBALADA POBLETE NATIONAL HIGH SCHOOL
CAMIA ST., Mary Ann Village, Pob. 5, Silang, Cavite

Fundamentals of Accountancy, Business and Management 1

ABM 11
Quarter 2 – 2nd Semester
Summative Test #1
Week 1-2
Direction: Select the best answer for each questions.
1. Journal entries to be done before the issuance of financial statements is called.
A. adjusting entries C. accrued expenses
B. accrued income D. journal entries
2. This is classified as asset accounts.
A. adjusting entries C. accrued expenses
B. accrued income D. journal entries
3. This expenses is already incurred but must recorded though payment has not yet been made.
A. adjusting entries C. accrued expenses
B. accrued income D. journal entries
4. Is a tool used by an accountant to summarize account balances for financial statement.
A. Journal C. Ledger
B. Worksheet
5. Which of the following is an example of accrued income?
A. services rendered but not yet paid C. renting
B. interest-bearing promissory note
5. There are five function of accounting. Which of the following best describe reporting as a
function of accounting?
A. The process of groupings various accounts.
B. It involves the writing and effects of the transactions and events
C. It is the sorting or grouping of similar transactions and events
D. It involves the preparation of the financial statements
7. Which of the following describe temporary accounts?
A. Accounts forwarded to the income statement column
B. Accounts that need to be closed
C. Both A and B
8. Which of the following describe permanent accounts?
A. Accounts that are extended to the statement of financial position.
B. Accounts become the beginning balances for the next accounting period.
C. Both A and B
9. In a service business, revenues is concerned earned _________________.
A. at the end of the month C. at the beginning of the accounting period
B. at the end of the year D. and recorded directly in the ledger
10. Adjusting entries are prepared
A. always at the end of the accounting period C. Stable monetary unit
B. anytime during the accounting period D. Ignoring concept

Address: Camia St., Mary Ann Village, Pob. 5, Silang, Cavite

Telephone No.: (046) 413-0381
 Republic of the Philippines
Department of Education
REGION IV-A – CALABARZON
SCHOOLS DIVISION OF CAVITE
EMILIA AMBALADA POBLETE NATIONAL HIGH SCHOOL
CAMIA ST., Mary Ann Village, Pob. 5, Silang, Cavite

11. Adjusting journal entries are formally recorded in the ______________.

A. trial balance B. worksheet C. journal D. ledger
12. Recording: writing the effects of the transaction ; Summarizing: ________________
A. final function of accounting process
B. Process of groupings various accounts
C. Sorting and or grouping similar transactions
D. preparation of financial statements
13. Which of the following is incorrect?
A. accrual means to accumulate over a period of time
B. deferral means to postpone until some future time.
C. accrual is a record of income earned regardless of collection.
D. deferral is a record of expense incurred regardless of when it is paid.
14. The total sales were P1, 000,000. The sales on a cash basis amounted to P300, 000. The
policy of the business is to provide 2% of credit sales as bad debt expense. How much is the bad
debt expenses?
A. P20, 000 B. P14, 000 C. P6, 000 D. P4, 000
15. Which of the following state the correct step-by-step procedures for accomplishing the
worksheet.
I. Account title
II. Unadjusted trial balance
III. Adjustments
IV. Adjusted trial balance
V. Income statement
VI. Statement of Financial Position

A. VI, V, IV, III, II, I C. I, II, III, IV, V, VI

B. IV, V, VI, III, II, I D. II, I, IV, III, VI, V

Address: Camia St., Mary Ann Village, Pob. 5, Silang, Cavite

Telephone No.: (046) 413-0381