QUIZ 3 Intermediate Accounting 3 1st Semester SY2324

1/23/24, 11:02 PM QUIZ 3 - Intermediate Accounting 3 (1st Semester SY2324)
QUIZ 3 - Intermediate Accounting 3 (1st

Semester SY2324)
Statement of Cash Flows and Accounting Policies and Estimates
READ ME FIRST:
1. Your gadget and internet connection will be your primary responsibility. As much as possible,
prepare a backup for internet connection (especially for students who are dependent on WIFI
plugged via electricity).
2. Avoid refreshing the browser/link to avoid technical issues.
3. Avoid opening other applications/tabs in your browser. They may interrupt not only your internet
connection but also the MS Forms.
4. Maintain screenshots of your answers that can be used in case of an emergency.
5. For the problem solving cases, please present your solutions in good form in a separate
worksheet. I will be requiring you to submit after the quiz. Non-compliance will result to
invalidation of your score for the problem solving part.
6. Make sure to choose/put your correct section. Failure to do so will also result to invalidation of
your score.
7. Be honest. Cheating in any form before or during the quiz will result in a zero score.
8. For any technical difficulties encountered while taking the exam, send me an e-mail with the
screenshots with the subject "Course Code Quiz #x - Technical Issues" as soon as practicable. To
reiterate, all official communications must be coursed through FEU webmail.
God bless and good luck :-)
Correct 1/1 Points
When preparing a statement of cash flows using the indirect method, the
amortization of trademarks should be reported as a/an:
*
https://forms.office.com/Pages/ResponseDetailPage.aspx?id=3F6kgO7V4EaddTfEe-m3zHo_Nf_QH_9EmT5HCGQvgPdUNFdGR0gwTlI2RElVUEtZ… 1/27
increase in cash flows from investing activities.
reduction in cash flows from investing activities,
increase in cash flows from operating activities.
decrease in cash flows from operating activities.
Correct 1/1 Points
Non-cash investing and financing activities, if material, are:

*
reported in the statement of cash flows under the "all financial resources concept”.
reported in the statement of cash flows if the indirect method is used.
disclosed in a note or separate schedule accompanying the statement of cash flows.
not reported or disclosed since they have no impact on cash.
Correct 1/1 Points
Financing activities are:

*
activities that involve the production or purchase of merchandise and the sale of goods and
services to customers, including expenditures to administer the business.
transactions that involve making and collecting loans or that involve purchasing and selling
plant assets and other productive assets.
transactions with owners or long-term creditors of the business or that involve borrowing
cash on a short-term basis.
cash flows typically from receipts of interest payments, cash collections from customers, and
dividends paid by other companies.
Correct 1/1 Points
In preparing a statement of cash flows, which of the following transactions

would be considered an investing activity?
*
Sale of a property and equipment
Issuance of bonds payable at a discount
Purchase of treasury shares
Sale of share capital
Correct 1/1 Points
A company acquired a building, paying a portion of the purchase price in cash

and issuing a mortgage note payable to the seller for the balance. In a
statement of cash flows, what amount is included in investing activities for the
above transaction?
*
Cash payment
Acquisition price
Mortgage amount
Zero
Correct 1/1 Points
In a statement of cash flows, receipts from sale of property, plant and

equipment would be classified as cash inflows from:
*
liquidating activity.
operating activity.
investing activity.
financing activity.
Correct 1/1 Points
Under the indirect method, cash flows from operating activities would be
increased by:
*
gain on sale of investments.
increase in prepaid expenses.
decrease in accounts payable.
decrease in accounts receivable.
Correct 1/1 Points
A company's wages payable increased from the beginning to the end of the
year. In the company's statement of cash flows in which the operating activities
section is prepared under the direct method, the cash paid for wages would be:
*
salary expense plus wages payable at the beginning of the year.
salary expense plus the increase in wages payable from the beginning to the end of the year.
salary expense less the increase in wages payable from the beginning to the end of the
year.
the same as salary expense.
Correct 1/1 Points
Which of the following would not appear in the statement of cash flows using
the direct method?
*
Cash payments for operating expenses
Cash receipts from customers
Depreciation expense
Cash receipt for money borrowed from a bank
Correct 1/1 Points
10
Would the following be added to or deducted from profit when reporting cash
flow from operating activities using the indirect method (Depreciation
Expense/Increase in Accounts Receivable)?
*
Added/Deducted
Added/Added
Deducted/Added
Deducted/Deducted
Correct 1/1 Points
11
All of the following are cash equivalents, except:

*
money market instruments.
commercial paper.
investments in BSP treasury bills.
investments in available for sale equity securities.
Incorrect 0/1 Points
12
The declaration of cash dividends by the board of directors:

*
would be reported as an operating activity in the statement of cash flows.
would be reported as an investing activity in the statement of cash flows.
would be reported as a financing activity in the statement of cash flows.
is an activity that would not be reported in a statement of cash flows.
Correct 1/1 Points
13
All of the following would be reported in the financing activities section of the
statement of cash flows, except:
*
sale of trading securities.
paying a cash dividend.
issuing ordinary shares
purchasing treasury shares.
Correct 1/1 Points
14
Cash inflows from investing activities result from:

*
decrease in liabilities,
increase in liabilities.
decreases in non-cash assets.
increases in non-cash assets
Correct 1/1 Points
15
In a statement of cash flows, proceeds from the sale of company's own bonds
or mortgages should be classified as a/an:
*
leveraging activity,
operating activity.
investing activity,
financing activity.
Correct 1/1 Points
16
In preparing a statement of cash flows, which of the following transactions

would be considered an investing activity?
*
Sale of a business segment
Issuance of bonds payable at a discount
Purchase of treasury shares
Sale of share capital
Correct 1/1 Points
17
The declaration of cash dividends by the board of directors:

*
would be reported as an operating activity in the statement of cash flows.
would be reported as an investing activity in the statement of cash flows.
would be reported as a financing activity in the statement of cash of cash flows.
is an activity that would not be reported in a statement of cash flows.
Correct 1/1 Points
18
The ending inventory of 2022 is understated as a result of an error in the count

of goods on hand. What is the effect of the error in the net income of 2023?
*
Understated
Overstated
No Effect
Not considered
Correct 1/1 Points
19
No depreciation is taken in 2022 for equipment purchased in October 2022. The

company reports on a calendar year basis and computes depreciation to the
nearest month. What is the effect of the error in the retained earnings at
December 31, 2022?
*
Understated
Overstated
No Effect
Not considered
Correct 1/1 Points
20
Customer's notes receivable was debited to accounts receivable in 2022. What is

the effect of the error in the net income of 2022?
*
Understated
Overstated
No Effect
Not considered
https://forms.office.com/Pages/ResponseDetailPage.aspx?id=3F6kgO7V4EaddTfEe-m3zHo_Nf_QH_9EmT5HCGQvgPdUNFdGR0gwTlI2RElVUEt… 10/27
Correct 2/2 Points
21
The following information is available from ALBANIA Company's accounting

records for the year ended December 31, 2022 (see image below).
How much is the net cash provided by/(used in) operating activities?
*
P370,000
P260,000
P360,000
P770,000
Correct 2/2 Points
22
The following was taken from the 2022 financial statements of AUSTRIA
Company:
Accounts receivable: January 1 - P216,000; December 31 - P304,000
Cash sales and credit sales - P4,380,000
Bad debts expense - P10,000 (No accounts receivable were written off or
recovered during the year.)
How much is the cash collected from customers during 2022?
*
P4,292,000
P4,282,000
P4,380,000
P4,302,000
Correct 2/2 Points
23
For Numbers 23 to 24:
BELGIUM Company's transactions for the year ended December 31, 2022
included the following:
Purchased real estate for P550,000 cash which borrowed from a bank.
Sold investment securities for P500,000.
Paid dividends of P600,000.
Issued 500 ordinary shares for P250,000 cash.
Purchased machinery and equipment for P125,000 cash.
Paid P450,000 toward a bank loan.
How much is the net cash provided by/(used in) investing activities?
*
P675,000
P375,000
P175,000
P50,000
Correct 2/2 Points
24
How much is the net cash provided by/(used in) financing activities?
*
P50,000
P250,000
P450,000
P500,000
Correct 2/2 Points
25
BULGARIA Company's prepaid insurance was P500,000 at December 31, 2022

and P250,000 at December 31, 2021. The insurance expense was P200,000 for
2022 and P150,000 for 2021.
How much is the cash payment for insurance in 2022?

*
P550,000
P450,000
P300,000
P200,000
Correct 2/2 Points
26
DENMARK Company has provided the following 2022 account balances for the
preparation of the annual statement of cash flows (see image below).
The company reported a profit of P750,000 in 2022.
How much is the cash provided by/(used in) operating activities?

*
P727,000
P743,000
P755,000
P757,000
Correct 2/2 Points
27
FINLAND Company is preparing a statement of cash flows for the year ended
December 31, 2022. It has the following account balances (see image below).
During 2022, Honesty sold for P260,000, a machine that cost P400,000, and
purchased several items of machinery.
How much is the Depreciation Expense in 2022?

*
P180,000
P240,000
P280,000
P320,000
Correct 2/2 Points
28
How much is the cost of Machinery purchased during 2022?
P340,000
P700,000
P960,000
P1,100,000
Correct 2/2 Points
29
FRANCE Company's statements of financial position as of December 31, 2022

and 2021 and information relating to 2022 activities are presented below (see
image below).
Additional information relating to 2022 activities:

Profit for the year was P690,000.
Cash dividends of P240,000 were declared and paid in 2022.
Equipment costing P400,000 and having a carrying amount of P150,000 was
sold for P150,000.
Some available for sale securities were sold for P135,000. There were no
acquisitions of securities during 2022.
10,000 ordinary shares were issued for P22 per share.
How much is the net cash provided by/(used in) operating activities?
*
P690,000
P915,000
P940,000
P950,000
Correct 2/2 Points
30
How much is the net cash provided by/(used in) investing activities? *
P1,115,000
P895,000
P865,000
P815,000
Correct 2/2 Points
31
How much is the net cash provided by/(used in) financing activities?
*
P305,000
P440,000
P455,000
P545,000
Correct 2/2 Points
32
The plant assets and accumulated depreciation account balances for GEORGIA
Company are as follows (see image below).
Assuming all changes in the accounts resulted from the sale of an asset and
from depreciation expense of P80,000. The sale resulted to a gain of P30,000.
How much is the selling price of the asset sold?

*
P420,000
P360,000
P260,000
P230,000
Correct 2/2 Points
33
The following information were taken from the 2022 operations of GERMANY
Company:
Dividends revenue - P149,000
Dividends receivable: January 1 – P13,000; December 31 - P17,000
Salaries expense - P840,000
Salaries payable: January 1 - P32,000; December 31 - P53,000
How much is the dividend revenue received during 2022?
*
P145,000
P153,000
P150,000
P149,000
Correct 2/2 Points
34
How much is the salaries expense paid during 2022?

*
P840,000
P819,000
P861,000
P850,000
35
The balance in the retained earnings of GREECE Company at December 31, 2022
was P3,600,000 and at December 31, 2023 was P2,910,000. Profit for 2023 was
P2,500,000. A bonus issue was declared and distributed which increased
ordinary share capital by P1,000,000 and share premium by P550,000. A cash
dividend was also declared and paid.
How much is the cash dividend declared and paid in 2023?

*
P1,240,000
P1,640,000
P2,210,000
P3,190,000
Correct 2/2 Points
36
During 2022, HUNGARY Company discovered that the ending inventories

reported on its financial statements were incorrect by the following amounts:
2021 - P60,000 understated; 2022 - P75,000 overstated. The company uses the
periodic inventory system to ascertain year-end quantities that are converted to
peso amounts using the FIFO cost method.
By how much would the retained earnings at January 1, 2023 be misstated prior
to any adjustments for these errors and ignoring income taxes?
*
P75,000 overstated
P75,000 understated
P15,000 overstated
P15,000 understated
37
After the issuance of its 2022 financial statements, Integrity Company

discovered a computational error of P150,000 in the calculation of its December
31, 2022 inventory. The error resulted in a P150,000 overstatement in the cost of
goods sold for the year ended December 31, 2022. In October 2023, Integrity
paid the amount of P500,000 in settlement of litigation instituted against it
during 2022. The loss was recognized in 2022, because it was considered
probable when the financial statements for 2022 were prepared. Ignore income
taxes.
By how much should the December 31, 2022 retained earnings balance be
adjusted in the 2023 statement of changes in equity?
*
P150,000 increase
P150,000 decrease
P350,000 increase
P350,000 decrease
Correct 2/2 Points
38
On January 1, 2022, ICELAND Company acquired a machine at a cost of

P200,000. It was to be depreciated on the straight line method over a five-year
period with no residual value. Because of a bookkeeping error, no depreciation
was recognized in 2022 financial statements. The oversight was discovered
during the preparation of 2023 financial statements.
What is the depreciation expense on this machine for 2023?

*
P0
P40,000
P80,000
P120,000
Correct 2/2 Points
39
The December 31 year-end financial statements of IRELAND Company

contained the following errors (see image below).
Insurance premiums of P22,500 was paid in 2022 covering the years 2022, 2023,
and 2024. The entire amount was charged to Insurance Expense in 2022.
Likewise, on December 31, 2023, a fully depreciated machinery was sold for
P48,000 but the cash sale was recorded only in January 2024. There were no
other errors during 2022 and 2023 and no correcting entries were made for any
of these errors. Ignore income tax considerations.
What is the total effect of the errors on the 2022 profit?

*
P24,000 overstated
P39,000 overstated
P39,000 understated
P24,000 understated
Correct 2/2 Points
40
What is the total effect of the errors on the 2023 profit? *
P16,500 overstated
P16,500 understated
P24,000 overstated
P13,500 understated
Correct 2/2 Points
41
What is the overstatement or understatement in the working capital at

December 31, 2023 due to the errors? *
P28,500 understatement
P28,500 overstatement
P36,000 understatement
P36,000 overstatement
Correct 2/2 Points
42
What is the total effect of the errors on the retained earnings balance at
December 31, 2023?
*
P52,500 understated
P30,000 understated
P22,500 understated
P22,500 overstated
43
ITALY Company showed a profit before income taxes of P250,000 on December

31, 2022. On your year-end verification of the accounts, you discovered the
following:
P100,000 worth of merchandise was purchased in 2022 and included in the
ending inventory. However, the purchase was recorded only in 2023.
A merchandise shipment valued at P150,000 was properly recorded as
purchases at year-end. Since the merchandise was still at the port area, they
were inadvertently omitted from the inventory balance at December 31,
2022.
The company records sales inclusive of value-added tax (VAT) and charges
sales upon remittance to the BIR. VAT for December 2022 amounting to
P50,000 was remitted to the BIR in January 2023.
Rental of P30,000 on a piece of equipment, applicable for six months, was
received on November 1, 2022. The entire amount was reported as income
upon receipt.
Insurance premium covering the period from July 1, 2022 to July 1, 2024
amounting to P120,000 was paid and recorded as expense in July 2022. The
company did not make any adjustments at the end of the year.
What is the correct profit before income taxes for the year 2022?
*
P320,000
P290,000
P230,000
P180,000
44
What is the effect of the errors in the 2023 net income? *
P100,000 overstated
P100,000 understated
P50,000 understated
P50,000 overstated
45
What is the effect of the errors in the working capital at December 31, 2022?
*
Correct 2/2 Points
46
Upon inspection of the records of KAZAKHSTAN Company, the following facts
were discovered for the year ended December 31, 2022:

A fire insurance premium of P40,000 was paid and charged as insurance
expense in 2022. The fire insurance policy covers one year from April 1,
2022.
Inventory on January 1, 2022 was understated by P80,000.
Inventory on December 31, 2022 was understated by P120,000.
Business taxes of P55,000 for the fourth quarter of 2022 were paid on
January 20, 2023 and charged as expense in 2023.
On December 31, 2022, a cash advance of P100,000 by a customer was
received for goods to be delivered in January 2023. The P100,000 was
credited to Sales. The company's gross profit on sales is 40%.
The profit of KAZAKHSTAN for the year ended December 31, 2022 before
any adjustments for the given information is P1,550,000.
What is the correct profit of KAZAKHSTAN Company for the year ended
December 31, 2022?
*
P1,445,000
P1,485,000
P1,505,000
P1,550,000
47
What is the effect of the errors in the working capital at December 31, 2022? *
P105,000 overstated
P25,000 overstated
P5,000 overstated
P75,000 understated
48
What is the effect of the errors in the retained earnings at December 31, 2022?
*
P75,000 understated
P105,000 overstated
P25,000 overstated
P5,000 overstated
49
Profit for LUXEMBOURG Company for the years 2021 and 2022 is shown below.
A review of the accounts, however, disclosed the following errors (see image
below).
How much is the correct profit in 2021?

*
P246,500
P296,000
P332,000
P336,000
50
How much is the correct profit in 2022? *
P312,500
P289,500
P239,500
P235,500
51
NAME (Surname, Given Name, Middle Name) *
Gonzales, Justin, Cuento
This content is created by the owner of the form. The data you submit will be sent to the form owner. Microsoft is not
responsible for the privacy or security practices of its customers, including those of this form owner. Never give out your
password.
Microsoft Forms | AI-Powered surveys, quizzes and polls Create my own form
Privacy and cookies | Terms of use

QUIZ 3 Intermediate Accounting 3 1st Semester SY2324

Uploaded by

Document Information

Original Description:

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

QUIZ 3 Intermediate Accounting 3 1st Semester SY2324

Uploaded by

Copyright:

Available Formats

1/23/24, 11:02 PM QUIZ 3 - Intermediate Accounting 3 (1st Semester SY2324)

QUIZ 3 - Intermediate Accounting 3 (1st

Correct 1/1 Points

increase in cash flows from investing activities.

reduction in cash flows from investing activities,

increase in cash flows from operating activities.

decrease in cash flows from operating activities.

Correct 1/1 Points

Non-cash investing and financing activities, if material, are:

reported in the statement of cash flows if the indirect method is used.

disclosed in a note or separate schedule accompanying the statement of cash flows.

not reported or disclosed since they have no impact on cash.

Correct 1/1 Points

Financing activities are:

Correct 1/1 Points

In preparing a statement of cash flows, which of the following transactions

Sale of a property and equipment

Issuance of bonds payable at a discount

Purchase of treasury shares

Sale of share capital

Correct 1/1 Points

A company acquired a building, paying a portion of the purchase price in cash

Correct 1/1 Points

In a statement of cash flows, receipts from sale of property, plant and

Correct 1/1 Points

gain on sale of investments.

increase in prepaid expenses.

decrease in accounts payable.

decrease in accounts receivable.

Correct 1/1 Points

salary expense plus wages payable at the beginning of the year.

the same as salary expense.

Correct 1/1 Points

Cash payments for operating expenses

Cash receipts from customers

Cash receipt for money borrowed from a bank

Correct 1/1 Points

Correct 1/1 Points

All of the following are cash equivalents, except:

money market instruments.

investments in BSP treasury bills.

investments in available for sale equity securities.

Incorrect 0/1 Points

The declaration of cash dividends by the board of directors:

would be reported as an operating activity in the statement of cash flows.

would be reported as an investing activity in the statement of cash flows.

would be reported as a financing activity in the statement of cash flows.

is an activity that would not be reported in a statement of cash flows.

Correct 1/1 Points

sale of trading securities.

paying a cash dividend.

issuing ordinary shares

purchasing treasury shares.

Correct 1/1 Points

Cash inflows from investing activities result from:

decreases in non-cash assets.

increases in non-cash assets

Correct 1/1 Points

Correct 1/1 Points

In preparing a statement of cash flows, which of the following transactions

Sale of a business segment

Issuance of bonds payable at a discount

Purchase of treasury shares