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FundamentalOfAccountancy
Fundamentals of Accountancy, Business and Management (AMA Computer University)
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Investing activities cannot be presented in direct or indirect method.
Select one:
True
False
Accrual basis of accounting is a basic accounting principle that states that
income shall only be recognized when cash is received, and expenses shall only
be recorded when cash is paid.
Select one:
True
False
Owner's equity represents the right of the owner over the resources of the firm.
Select one:
True
False
The owner's equity is also called capital, net assets, or net worth.
Select one:
True
False
Residual asset is the result of combining liabilities and equity.
Select one:
True
False
The cost accountant handles Management Accounting.
Select one:
True
False
There are common account titles between assets and liabilities.
Select one:
True
False
Revenues are also known as income.
Select one:
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True
False
Current assets are expected to be used after 12 months.
Select one:
True
False
Accounting is defined in part as the art of ____________, ___________, and
____________ in a significant manner and in terms of money, transactions and
events.
Select one:
a. recording, classifying, summarizing
b. processing, computing, finalizing
c. journalizing, synthesizing, reporting
d. analyzing, evaluating, assessing
This occurs whenever the enterprise purchased goods or received services on
account issuing a promissory note to settle the account in a specified future
date.
Select one:
a. Mortgage Payable
b. Notes Payable
c. Accounts Payable
d. Bonds Payable
Gross profit is P150,000, total selling expenses is P39,000, and total general and
administrative expenses cost P52,000. Compute for the operating income.
Select one:
a. P59,000
b. P163,000
c. P241,000
d. Cannot be determined from the given data
The firm can create as many capital accounts as there are owners in a
corporation.
Select one:
True
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False
Increase in assets is recorded as a Debit.
Select one:
True
False
Cash and cash equivalents are current assets.
Select one:
True
False
There are common account titles between assets and liabilities.
Select one:
True
False
Liabilities are company's obligations.
Select one:
True
False
Cash flows are categorized into three types; these activities does not determine
the purpose for which the cash has been used.
Select one:
True
False
apital is also known as a residual asset.
Select one:
True
False
Question 24
Correct
Mark 1.00 out of 1.00
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Cash basis accounting relies entirely on the payment and receipt of cash.
Select one:
True
False
Question 25
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CPA means Certified Public Accountant.
Select one:
True
False
The following are the advantages of forming a partnership except
~Minimal regulatory requirements than corporation.
Select one:
a. Can exist for a period of 50 yrs
b. more capital from partners
c. Exempt from paying corporate tax
Question 27
Correct
Mark 1.00 out of 1.00
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Account form is more commonly used form of an SFP.
Select one:
True
False
The Calendar year ends on January 01.
Select one:
True
False
The acquisition and disposal of long-term assets, including investments not
considered cash equivalents are parts of an investing activities.
Select one:
True
False
Question 33
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Net loss indicates that the business is doing well.
Select one:
True
False
Question 34
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In cash basis accounting, income shall only be recognized when cash is
received, and expenses shall only be recorded when cash is paid.
Select one:
True
False
It is a voluntary association of at least 15 persons having a common bond of
interest for the purpose of generating capital from among themselves through a
systematic and continuous savings program in order to grant loans to each
other at reasonable rates of interest.
Select one:
a. corporation
b. partnership
c. cooperative
d. single proprietorship
Question 36
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Operating activities may be presented using either the direct method or indirect
method.
Select one:
True
False
In this principle, it is assumed that the business owners or managers are
separate from the business enterprise.
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Select one:
a. Going concern principle
b. matching principle
c. Dual effect principle
d. Business entity principle
Question 39
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Property, plant, and equipment are assets.
Select one:
True
False
Merchandising business are charging fees for rendered services.
Select one:
True
False
Liabilities are present obligations arising from past events.
Select one:
True
False
Question 43
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A sole proprietor's equity account is written as follows: name of owner, capital.
Select one:
True
False
ash receipts from customers is P200,000, cash paid to suppliers is P10,000 and
cash paid to employees is P25,000, how much is the net cash from operating
activities.
Select one:
a. P190,000
b. P175,000
c. Cannot be determined from the data given
d. P165,000
Question 47
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Investments made by the owner may represent the original investment made at
the start of business, and any additional investments thereafter.
Select one:
True
False
Question 48
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Withdrawals or drawings are resources of the firm which were taken by the
owner for personal use.
Select one:
True
False
Cash basis accounting is not acceptable in the accounting industry though we
need to understand this in order to prepare our cash flow statement.
Select one:
True
False
Question 50
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Financing activities are the common transactions happening in the organization.
Select one:
True
False
Cash and cash equivalents are current assets.
Select one:
True
False
In this principle, it is assumed that the business owners or managers are
separate from the business enterprise.
Select one:
a. Dual effect principle
b. matching principle
c. Going concern principle
d. Business entity principle
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Accrual basis of accounting is a basic accounting principle that states that
income shall only be recognized when cash is received, and expenses shall only
be recorded when cash is paid.
Select one:
True
False
Question 6
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Cash flows are categorized into three types: operating, investing, and financing
activities.
Select one:
True
False
Question 7
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Accounting is defined in part as the art of ____________, ___________, and
____________ in a significant manner and in terms of money, transactions and
events.
Select one:
a. recording, classifying, summarizing
b. journalizing, synthesizing, reporting
c. analyzing, evaluating, assessing
d. processing, computing, finalizing
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Question 8
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Manufacturing business converts raw materials to finished goods.
Select one:
True
False
In the statement of changes in equity of a sole proprietor, this is deducted from
the beginning capital to arrive at the ending capital
Select one:
a. withdrawal
b. None of the choices
c. investment
d. Net profit
Question 10
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A mortgage payable is a noncurrent liability.
Select one:
True
False
Question 11
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If additional investment of the owner is P650,000 and payment of long-term loan
to the bank is P700,000, how much is the net cash increase or decrease from
financing activities?
Select one:
a. Decrease of P50,000
b. Increase of P650,000
c. Increase of P50,000
d. Decrease of P700,000
Question 12
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Residual asset is the result of combining liabilities and equity.
Select one:
True
False
Capital is also known as a residual asset.
Select one:
True
False
Beginning inventory is P50,000, net cost of purchases is P125,000, and ending
inventory is P35,000. Compute for the cost of goods sold.
Select one:
a. P140,000
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b. P210,000
c. P110,000
d. Cannot be determined from the given data
Question 16
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Owner's Equity is to sole proprietorship as Capital is to corporation.
Select one:
True
False
Question 17
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Gains increase the income of the business.
Select one:
True
False
A sole proprietor's equity account is written as follows: name of owner, capital.
Select one:
True
False
Question
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Gross profit is P150,000, total selling expenses is P39,000, and total general and
administrative expenses cost P52,000. Compute for the operating income.
Select one:
a. P241,000
b. P163,000
c. Cannot be determined from the given data
d. P59,000
Question 20
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GAAP is Generally Applicable Accounting Principles.
Select one:
True
False
Question 21
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Losses are outflows that result from the main activity of the business.
Select one:
True
False
Increase in assets is recorded as a Debit.
Select one:
True
False
Question 23
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Cash basis accounting relies entirely on the payment and receipt of cash.
Select one:
True
False
Question 24
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The cash in a financing activity mostly involve current assets or income and
expense accounts.
Select one:
True
False
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Question 25
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Financing activities are the common transactions happening in the organization.
Select one:
True
False
There are common account titles between assets and liabilities.
Select one:
True
False
Question 27
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Cash receipts from customers is P200,000, cash paid to suppliers is P10,000 and
cash paid to employees is P25,000, how much is the net cash from operating
activities.
Select one:
a. P165,000
b. Cannot be determined from the data given
c. P190,000
d. P175,000
Question
Correct
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Services businesses offer products.
Select one:
True
False
Question 29
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Liabilities are present obligations arising from past events.
Select one:
True
False
Among all the activities, only financing activities have different ways of being
presented.
Select one:
True
False
Question 31
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Question text
If the beginning capital of Mrs. Castro is P200,000 and she made an additional
investment during the year of P100,000 with a net profit of P52,000, how much
is the ending capital?
Select one:
a. P352,000
b. P248,000
c. P252,000
d. P300,000
Question 32
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The following are the advantages of forming a partnership except
~Minimal regulatory requirements than corporation.
Select one:
a. more capital from partners
b. Can exist for a period of 50 yrs
c. Exempt from paying corporate tax
This is derived from the income statement and is also added to the beginning
capital and additional investments done during the year.
Select one:
a. investment
b. Net profit
c. None of the choices
d. withdrawal
Owner's equity represents the right of the owner over the resources of the firm.
Select one:
True
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False
Question 37
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SFP is an acronym for Statement of Financial Position, which is also known as the
Balance Sheet.
Select one:
True
False
Investing activities cannot be presented in direct or indirect method.
Select one:
True
False
Question 40
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Operating activities may be presented using either the direct method or indirect
method.
Select one:
True
False
Operating expenses and operating income or operating loss are items which can
be found in an income statement prepared in a multi-step approach.
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Select one:
True
False
Question 44
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Cash and cash equivalents are noncurrent assets.
Select one:
True
False
Question 45
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A liability is a present obligation arising out of past events.
Select one:
True
False
The Calendar year ends on January 01.
Select one:
True
False
Question 49
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The cost accountant handles Management Accounting.
Select one:
True
False
Question 50
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Cash basis accounting is not acceptable in the accounting industry though we
need to understand this in order to prepare our cash flow statement.
Select one:
True
False
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Liabilities are company's obligations.
Select one:
True
False
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Owner's Equity is to sole proprietorship as Capital is to corporation.
Select one:
True
False
Question 3
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In cash basis accounting, income shall only be recognized when cash is received, and expenses
shall only be recorded when cash is paid.
Select one:
True
False
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Investing activities cannot be presented in direct or indirect method.
Select one:
True
False
Question 5
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Accrual basis of accounting is a basic accounting principle that states that income shall only be
recognized when cash is received, and expenses shall only be recorded when cash is paid.
Select one:
True
False
Question 6
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Services businesses offer products.
Select one:
True
False
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This is derived from the income statement and is also added to the beginning capital and additional
investments done during the year.
Select one:
a. None of the choices
b. withdrawal
c. investment
d. Net profit
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The transactions falling under operating activities does not primarily involve cash received from
customers and paid to suppliers, lenders, or employees.
Select one:
True
False
Question 9
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Owner's equity usually consists of the owner's investment and the earned profit less any withdrawals
made during a given period.
Select one:
True
False
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Capital is also known as a residual asset.
Select one:
True
False
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The owner's equity is also called capital, net assets, or net worth.
Select one:
True
False
Question 12
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The Statement of Financial Position is commonly prepared at the year ended December 31.
Select one:
True
False
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Gains increase the income of the business.
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True
False
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In this principle, it is assumed that the business owners or managers are separate from the business
enterprise.
Select one:
a. Dual effect principle
b. Going concern principle
c. matching principle
d. Business entity principle
Question 15
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Cash receipts from customers is P200,000, cash paid to suppliers is P10,000 and cash paid to
employees is P25,000, how much is the net cash from operating activities.
Select one:
a. Cannot be determined from the data given
b. P190,000
c. P165,000
d. P175,000
Question 16
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Withdrawals or drawings are resources of the firm which were taken by the owner for personal use.
Select one:
True
False
Question 17
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The following are examples of non-current assets except
~Property, plant and equipment.
Select one:
a. Intangible asset
b. Accounts Receivable
c. Long-term investment
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There are common account titles between assets and liabilities.
Select one:
True
False
Question 19
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Merchandising business are charging fees for rendered services.
Select one:
True
False
Question 20
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The Calendar year ends on January 01.
Select one:
True
False
Question 21
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Accounting is defined in part as the art of ____________, ___________, and ____________ in a
significant manner and in terms of money, transactions and events.
Select one:
a. processing, computing, finalizing
b. recording, classifying, summarizing
c. journalizing, synthesizing, reporting
d. analyzing, evaluating, assessing
Question 22
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Cash basis accounting relies entirely on the payment and receipt of cash.
Select one:
True
False
Question 23
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Account form is more commonly used form of an SFP.
Select one:
True
False
Question 24
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Losses are outflows that result from the main activity of the business.
Select one:
True
False
Question 25
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The acquisition and disposal of long-term assets, including investments not considered cash
equivalents are parts of an investing activities.
Select one:
True
False
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Gross profit is P150,000, total selling expenses is P39,000, and total general and administrative
expenses cost P52,000. Compute for the operating income.
Select one:
a. P163,000
b. P241,000
c. Cannot be determined from the given data
d. P59,000
Question 27
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Beginning inventory is P50,000, net cost of purchases is P125,000, and ending inventory is P35,000.
Compute for the cost of goods sold.
Select one:
a. P110,000
b. P140,000
c. Cannot be determined from the given data
d. P210,000
Question 28
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Investments made by the owner may represent the original investment made at the start of business,
and any additional investments thereafter.
Select one:
True
False
Question 29
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Residual asset is the result of combining liabilities and equity.
Select one:
True
False
Question 30
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A liability is a present obligation arising out of past events.
Select one:
True
False
Question 31
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Cash basis accounting is not acceptable in the accounting industry though we need to understand
this in order to prepare our cash flow statement.
Select one:
True
False
Question 32
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A sole proprietor's equity account is written as follows: name of owner, capital.
Select one:
True
False
Question 33
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Owner's equity represents the right of the owner over the resources of the firm.
Select one:
True
False
Question 34
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There are common account titles between assets and liabilities.
Select one:
True
False
Question 35
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Revenues are also known as income.
Select one:
True
False
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Current assets are expected to be used after 12 months.
Select one:
True
False
Question 37
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Operating activities may be presented using either the direct method or indirect method.
Select one:
True
False
Question 38
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Cash basis accounting is not acceptable in the accounting industry though we
need to understand this in order to prepare our cash flow statement.
Select one:
True
False
Question 39
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CPA means Certified Public Accountant.
Select one:
True
False
Question 40
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This occurs whenever the enterprise purchased goods or received services on account issuing a
promissory note to settle the account in a specified future date.
Select one:
a. Bonds Payable
b. Accounts Payable
c. Notes Payable
d. Mortgage Payable
Question 41
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It is a voluntary association of at least 15 persons having a common bond of interest for the purpose
of generating capital from among themselves through a systematic and continuous savings program
in order to grant loans to each other at reasonable rates of interest.
Select one:
a. single proprietorship
b. partnership
c. corporation
d. cooperative
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Question 42
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The cost accountant handles Management Accounting.
Select one:
True
False
Question 43
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A mortgage payable is a noncurrent liability.
Select one:
True
False
Question 44
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SFP is an acronym for Statement of Financial Position, which is also known as the Balance Sheet.
Select one:
True
False
Question 45
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Manufacturing business converts raw materials to finished goods.
Select one:
True
False
Question 46
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The following are the advantages of forming a partnership except
~Minimal regulatory requirements than corporation.
Select one:
a. Exempt from paying corporate tax
b. Can exist for a period of 50 yrs
c. more capital from partners
Question 47
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If additional investment of the owner is P650,000 and payment of long-term loan to the bank is
P700,000, how much is the net cash increase or decrease from financing activities?
Select one:
a. Increase of P650,000
b. Decrease of P50,000
c. Increase of P50,000
d. Decrease of P700,000
Question 48
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Cash flows are categorized into three types; these activities does not determine the purpose for
which the cash has been used.
Select one:
True
False
Question 49
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Among all the activities, only financing activities have different ways of being presented.
Select one:
True
False
Question 50
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GAAP is Generally Applicable Accounting Principles.
Select one:
True
False
Cash withdrawal of an owner for personal use falls in what cash flow category?
Select one:
a. Operating
b. Investing
c. Assessing
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d. Financing
The owner's equity is also called capital, net assets, or net worth.
Select one:
True
False
Question 4
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Capital is also known as a residual asset.
Select one:
True
False
Question 5
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This is derived from the income statement and is also added to the beginning
capital and additional investments done during the year.
Select one:
a. None of the choices
b. Net profit
c. investment
d. withdrawal
Question
6
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A liability is a present obligation arising out of past events.
Select one:
True
False
Investments made by the owner may represent the original investment made at
the start of business, and any additional investments thereafter.
Select one:
True
False
This occurs whenever the enterprise purchased goods or received services on
account issuing a promissory note to settle the account in a specified future
date.
Select one:
a. Notes Payable
b. Accounts Payable
c. Bonds Payable
d. Mortgage Payable
Question 11
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Account form is more commonly used form of an SFP.
Select one:
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True
False
Question 12
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SFP is an acronym for Statement of Financial Position, which is also known as the
Balance Sheet.
Select one:
True
False
It is a voluntary association of at least 15 persons having a common bond of
interest for the purpose of generating capital from among themselves through a
systematic and continuous savings program in order to grant loans to each
other at reasonable rates of interest.
Select one:
a. cooperative
b. partnership
c. corporation
d. single proprietorship
Question 15
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Losses are outflows that result from the main activity of the business.
Select one:
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True
False
Cash flows are categorized into three types: operating, investing, and financing
activities.
Select one:
True
False
Services businesses offer products.
Select one:
True
False
Question 20
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There are common account titles between assets and liabilities.
Select one:
True
False
Question 21
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Beginning inventory is P50,000, net cost of purchases is P125,000, and ending
inventory is P35,000. Compute for the cost of goods sold.
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Select one:
a. Cannot be determined from the given data
b. P140,000
c. P210,000
d. P110,000
Question 22
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GAAP is Generally Applicable Accounting Principles.
Select one:
True
False
A mortgage payable is a noncurrent liability.
Select one:
True
False
Question 24
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Merchandising business are charging fees for rendered services.
Select one:
True
False
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Question 25
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Gains increase the income of the business.
Select one:
True
False
Withdrawals or drawings are resources of the firm which were taken by the
owner for personal use.
Select one:
True
False
Question 28
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Cash receipts from customers is P200,000, cash paid to suppliers is P10,000 and
cash paid to employees is P25,000, how much is the net cash from operating
activities.
Select one:
a. Cannot be determined from the data given
b. P190,000
c. P175,000
d. P165,000
Question
29
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Accrual basis of accounting is a basic accounting principle that states that
income shall only be recognized when cash is received, and expenses shall only
be recorded when cash is paid.
Select one:
True
False
Current assets are expected to be used after 12 months.
Select one:
True
False
Question 32
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Financing activities are the common transactions happening in the organization.
Select one:
True
False
Question 33
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Revenues are also known as income.
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True
False
Question 34
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In cash basis accounting, income shall only be recognized when cash is
received, and expenses shall only be recorded when cash is paid.
Select one:
True
False
Liabilities are company's obligations.
Select one:
True
False
Question 36
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Owner's Equity is to sole proprietorship as Capital is to corporation.
Select one:
True
False
Question 37
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Cash flows are categorized into three types; these activities does not determine
the purpose for which the cash has been used.
Select one:
True
False
Question 38
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Manufacturing business converts raw materials to finished goods.
Select one:
True
False
The acquisition and disposal of long-term assets, including investments not
considered cash equivalents are parts of an investing activities.
Select one:
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True
False
The cash in a financing activity mostly involve current assets or income and
expense accounts.
Select one:
True
False
Question 42
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CPA means Certified Public Accountant.
Select one:
True
False
Question 43
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The firm can create as many capital accounts as there are owners in a
corporation.
Select one:
True
False
Question
44
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Net loss indicates that the business is doing well.
Select one:
True
False
Owner's equity usually consists of the owner's investment and the earned profit
less any withdrawals made during a given period.
Select one:
True
False
Question 46
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Cash and cash equivalents are noncurrent assets.
Select one:
True
False
Among all the activities, only financing activities have different ways of being
presented.
Select one:
True
False
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Question 50
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Capital is also known as a residual asset.
Select one:
True
False
Current assets are expected to be used after 12 months.
Select one:
True
False
Question 2
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The owner's equity is also called capital, net assets, or net worth.
Select one:
True
False
Question 3
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A mortgage payable is a noncurrent liability.
Select one:
True
False
Question 4
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Cash and cash equivalents are current assets.
Select one:
True
False
Question 5
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Capital is also known as a residual asset.
Select one:
True
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False
Services businesses offer products.
Select one:
True
False
Question 7
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Cash flows are categorized into three types: operating, investing, and financing
activities.
Select one:
True
False
Question 8
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Investing activities cannot be presented in direct or indirect method.
Select one:
True
False
Question 9
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If additional investment of the owner is P650,000 and payment of long-term loan
to the bank is P700,000, how much is the net cash increase or decrease from
financing activities?
Select one:
a. Increase of P650,000
b. Decrease of P50,000
c. Increase of P50,000
d. Decrease of P700,000
Question 10
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Withdrawals or drawings are resources of the firm which were taken by the
owner for personal use.
Select one:
True
False
Land is a current asset.
Select one:
True
False
Question 12
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The firm can create as many capital accounts as there are owners in a
corporation.
Select one:
True
False
Question 13
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Liabilities are company's obligations.
Select one:
True
False
Question 14
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Investments made by the owner may represent the original investment made at
the start of business, and any additional investments thereafter.
Select one:
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True
False
Question 15
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A liability is a present obligation arising out of past events.
Select one:
True
False
ash withdrawal of an owner for personal use falls in what cash flow category?
Select one:
a. Assessing
b. Investing
c. Financing
d. Operating
Question 17
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Revenues are also known as income.
Select one:
True
False
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Question 18
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The Calendar year ends on January 01.
Select one:
True
False
The transactions falling under operating activities does not primarily involve
cash received from customers and paid to suppliers, lenders, or employees.
False
Operating activities may be presented using either the direct method or indirect
method.
Select one:
True
False
Question 21
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Accounting is defined in part as the art of ____________, ___________, and
____________ in a significant manner and in terms of money, transactions and
events.
Select one:
a. processing, computing, finalizing
b. recording, classifying, summarizing
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c. journalizing, synthesizing, reporting
d. analyzing, evaluating, assessing
Question 22
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GAAP is Generally Applicable Accounting Principles.
Select one:
True
False
Question 23
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Accrual basis of accounting records income when earned regardless of when
cash is received.
Select one:
True
False
This is derived from the income statement and is also added to the beginning
capital and additional investments done during the year.
Select one:
a. investment
b. None of the choices
c. withdrawal
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d. Net profit
Question 26
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Gross profit is P150,000, total selling expenses is P39,000, and total general and
administrative expenses cost P52,000. Compute for the operating income.
Select one:
a. P241,000
b. Cannot be determined from the given data
c. P59,000
d. P163,000
Question 27
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It is a voluntary association of at least 15 persons having a common bond of
interest for the purpose of generating capital from among themselves through a
systematic and continuous savings program in order to grant loans to each
other at reasonable rates of interest.
Select one:
a. partnership
b. single proprietorship
c. corporation
d. cooperative
Question
28
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There are common account titles between assets and liabilities.
Select one:
True
False
CPA means Certified Public Accountant.
Select one:
True
False
Question 30
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Among all the activities, only financing activities have different ways of being
presented.
Select one:
True
False
Question 31
Correct
Mark 1.00 out of 1.00
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Gains increase the income of the business.
Select one:
True
False
Question 32
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Owner's Equity is to sole proprietorship as Capital is to corporation.
Select one:
True
False
Question 33
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roperty, plant, and equipment are assets.
Select one:
True
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False
Question 34
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The cash in a financing activity mostly involve current assets or income and
expense accounts.
Select one:
True
False
Manufacturing business converts raw materials to finished goods.
Select one:
True
False
The following are cash flow transactions under the direct method except
Cash paid to creditors
The cost accountant handles Management Accounting.
Select one:
True
False
Question 38
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If the firm has been operating in the past year, the beginning capital of the
current year is the same as the ending capital of the previous year.
Select one:
True
False
Question 39
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This occurs whenever the enterprise purchased goods or received services on
account issuing a promissory note to settle the account in a specified future
date.
Select one:
a. Accounts Payable
b. Notes Payable
c. Bonds Payable
d. Mortgage Payable
Question 40
Correct
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Losses are outflows that result from the main activity of the business.
Select one:
True
False
Question
41
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Correct
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There are common account titles between assets and liabilities.
Select one:
True
False
Question 42
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Cash basis accounting relies entirely on the payment and receipt of cash.
Select one:
True
False
Liabilities are present obligations arising from past events.
Select one:
True
False
SFP is an acronym for Statement of Financial Position, which is also known as the
Balance Sheet.
Select one:
True
False
Question
46
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In cash basis accounting, income shall only be recognized when cash is
received, and expenses shall only be recorded when cash is paid.
Select one:
True
False
Question 47
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The following are the advantages of forming a partnership except
~Minimal regulatory requirements than corporation.
Select one:
a. Can exist for a period of 50 yrs
b. more capital from partners
c. Exempt from paying corporate tax
Question 48
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Owner's equity represents the right of the owner over the resources of the firm.
Select one:
True
False
Question 49
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and is a current asset.
Select one:
True
False
Owner's equity usually consists of the owner's investment and the earned profit
less any withdrawals made during a given period.
Select one:
True
False
Net sales is P450,000, sales discounts is P35,000, and sales returns and
allowances is P15,000. Compute for the gross sales.
Cannot be determined from the given data
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