LICEO del VERBO DIVINO, INC.

Avenida Veteranos, Tacloban City

BASIC EDUCATION DEPARTMENT- SENIOR HIGH SCHOOL

School Year 2021-2022

FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND MANAGEMENT 1

Preliminary Examination

General Directions:
1. This is a varied type of test that is composed of 50 items.
2. Flag the question if you have a problem about the item.
3. During the exam you are encourage not to open any other browsers o tabs.
4. If ever you are using a PC or a laptop you are encourage not to use a mobile phone while taking the exam.
5. Proceed to the next item if the question confuses you but make sure not to leave it unanswered.
6. Review your answers before submitting the test.
7. Failure to follow any of the given directions below will result to losing the mark for that item.
8. This is an online exam. If ever you encounter any problem with the internet connection or the system immediately contact your
adviser or the subject teacher.
9. Your teachers can’t see you. Let us test your honesty.
10. CHEATING IS A SERIOUS OFFENSE

TEST I. MULTIPLE CHOICE

DIRECTIONS: Read each item carefully and choose the correct answer.
1. Which professional organization defines accounting as an art?
A. Accounting Standards Council (ASC)
B. American Accounting Association (AAA)
C. American Institute of Certified Public Accountants (AICPA)
D. Philippine Institute of Certified Public Accountants (PICPA)
2. The nature of accounting where it has definite techniques and its proper application requires a particular skill and
expertise.
A. Accounting is an art.
B. Accounting is a process.
C. Accounting is an information system.
D. Accounting is a means and not an end.
3. Which of the following activities will NOT result in a business transaction that is financial in nature?
A. Hiring of a staff C. Borrowing of money from a bank
B. Receipt of electricity bill D. Purchase of photocopying machine
4. Which professional organization below defines accounting as a service activity?
A. Accounting Standards Council (ASC)
B. American Accounting Association (AAA)
C. American Institute of Certified Public Accountants (AICPA)
D. Philippine Institute of Certified Public Accountants (PICPA)
5. Which of the following activities will result in a business transaction that is financial in nature?
A. Voting for new CEO C. Hiring new employees
B. Rent for office space D. Board of director’s meeting
6. The nature of accounting where it clearly states that all other transactions that are non-monetary are not within the
scope of accounting.
A. Accounting is a process.
B. Accounting is an information system.
C. Accounting is a means and not an end.
D. Accounting deals with financial information and transactions.
7. Who is considered as the father of modern accounting?
A. Augustus C. Archimedes
B. Suetonius D. Luca Pacioli
"May the Holy Triune God live in our hearts and in the hearts of all."
Your Home for Excellence and Christian Formation
8. Which nature of accounting best emphasizes that accounting is not the objective?
A. Accounting is a process.
B. Accounting is an information system.
C. Accounting is a means and not an end.
D. Accounting deals with financial information and transactions.
9. Which order of events correctly portrays the history of accounting?
A. Early development in Mesopotamia – Development in the Roman Empire – Dissemination of double-entry
bookkeeping in the 14th century Italy – Formation of accounting standards such as PAS and PFRS
B. Development in the Roman Empire - Formation of accounting standards such as PAS and PFRS -
Dissemination of double-entry bookkeeping in the 14 th century Italy - Early development in Mesopotamia
C. Dissemination of double-entry bookkeeping in the 14 th century Italy - Early development in Mesopotamia -
Development in the Roman Empire - Formation of accounting standards such as PAS and PFRS
D. Formation of accounting standards such as PAS and PFRS - Development in the Roman Empire -
Formation of accounting standards such as PAS and PFRS - Early development in Mesopotamia
10. Accounting is recognized and characterized as a storehouse of information. This refers to the nature of accounting
as ___________________.
A. an art C. a service activity
B. a process D. an information system
11. Tax authorities use the accounting information of the business to ____________________.
A. determine whether the debts owed to them will be paid when due
B. determine the credibility of the tax returns filed on behalf of the company
C. ensure that the company’s disclosure of accounting information is in accordance with the rules and
regulations set
D. assess the credit worthiness and the capability of the business to pay its obligation including the related
interests on maturity date
12. Which among the following is NOT considered an internal user of accounting information?
A. Suppliers C. Owners of a business
B. Employees D. Department managers
13. This group of users of accounting information puts assets to the company with hopes of earning acceptable returns
from the profit of the business.
A. Creditors C. Government
B. Suppliers D. Potential investors
14. Which of the following is NOT considered an external user of accounting information?
A. Customers C. Potential creditors
B. BIR officials D. Production supervisor
15. Employees are mainly concerned with ___________________.
A. The company’s ability to pay salaries
B. The company’s ability to pay obligations when they become due
C. The company’s ability to provide other employment opportunities
D. The management’s plan to expand the company to yield more revenues
16. Which of the following refers to any bookkeeping system that has a debit and a credit for each transaction?
A. Information system C. Double-entry bookkeeping system
B. Single-entry bookkeeping system C. None of the choices
17. This is a set of interrelated components that work together to achieve a common purpose.
A. Information system C. Double-entry bookkeeping system
B. Single-entry bookkeeping system C. None of the choices
18. Which of the following defines accounting as a process?
A. Accounting Standards Council (ASC)
B. American Accounting Association (AAA)
C. American Institute of Certified Public Accountants (AICPA)
D. Philippine Institute of Certified Public Accountants (PICPA)
19. He popularized the system of recording business transactions using memorandum books, journal books, and ledger
books.
A. Augustus C. Archimedes
B. Suetonius D. Luca Pacioli

"May the Holy Triune God live in our hearts and in the hearts of all."
Your Home for Excellence and Christian Formation
 20. The Roman government kept detailed financial information of his deeds regarding the stewardship of Roman
resources.
A. Augustus C. Archimedes
B. Suetonius D. Luca Pacioli

TEST II. IDENTIFICATION

DIRECTIONS: Classify each of the following as either external or internal user of accounting information. Write E if it’s an
external user and I if it’s an internal user.

21. Creditors
22. Suppliers
23. Managers
24. Customers
25. Employees
26. General Public
27. Potential Investors
28. Bureau of Internal Revenue
29. Board of directors of the company
30. Securities and Exchange Commission

TEST III. ESSAY

DIRECTIONS: Read and understand the following. Write your answer on the space provided.

31 – 35. Explain briefly why accounting is a process.

36 – 40. Distinguish a tax authority from a regulatory body.
41 – 45. Compare and contrast potential creditors and potential investors.
46 – 50. Give at least five (5) business transactions accounting deals with.

Rubric for the Essay

4 3 2 1
Organization Information in logical, Student presents Reader has difficulty Sequence of
interesting sequence information in logical following work information is difficult
which reader can sequence which because student to follow.
follow. reader can follow. jumps around.
Content Knowledge Student Student is at ease Student is Student does not
demonstrates full with content, but fails uncomfortable with have grasp of
knowledge (more to elaborate. content and is able to information; student
than required). demonstrate basic cannot answer
concepts. questions about
subject.
Grammar and Presentation has no Presentation has no Presentation has Work has four or
Spelling misspellings or more than two three misspellings more spelling errors
grammatical errors. misspellings and/or and/or grammatical and/or grammatical
grammatical errors. errors. errors.

Prepared by:

ZYBEL F. ROSALES
Subject Teacher

"May the Holy Triune God live in our hearts and in the hearts of all."
Your Home for Excellence and Christian Formation
 Fundamentals of Accountancy, Business and Management 1 | Preliminary Examination
ANSWER KEY

TEST I. MULTIPLE CHOICE

1. C
2. A
3. A
4. A
5. B
6. D
7. D
8. C
9. A
10. D
11. B
12. A
13. D
14. D
15. A
16. C
17. A
18. B
19. D
20. A

TEST II. IDENTIFICATION

31. E
32. E
33. I
34. E
35. I
36. E
37. E
38. E
39. I
40. E

"May the Holy Triune God live in our hearts and in the hearts of all."
Your Home for Excellence and Christian Formation