REMEDIAL

FUNDAMENTALS OF ACCOUNTANCY, BUSINESS, AND MANAGEMENT 2

Name:
Grade Level & Section:
Date:

GENERAL DIRECTION: Read the instructions carefully and answer each question with honesty. Review your answers
before passing your papers. You have a time limit of 60 minutes to answer. Good luck!
I. MULTIPLE CHOICE (20 points)

INSTRUCTION: Encircle whether if the statements are TRUE or FALSE by choosing the correct letter of your
answer.
1. I. Accounting is manipulating financial data.
II. it is a process of analyzing, recording transaction.
A. Statement I is true, statement II is false
B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false
2. I. Luca Pacioli invented the double entry system.
II. He is the father of Modern Math.
A. Statement I is true, statement II is false
B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false

3. I. Separate Accounting Entity states that the business enterprise is considered distinct from the owner.
II. In this practice the owner’s money was separate from the business’ needs.
A. Statement I is true, statement II is false
B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false

4. I. Debit is the right side of the T-account.

II. To increase liability we need to put it in debit.
A. Statement I is true, statement II is false
B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false

5. I. Partnership is registered to DTI.

II. Sole Proprietorship is registered to BIR.
A. Statement I is true, statement II is false
B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false

6. I. Examples of non-current assets are cash, accounts receivable and inventory.

II. non-current assets have a life span of 1 year.
A. Statement I is true, statement II is false
B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false

7. I. Credit is the left side of the T-account.

II. To increase asset we need to put it in debit side.
A. Statement I is true, statement II is false
 B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false

8. I. Assets are the resources owned and controlled by the firm.

II. Liabilities are the payables of the business.
A. Statement I is true, statement II is false
B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false
9. I. Examples of current assets are plant, property and equipment.
II. current liabilities need to be settled more than after 1 year life span.
A. Statement I is true, statement II is false
B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false
10. I. Capital is the obligation of the business need to pay.
II. The business will have profit if income is greater than expense.
A. Statement I is true, statement II is false
B. Statement II is true, statement I is false
C. Both statements are true
D. Both statements are false

II. DEBITS or CREDITS (10 points)

INSTRUCTION: Circle whether the following statements are DEBIT or CREDIT based on the concepts learned.

1. asset decrease
A. DEBIT B. CREDIT
2. liability increase
A. DEBIT B. CREDIT
3. capital increase
A. DEBIT B. CREDIT
4. cost increase
A. DEBIT B. CREDIT
5. income increase
A. DEBIT B. CREDIT
6. expense increase
A. DEBIT B. CREDIT
7. income decrease
A. DEBIT B. CREDIT
8. asset increase
A. DEBIT B. CREDIT
9. Liability decrease
A. DEBIT B. CREDIT
10. capital decrease.
A. DEBIT B. CREDIT
 III. MUTIPLE CHOICE (20 points)
INSTRUCTIONS: Encircle the correct answer.

1. What is the process of identifying, recording and communicating economic events such of an organization
related to users?
A. Income Statement
B. Accounting
C. Budgeting
D. Transaction

2. Which of the following accounting process was determined if transactions are carried out in a book termed
Journal?
A. Analyzing
B. Classifying
C. Recording
D. Summarizing

3. What refers to thorough examination of the balance sheet and profit-and-loss account of an organization?
A. Summarizing
B. Interpreting
C. Communicating
D. Analyzing

4. Which refers to an organization’s business transactions and is very beneficial to all parties involved, both
inside and outside the company? (remembering)
A. Summarizing
B. Costing
C. Liabilities
D. Accounting

5. Which of the following is an example of nature of accounting? (remembering)

A. accounting is a systematize body of knowledge
B. accounting is both an art and beauty
C. accounting is hard
D. accounting is a process

6. Which of the following BEST describes an external user? (understanding)

A. Employee
B. Creditors
C. Owners
D. Mother

7. Which of the following government agencies does verify the accuracy of financial data to ensure the
credibility of the tax returns filed by the business? (understanding)
A. Tax authorities
B. DTI
C. BIR
D. DOLE

8. Which of the following is involve in planning, analyzing and running a business? (understanding)

A. Primary users
B. First users
C. Internal users
D. none of the above
9. Which of the following BEST describes an employee? (understanding)
A. use financial information for job security
B. management needs accounting information
C. Investing money
D. Management financial data

10. Which of the following refers to business is expected to continue indefinitely? (remembering)
A. Materiality Principle
B. Time period Principle
C. Monetary Unit Principle
D. Going-Concern Principle

11. Which of the following BEST explains Business Entity Principle?

A. Separation of owner’s resources to business
B. This needs the currency of money
C. Accounts should be recorded initially
D. Matched with revenue generated

12. Which of the following refers to any amount involved in the business is stated into a single monetary unit?
(remembering)
A. Materiality Principle
B. Accrual Accounting Principle
C. Monetary Accounting Principle
D. Monetary Unit Principle

13. Which of the following BEST describes matching principle? (understanding)

A. All information needs transparency
B. Also known as prudence
C. Should be match with revenue generated
D. Any amount involved in the business

14. Which of the following BEST describes Disclosure Principle

A. All information needs transparency
B. Also known as prudence
C. Any amount involved in the business
D. Appropriate specific period

15. This is also known as prudence?

A. Matching Principle
B. Disclosure Principle
C. Objectivity Principle
D. Conservatism Principle

16. Which of the following is the accounting equation? (understanding)

A. A=L+C
B. A=L-C
C. A-L-C
D. A=L*C
17. Which of the following is an example of Liability account title? (remembering)
A. Loan payables
B. Cash
C. Short-Term
D. Amortization

18. Which is an example of capital account? (remembering)

A. Drawing
B. Inventory
C. Cash
D. Patent

19. What are the following element affecting the equity? (remembering)
A. Investment
B. Income
C. Cash
D. either B or C

20. John created an operation cycle starts at January and ends at December. Which of the following period style
did he use? (understanding)
A. Fiscal period
B. Year period
C. January-December period
D. Calendar period
 IV. PROBLEM SOLUTION (40 points)
INSTRUCTION: Encircle the correct answer, to prove your answer write the solution in a one whole
sheet of yellow paper if needed. Without solution your answers would be invalid. (creation)

1. On July 1, 2020 ABC Company started a catering service. The business invested Php 800,000.00 cash and
kitchen supplies amounting Php 200,000.00 which both happened in the month of July. What would be the
entry?

A. July 2020 Cash 1000000-

Capital 1000000-
To record the cash of the business.
B. July 2020 Cash 800000-
Capital 800000-
To record the investment of the business.
C. July 1, 2020 Cash 800000-
Kitchen supplies 200000-
Capital 1000000-
To record the investment of the business.
D. Cash 800000-
Kitchen supplies 200000-
Capital 1000000-
To record the cash of the business.
2. On July 2, 2020 ABC Company borrowed Php 100,000.00 cash from Matagumpay Bank for the business.

A. July 2, 2020 Cash 1000000-

Loans Payable 1000000-
To record the payable of the business.
B. 2020 July Cash 1000000-
Money Expense 1000000-
To record the transaction of the business.
C. Capital 1000000-
Cash 1000000-
To record the payable of the business.
D. Capital 1000000-
Loans Payable 1000000-
To record the transaction of the business.

V. PROBLEM SOLUTION (70 points)

Instruction: Refer to the table with the given data, make sure that you will use the DOUBLE RULE SYSTEM
as your final answer. Using the data provided in the table, complete the following tasks;
I. Make a Journal Entry
II. Do a T-account
III. Prepare a Trial Balance
IV. Make Adjusting Entry
V. Do Adjusting T-Account
VI. Prepare Adjusted Trial Balance
On January 1, 2023 Orbe Company started a janitorial service business the owner Mr. Orbe ask the accountant
to create an updated Adjusted Trial Balance.

ACCOUNT CODE ACCOUNT NAME

101 CASH
102 PETTY CASH FUND
103 ACCOUNTS RECEIVABLE
104 PREPAID RENT
105 CLEANING EQUIPMENT
106 ACCUMULATED DEPRECIATION
201 CUSTOMER DEPOSIT
202 ACCOUNTS PAYABLE
203 SALARIES PAYABLE
204 UTILITIES PAYABLE
301 ORBE, EQUITY
302 ORBE, DRAWING
401 SERVICE INCOME
402 OTHER INCOME
501 RENT EXPENSE
502 BUSINESS AND TAX PERMIT EXPENSE
503 SALARIES EXPENSE
504 UTILITIES EXPENSE
505 DEPRECIATION EXPENSE

DATA:
Transactions Date Particulars
1 1/01/23 Orbe Invested 1,000,000 to his janitorial business
2 1/02/23 He acquired cleaning supplies on account for 70,000
3 1/04/23 They hired 10 office staffs to support the business.
4 1/05/23 He ordered cleaning equipment to supplier worth 80,000 through cash
5 1/06/23 Orbe paid 21,000 for business and tax permit
6 1/10/23 He paid 25,000 for 3 month rent in advance
7 1/11/23 First customer paid in advance for 150,000 to clean the UMC building
8 1/13/23 Electricity and water expense 9,000 - incurred
9 1/15/23 Rendered service for 95,000 to OMT Company to clean the 9th floor
10 1/17/23 Acquired 30,000 worth of cleaning supplies
11 1/25/23 OMT Company paid full payment

Additional Transaction:
 On February 15, 2023 Orbe Company purchases an equipment for 40,000,000 to be used over 10 years,
with 700,000 salvage value. Record only the annual depreciation expense?
 On March 1, 2023 Orbe Company paid the rent for the whole year amounting 250,000 since the
payment happened last Jan was extracted. How much is the monthly rent?