CHRISTIAN COLLEGES OF SOUTHEAST ASIA

Rosario Bldg., Don Julian Rodriguez Avenue, Ma-a, Davao City

Provides a Quality Education in a Christ-centered Institution
Bachelor of Science in Accountancy
TUTORIAL: Diagnostic Test
Tutors: Agao, Decena, Gonato, Saguidan
Name: __________________________________ Strand: _____________
REMINDER: No cheating. The purpose of this test is to measure and
evaluate your knowledge in accounting. GOD BLESS FUTURE CPA!
INSTRUCTION: Use a separate sheet of paper for your answer. You can write
your solution on the test paper.
1. Which of these are not included as a separate item in the basic accounting equation?
a. Assets b. Revenues c. Liabilities d. Stockholder’s Equity

2. The account format that displays debits, credits, balances, and headings.
a. General Journal b. Ledger c. T-account d. General Ledger

3. Asset accounts have what type of balance?

a. Debit b. Credit c. Contra d. all of the above

4. Which of the following increases equity?

a. Expenses b. Withdrawals c. Treasury Stock d. Revenue

5. A contra asset account has what type of balance?

a. Debit b. Credit c. Contra d. all of the above

6. Accrued income is:

a. Income already received but not yet earned.
b. Income already earned but not yet received or collected.
c. Income long overdue.
d. Income already earned and collected.

7. Accrued expenses is:

a. Expense already paid but not yet incurred.
b. Expenses long time not paid.
c. Expense already incurred but not yet paid.
 d. Expense incurred and paid.

8. The decrease in the usefulness of fixed tangible assets with the passage of time except
land is:
a. Obsolescence b. depreciation c. appreciation d. depletion

9. Unearned income is:

a. Income already earned but not yet received.
b. Income not yet earned and received.
c. Income received before goods or services are performed
d. Income already earned and received.

10.Entries made at the end of the period which bring the account up to date are:
a. Adjusting entries
b. Updating entries
c. Reversing entries
d. All of the above

PROBLEM SOLVING

Princess formed a management consulting firm specializing in cost management systems.

Below are the transactions that occurred during the initial month of operation.
August 2, Princess invested P25,00 cash in the newly formed business.
August 3 hired an administrative assistant, to be paid P3,000 per month. Leased office space
at the rate of P1,000 per month. Signed a contract with Grace to deliver consulting services
valued at P7,500.
August 8 purchased (and immediately used office supplies on account for P750.
August 9 Received P2,500 from Grace for work performed to date.
August 15 paid P1,200 for travel costs associated with consultation work.
August 16 provided services on account to Mej for P3,000
August 17 paid P1,500 to administrative assistant for salary.
August 23 billed Jessel for P4,000 consulting engagement performed.
August 25 Princess withdrew cash from her company worth P1,000.
August 26 collected 50% of the amount due for billing on June 23.
August 27 purchased computer furniture for P4,000, paying P1,000 down.
August 27 paid P750 on the open account relating to June 8 purchase.
August 28 completed the Grace job and billed the remaining amount.
August 30 paid P1,500 to administrative assistant for salary.
August 30 paid rent for August, P1,000.

Princess consulting uses the following accounts for journalizing:

Cash Princess, Capital Rent Expense
Accounts Receivable Princess, Withdrawals Travel Expense
Equipment Revenues Supplies Expense
Accounts Payable Salary Expense

Required:
 Journalize the listed transactions.
 Post the transactions to the appropriate T-accounts.
 Prepare a trial balance as of August 30.
 Determine the amount of the following items as of August 30:

- Cash:
- Accounts Receivables:
- Equipment:
- Accounts Payable:
- Princess, Capital:
- Princess, Withdrawals:
- Revenues:
- Salary Expense:
- Rent Expense:
- Travel Expense:
- Supplies Expense:
- Total Assets:
- Total Liabilities:
- Total Owner’s Equity:
- Net Profit/(Loss):