Gmail - INTRODUCTORY MODULE P1- MC

1/5/2019 Gmail - INTRODUCTORY MODULE P1- MC
Prince Guese <gueseprince128@gmail.com>
INTRODUCTORY MODULE P1- MC

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INTRODUCTORY MODULE P1- MC

Multiple Choice Questions (50 items)
Email address *
gueseprince128@gmail.com
Name (Last, First, MI) *
Laluon, Prince Ricky Lenard
Module Learning Objectives
After completing this module, you should be able to recall:

1. knowledge about the components of an accounting system and double-entry recording system.
2. how to perform the accounting processing cycle steps leading to the financial statements.
3. how to analyze economic events, record these transactions using the general journal format and
prepare an unadjusted trail balance.
4. how to record adjusting journal entries in general journal format and prepare an adjusted trial
balance
5. how to prepare financial statement
Introductory Module P1 Composition
This module has two (2) phases which are:

1. Multiple Choice Questions (50 items)
2. Comprehensive Questions in excel format (50 items)
https://mail.google.com/mail/u/0?ui=2&ik=3913416233&view=lg&permmsgid=msg-f%3A1621827606004862196&ser=1 1/14
To proceed to the next phase, a student must correctly answer 85% of all the questions. Upon doing so,
the link to the next phase will be sent together with the results.
Students who failed must go over the topics tested by the questions and study them, each, before
answering again this module to achieve the required score. Students can answer this module any
number of times until Jan. 5, 2019.
On Jan. 6, 2019, students who have failed to achieve the desired score will forfeit their opportunity to
answer the next phase and receive a grade of 0 .
Review of Basic Accounting Process
Each question is adapted from various sources and aims to measure students proficiency and
competence in the covered topics. A score below 85% correct answers, on the first try, indicates that
student failed to acquire and retain from under courses the basic proficiency and competence in the
topics tested. As such, the failing students are required to intensely study the topics covered before
answering again this module to achieve the required score to proceed to the next phase.
Given the following data, calculate the value of the firm’s capital: Fixed assets Php 4,000; stock
Php 350; debtors Php180; cash at bank Php 650 and creditors Php 280. *
Php 5,180
Php 5,460
Php 5,000
Php 4,900
The total of the debit balances listed in a trial balance will not be equal to that of the credit
balances... *
if an amount paid for purchases is posted to Stationery account.

if an amount entered in the prime entry book (journal) is not posted.
if an amount drawn by the owner is posted to the debit of the Capital account.
if a transaction has not been entered in the book of prime entry (journal).
Which of the following errors will a trial balance fail to reveal? *
Php 7,500 received from sales being posted to the Sales account as Php 5,700
Sales account total being added as Php 36,400 instead of Php 39,400
Payment of Php 240 for stationery being posted as Php 420
Payment of Php 2,800 for goods to be sold being posted to Stationery account
A trader, who commenced business in the year, extracted his trial balance on the last day of
the first month as shown below. It failed to balance. Which of the following would explain the
failure? *
Salaries, an expense, has been stated in error as a credit balance.

The trial balance fails to include one or more of the account balances.
The Trial balance has been added wrongly.
A payment has been posted wrongly to the credit side of an account instead of debit.
Which of the following errors would have caused a difference in the trial balance? *
Not recording in the Cash Account Php15,000 paid for purchasing goods for sale
Recording a sale of Php 30,000 as Php 3,000 in the Cash Book
Posting a payment of Php 21,000 for stationery as Php 12,000 to the Stationery account
Posting to Motor vehicles account Php 600 paid for servicing vehicles
A proprietorship employs one full-time accountant. This person is considered an employee. On

the desk in front of her are five different business documents. Which one of the following
would not be considered an original source document from the proprietorship's point of view?
*
A bank receipt for $10,000 evidencing yesterday's cash receipts deposited in the bank.
The original copy of the insurance policy taken out by the proprietorship to insure the vehicle it
purchased during its first month of operations. The annual insurance premium of $500 was printed within
the contract.
The invoice received by the proprietorship from Samsung Electronics when the proprietorship
purchased its first lot of inventory to be sold to its customers.
A cancelled check for $500 representing payment in full for the annual insurance premium
mentioned in item B above.
A copy of the Balance Sheet at the end of the company's first year of existence.
At any given point in time, it is possible to describe general ledger accounts as having an
expected or "normal" balance: either a debit balance or a credit balance. This normal balance
is on the side of the account, that is, the debit side or credit side, which represents the
"increase" side of the account. In order, what is the normal balance for the Equipment account,
the Owner's Equity account, and the Sales Revenue account? *
Debit, credit, credit.
Debit, debit, debit.

Credit, debit, credit.
Credit, credit, debit.
Debit, debit, credit.
The Baker sole proprietorship started operations on January 1, 2011 and uses a calendar-year
accounting period. On February 7, 2011, the company purchases an automobile with an invoice
cost of $10,000. To settle this transaction, the company immediately pays $3,000 cash to the
automobile dealership and signs a three-month note payable for the $7,000 purchase price
balance. A partial general journal entry is given below. Which item accurately describes the
partial entry from Baker's viewpoint? *
Cash is debited for $3,000 and Notes Payable is credited for $7,000.
The asset account Vehicles is debited for $7,000 and Cash is credited for $3,000.
The asset account Vehicles is credited for $10,000 and Cash is credited for $3,000.
Cash is credited for $3,000 and Notes Payable is credited for $7,000.
Notes Payable is credited for $7,000 and the asset Vehicles is credited for $3,000.
A company buys a one-year insurance policy on February 1, 2011, and immediately pays in
cash the $720 insurance premium. The company's bookkeeper records the transaction by
crediting the Cash account for $720 but debits Insurance Expense for $720, instead of debiting
Prepaid Insurance, which would be the correct entry. Based on this information, which
statement concerning the trial balance is correct if the company fails to correct this
bookkeeping error? *
The trial balance is correct as it is.

The total trial balance debits do not equal the total trial balance credits.
The total trial balance debits are higher than the total trial balance credits.
The total trial balance credits are lower than the total trial balance debits.
The total trial balance debits equal the trial balance credits but one or more account balances are
incorrect.
A company buys a new car on February 15, 2011, and immediately pays in cash the $25,000
purchase price. The company's bookkeeper fails to record the transaction at all. Based on this
information, which statement concerning the trial balance is correct if the company fails to
correct this bookkeeping error? *
The trial balance is correct as it is.
The total trial balance debits do not equal the total trial balance credits.
The total trial balance debits are higher than the total trial balance credits.
The total trial balance debits are equal to the total trial balance credits, but one or more accounts
have incorrect balances.
The total trial balance debits equal the trial balance credits, but only one account balance is
incorrect.
Amelia Company received its telephone bill on February 15, 2011 in the amount of $325. This
bill covered the period from January 1, 2011 through January 31, 2011. Amelia paid this bill
immediately. The company uses a calendar year accounting period and prepares its financial
statements only once a year at the end of the year. The general journal entry to record this
transaction includes: *
A debit to the Cash account for $325.

A credit to the Telephone Expense account for $325.
A debit to the Telephone Expense account for $325.
A credit to Accounts Payable for $325.
A debit to Accounts Payable for $325.
A proprietorship has total assets of $1,000,000, total liabilities of $300,000, and total owner's
equity of $700,000. What is the debt ratio (rounded to the nearest percent)? *
33%.
40%.
70%
30%.
10%.
On March 1, 2011, a company collects a $500 deposit from a customer for the installation of a
home-theater system. The installation is scheduled for May 5, 2012. How should the company
record this entry on March 1, 2011? *
The Cash account is credited for $500.

The Sales Revenue account is credited for $500.
The Unearned Sales Revenue account is credited for $500.
The Unearned Sales Revenue account is debited for $500.

None of the above are correct.
A company which sells and services medical insurance policies received one payment of
$14,000 cash from a customer for insurance coverage for the next two years. Recording the
receipt of this cash when it is received will require which of the following? *
Withdrawals to be debited, an asset to be credited
A liability to be debited, an asset to be credited

An asset to be debited, capital to be credited
An asset to be debited, a liability to be credited
One asset to be debited, another asset to be credited
Olivia, the proprietor, deposited $40,000 in the company's bank account. She received the
money as the result of a settlement of a class action lawsuit and decided to invest it in her
business to help with expansion. Recording the transaction on the company books will require
which of the following? *
An asset to be debited, a liability to be credited.

A liability to be debited, an asset to be credited.
An asset to be debited, capital to be credited.

Withdrawals to be debited, an asset to be credited.
One asset to be debited, another asset to be credited.
Which of the following statements is true? *
Revenue accounts are increased by debit entries.

Journalizing entries occurs after posting entries.
Debit entries are entries involving the right-hand side on an account.
An account shows increases and decreases and an account balance.
Journalizing errors should be erased and a correct entry made.
Assets total $100,000 and liabilities total $40,000. What is the debt ratio? *
10%.
25%.
40%.
60%.
100%.
The personal residence of Samuel Leonard was landscaped with all new trees, shrubs, and
flowers. This improvement was paid for with a check written against Samuel's business
checking account. The landscaping provides no benefit to Samuel's business. What account
should be debited for this transaction? *
Samuel Leonard, Capital.
Samuel Leonard, Withdrawals.

Landscaping Improvements.
Landscaping Expense.
None of the above.
One of your company's business checks clears the bank at its correct amount of $500. The
transaction that underlies this check was the cash purchase of office supplies. The entry was
recorded as a debit to Insurance Expense for $50 and a credit to Cash for $50. The correcting
entry should include which of the following? *
A debit to Accounts Receivable for $450.

A credit to Supplies Expense for $500.
A credit to Cash for $50.

Double-entry accounting requires which of the following? *
All journal entries must be posted twice.

At least two accounts are involved, with at least one debit and one credit.
The total amount debited must equal the total amount credited.
Both A and C are correct.
Both B and C are correct.
Although it is possible to find an exception to the following statement, the vast majority of
adjusting entries follow which pattern described below? *
One of the accounts debited or credited is an income statement account while the second account
debited or credited is a balance sheet account.
Both of the accounts debited or credited are income statement accounts.

Both of the accounts debited or credited are balance sheet accounts.
Both of the accounts debited or credited are part of the statement of owner's equity.
None of the above is correct.
A company purchased a two-year fire insurance policy on May 1, 2011. It paid the $2,400
premium in cash on the same date and recorded the entry with a debit to Prepaid Insurance
for $2,400. The company has adopted a 12-month accounting period ending on January 31 of
each year. If the company uses the accrual basis of accounting, how much insurance expense
will be recorded for the periods ended January 31, 2012, and January 31, 2013, respectively? *
$1,800 and $2,400.
$900 and $1,200.

$2,400 and $0.
$0 and $2,400.
None of the above.
The theoretical reason for recording periodic depreciation expense rather than immediately
expensing the cost of a plant asset in the period it is acquired is to adhere to the: *
Cost principle.
Monetary unit principle.
Going-concern principle.
Materiality principle.
Matching principle.
A company adopts the accounting practice whereby all external transactions involving prepaid
expenses, such as prepaid insurance, prepaid rent, and office supplies are initially debited to
the asset account when acquired. If the company fails to adjust any one of these accounts for
the current year, what will be the effect on (1) the current year's total expenses, (2) total
revenues, (3) net income, and (4) ending owner's equity? *
Understated, understated, understated, and understated.

Understated, overstated, overstated, and overstated.
Understated, no effect, overstated, and overstated.

Overstated, overstated, no effect, and no effect.
Understated, no effect, overstated, and understated.
Boron Company is a sole proprietorship. Its bookkeeper has prepared the adjusted trial
balance as of December 31, 2011. Even though this adjusted trial balance is correct in every
respect, there is still one account whose balance does not represent the correct end-of-the-
period balance. Which account is it? *
Accounts Receivable.
Cash.
Accumulated Depreciation.
Owner's equity.
None of these.
At the end of the accounting period, the business had $5,000 of office supplies on hand. At the
beginning of the period, the amount of supplies on hand was $2,000. If the business purchased
$12,000 of office supplies during the year, what amount of office supplies were used during the
year? *
$ 7,000.
$14,000.
$10,500.
$ 9,000.
None of the above.
You own a CPA firm. You have agreed to provide accounting services on behalf of a client for a
fee of $650 per month. Your services will be rendered uniformly during the year, and you begin
your work on April 16. You use the accrual basis of accounting for your own company and
prepare monthly financial statements for your firm. Your client makes his first payment of $650
to you on May 16. Which of the following entries will you record on May 16 when you receive
the $650 cash payment? *
Cash, debit, $325; Accounts Receivable, credit, $325.

Cash, debit, $650; Accounts Receivable, credit, $325; Fees Earned, credit, $325.
Cash, debit, $650; Fees Earned, credit, $650.
Accounts Receivable, debit, $650; Cash, credit, $325; Fees Earned, credit, $325.
None of the above.
A tenant rented space in your company's office building on October 1 at $1,800 per month,
paying seven months' rent in advance. The bookkeeper recognized a current liability of
$12,600. How much of this amount remains unearned as of December 31? *
$12,600.
$5,400.
$7,200.
$0.
None of the above.
An NBA basketball team sells season tickets worth $48 million before the basketball season
starts late in the year. Assume this $48 million is debited to Cash and credited to Unearned
Ticket Revenue. By the end of the calendar year, which also happens to be the end of the
team's accounting period, 25% of the games have been played. What adjusting journal entry
should be made at the end of the year? *
Unearned Ticket Revenue, debit, $12 million; Cash, credit, $12 million.
Ticket Revenue, debit, 12 million; Unearned Ticket Revenue, credit, $12 million.
Unearned Ticket Revenue, debit, $12 million; Ticket Revenue, credit, $12 million.
Ticket Revenue, debit, $12 million; Cash, credit, $12 million.

None of the above.
The notion that the life of a business is divisible into time periods of equal length is known as
which of the following? *
Continuing-concern principle.
Monetary unit principle.

Revenue recognition principle.
Time-period principle.
Business entity principle.
A business rented space in an office building on October 1, at $600 per month, paying 9 months
of rent in advance. The bookkeeper recognized a prepaid asset of $5,400 when the payment
was made. No year-end adjustment was recorded. As a consequence of not recording the
required adjustment, which of following occurred? *
Expenses were overstated and assets were understated.

Expenses were understated and assets were overstated.
Expenses were overstated and assets were overstated.

Expenses were understated and assets were understated.
None of the above.
Dee Hellings, Inc. performed $3,000 worth of services for a client during December but did not
get paid until the first week of February of the next year. No year-end adjusting entry was
recorded on December 31. As a consequence of this oversight, which of the following
occurred? *
Assets were understated and revenue was understated.

Assets were overstated and revenue was understated.
Assets were understated and revenue was overstated.
Assets were overstated and revenue was overstated.
Liabilities were understated and revenue was understated.
For the current period, a company's revenues and expenses are $480,000 and $420,000,
respectively. What is the company's profit margin percentage for the current period? *
25.0%.
87.5%.
12.5%.
$60,000.
None of the above.
At the end of the fiscal year, an adjusting entry was made for accrued salaries of $2,000. The
salaries for one week, $4,250, were paid on the first Friday of the new fiscal period. When the
weekly salaries are paid on the first Friday of the new accounting period, what will be the
general journal entry? *
Salaries Expense, debit, $4,250; Cash, credit, $4,250.
Salary Expense, debit, $2,000; Cash, credit, $2,000.

Salaries Expense, debit, $4,250; Salaries Payable, credit, $4,250.
Salary Expense, debit, $2,250; Salaries Payable, debit, $2,000; Cash, credit, $4,250.
None of the journal entries shown above.
The basic difference between the cash basis of accounting and the accrual basis of accounting
is that each basis interprets differently which two accounting principles? *
The going-concern principle and the cost principle.

The monetary unit principle and the time-period principle.
The matching principle and the revenue recognition principle.

The cost principle and the revenue recognition principle.
The conservatism principle and the cost principle.
The typical accounting worksheet has five sets of columns with each set having a debit column
on the left and a credit column on the right. In moving from left to right across the worksheet,
which of the following lists describes the proper order for four of these sets of columns? *
Adjustments, Adjusted Trial Balance, Unadjusted Trial Balance, and Income Statement.
Adjustments, Adjusted Trial Balance, Income Statement, and Balance Sheet.
Adjusted Trial Balance, Adjustments, Income Statement, and Balance Sheet.
Adjustments, Adjusted Trial Balance, Balance Sheet, and Income Statement.
Unadjusted Trial Balance, Adjustments, Income Statement, and Adjusted Trial Balance.
A company accountant has started to prepare a ten-column worksheet. She calculates the
amount of an adjustment and is about to enter it in the Adjustments column but cannot locate
the name of the account on the worksheet. What should she do? *
Go back to the general ledger. Open an account with the proper name. Enter the adjustment into the
newly created account and then enter the adjustment on the worksheet.
If there is no proper account name on the worksheet, she cannot enter the adjustment on the
worksheet.
Go back to the Chart of Accounts and add a new account to it. Enter the adjustment into the
general journal and then transfer it to the worksheet without having posted it to the general ledger.
Write the name of the account on the first blank line in the worksheet. Enter the adjustment on this
line in the Adjustments column and continue with the worksheet. There is no need to go back to the
general journal or the general ledger at this time.
None of these is the proper procedure.
Braxton Company is a sole proprietorship. Its owner is preparing the accounting worksheet for
the 2009 calendar year. The worksheet is the normal 10-column worksheet studied in the
chapter. There is a $20,000 adjusted balance in the Owner's Drawings account and the account
has its normal or expected balance. What happens to this balance on the worksheet? *
The adjusted balance is extended into the debit column of the Income Statement set of columns.
The adjusted balance is extended into the credit side of the Income Statement set of columns.
The adjusted balance is extended into the debit side of the Balance Sheet set of columns.
The adjusted balance is extended into the credit side of the Balance Sheet set of columns.
None of the above.
A company's bookkeeper has prepared a worksheet for the 2009 calendar year. He has made
all of the adjustments and finished the Adjusted Trial Balance set of columns. He has extended
each of the adjusted account balances from the Adjusted Trial Balance columns over into
either the Income Statement or the Balance Sheet set of columns as appropriate. He has
added up the Income Statement debit and credit columns and he has added up the Balance
Sheet debit and credit columns and has entered the four totals on the appropriate part of the
worksheet. He has not made any mistakes up to this point. What can we say about the
worksheet at this point in time? *
If the company has Net Income for the period, the total debits in the Income Statement columns will
equal the total credits in the Income Statement columns at this point in time.
If the company has Net Income for the period, the Income Statement debit column subtotal will be
greater than the Income Statement credit column subtotal.
If the company has Net Income for the period, the Income Statement credit column subtotal will be
greater than the Income Statement debit column subtotal.
If the company has a Net Income for the period, the Balance Sheet debit column subtotal will be
less than the Balance Sheet credit column subtotal.
None of the above.
Which of the following sets of accounts are both considered to be temporary accounts which
must be closed at the end of the accounting period? *
Cash and Service Revenue.

Depreciation Expense and Interest Revenue.
Owner's Drawings and Accounts Payable.

Cash and Notes Payable.
Owner's Equity and Owner's Drawings.
As described in the textbook, in what order should the temporary accounts be closed? *
(1) expenses, (2) revenues, (3) income summary, and (4) owner's drawings.
(1) owner's drawings, (2) expenses, (3) revenues, and (4) income summary.
(1) revenues, (2) expenses, (3) owner's drawings, and (4) income summary.
(1) revenues, (2) expenses, (3) income summary, and (4) owner's drawings.
None of the above.
Which of the following accounts is a temporary account? *
Notes Payable.
Unearned Revenue.
Capital, Lola Delong.
Lola Delong, Withdrawals.

Land.
A classified balance sheet categorizes assets and liabilities. Which of the following is a typical
categorization? *
Current assets, current liabilities, noncurrent assets, noncurrent liabilities.
Noncurrent assets, current assets, current liabilities, noncurrent liabilities.

Intangible assets, current assets, current liabilities, noncurrent liabilities.
Current assets, noncurrent assets, current liabilities, noncurrent liabilities.
None of the above.
Which of the following is listed on the post-closing trial balance for a sole proprietorship? *
Income Summary.
Sales Revenue.
Accumulated Depreciation.
Depreciation Expense.
Salaries Expense.
What are the main purposes of the post-closing trial balance? *
To make sure all transactions have been correctly recorded in the general journal.
To verify that all the temporary or nominal accounts have zero balances.
To verify that only real accounts continue to have a balance in them and that the sum of all the debit
balances in the real accounts is equal to the sum of all the credit balances in the real accounts.
B and C.
All of the above.
The subtotals of the Income Statement debit and credit columns of the work sheet are $17,300
and $29,800, respectively. If the subtotal of the Balance Sheet Debit column is $12,800, what
should be the subtotal of the Balance Sheet Credit column? *
$15,300.
$10,300.
$300.
$2,500.
A total other than the choices shown.
Which of the following statements about the accounting cycle is false? *
Posting is done after transactions have been analyzed.

Preparing the post-closing trial balance is done after the temporary account have been closed.
Adjusting the accounts is done prior to preparing the adjusted trial balance.
Journalizing the transactions is performed before preparing the unadjusted trial balance.
Financial statements are prepared before preparing the adjusted trial balance.
Current assets total $120,000, plant and equipment assets $24,000, current liabilities $48,000,
and long-term liabilities $12,000. What is the current ratio of the business? *
1.0:1.
2.0:1.
2.5:1.
3.0:1.
None of the above.
Current assets total $240,000 and current liabilities total $120,000. The company pays off an
accounts payable of $30,000 with cash. How the does the current ratio change after the
transaction? *
It does not change.

It changes from 2.00:1 to 1.80:1.

Optional entries that transfer the balances in balance sheet accounts which arose as a result of
certain adjusting entries to income statement accounts is the definition for which term below? *
Adjusting entries.
Reversing entries.
Closing entries.
Declarations of cash dividends.
Payment of cash dividends.
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1/5/2019 Gmail - INTRODUCTORY MODULE P1- MC

Prince Guese <gueseprince128@gmail.com>

INTRODUCTORY MODULE P1- MC

Thanks for filling out INTRODUCTORY MODULE P1- MC

Here's what we got from you:

INTRODUCTORY MODULE P1- MC

Name (Last, First, MI) *

Laluon, Prince Ricky Lenard

Module Learning Objectives

After completing this module, you should be able to recall:

Introductory Module P1 Composition

This module has two (2) phases which are:

Review of Basic Accounting Process

if an amount paid for purchases is posted to Stationery account.

Which of the following errors will a trial balance fail to reveal? *

Salaries, an expense, has been stated in error as a credit balance.

A proprietorship employs one full-time accountant. This person is considered an employee. On

Debit, credit, credit.

Debit, debit, debit.

The trial balance is correct as it is.

The trial balance is correct as it is.

A debit to the Cash account for $325.

A debit to Accounts Payable for $325.

The Cash account is credited for $500.

The Unearned Sales Revenue account is debited for $500.

Withdrawals to be debited, an asset to be credited

A liability to be debited, an asset to be credited

An asset to be debited, a liability to be credited

One asset to be debited, another asset to be credited

An asset to be debited, a liability to be credited.

An asset to be debited, capital to be credited.

Which of the following statements is true? *

Revenue accounts are increased by debit entries.

Samuel Leonard, Capital.

Samuel Leonard, Withdrawals.

A debit to Accounts Receivable for $450.

A credit to Cash for $50.

A credit to Cash for $540.

Double-entry accounting requires which of the following? *

All journal entries must be posted twice.

Both B and C are correct.

Both of the accounts debited or credited are income statement accounts.

$1,800 and $2,400.

$900 and $1,200.

Understated, understated, understated, and understated.

Understated, no effect, overstated, and overstated.

Understated, no effect, overstated, and understated.

Cash, debit, $325; Accounts Receivable, credit, $325.

None of the above.

None of the above.

Ticket Revenue, debit, $12 million; Cash, credit, $12 million.

Monetary unit principle.

Expenses were overstated and assets were understated.

Expenses were overstated and assets were overstated.

None of the above.

Assets were understated and revenue was understated.

Liabilities were understated and revenue was understated.

Salaries Expense, debit, $4,250; Cash, credit, $4,250.

Salary Expense, debit, $2,000; Cash, credit, $2,000.

The going-concern principle and the cost principle.

The matching principle and the revenue recognition principle.

The conservatism principle and the cost principle.

None of the above.