De La Salle University, Inc. Ramon V. del Rosario - College of Business ACCTBA1 - Fundametals of Accounting 2 n d T e r m , A Y 2 0 12 -20 1 3
D o m i n g u e z ,C P A
A n s w e r S h e et
SCO RE
Name:
Test I and II
ID No.:
Test III
Section:
TOTAL
Test I Multiple Choice Choice Theories (10 points) points) - use scannable sheet sheet
Test II True or False False (10 points) - use scannable scannable sheet sheet
Test III Problem Problem Solving and Journalizin Journalizing g (30 points) - use worksheet.
De La Salle University, Inc. Ramon V. del Rosario - College of Business ACCTBA1 - Fundametals of Accounting Q3 - Adjustm ents
Do
INSTRUCTIONS TO THE EXAMINEE: 1 Only three (3) worksheets, calculator, ballpen ballpen and ruler are allowed at your desks. All others others should placed at the side/platform of the room. 2 The examination examination is good good for one and a half hours hours (1.5 hours). 3 Check the completeness and clarity of the questionnaire. questionnaire. 4 Read and follow instructions carefully. Ask questions only to the teacher. 5 You may write on any portion of the questionnaire. questionnaire. CHEATING is a MAJOR offense, MAJOR offense, as provided for in Section 13.3.1.1 of the Student Handbook. In ad 6 CHEATING is to the major offense, anybody caught cheating will automatically receive a FINAL GRADE of 0.0.
1
I. Multiple Choice Choice Theories: Theories: One (1) (1) point each. each. An accounting method in which revenue is recorded when it is earned and expenses expenses are recorded w they are incurred. a. Unearned revenue c. Cash basis of accounting b. Prepaid expenses d. Accrual basis of accounting
2
Adjusting entries normally involve a. real real account accounts s only b. nominal accounts accounts only c. real and and nominal nominal account accounts s d. neither neither real nor nominal nominal accounts accounts
3
The balance in an accrued revenue account represents an amount Earned Collected a. Yes Yes b. Yes No c No Yes
10
11
In writing off worthless receivables, the account to be debited should be a. Doubtful accounts expense c. Depreciation expense b. Allowance for doubtful accounts d. Accumulated depreciation II. True or False: False: One (1) point each. each. Shade A for true true and B for false. One company might depreciate a new com puter over three (3) years while another com pany might depreciate the samenew computer over five (5) years and both companies would not be violating any generally accepted accounting principle.
12
A fully depreciated asset has an accumulated depreciation that always always equals its depreciable cost.
13
Under the allowance method, writing off an uncollectible account affects both the Statement of Financial Position and the Income Statement.
14
Recovery of an accounts receivable previously written off increases Bad Debts Expense
15
Failure to adjust a prepayment recorded under the asset method causes total assets and total expenses to be overstated.
16
A one-year rent collected in advance on January January 1, 2012 and recorded under the nominal account method needs an adjusting entry at Decem ber 31, 2012.
17
Accrued interest income is a liability account
18
Accrued Rent Expense and Accrued Taxes Expense are liability accounts. accounts. a. I and II are true c. Only II is true b. Only I is true d. I and II are false
19
Accrued utilities expense is an income statement item
20
Accrued interest income is an income statement item
28
As of December 31, 2011, compute for/prepare: Depreciation Expense for Land Prudent Company applies the conservatism principle in accounting for its accounts receivable. It esti that its bad debts is at 5% of outstanding accounts receivable. The valuation account has a debit bal of P4,500 on June 30, 2011 before adjustment. During the natural business year, Prudent wrote off of unco uncoll llec ecti tibl ble e rece receiv ivab able les s and and reco recove vere red d P6,7 P6,750 50 from from acc accou ount nts s previ previou ousl sly y writ writte ten n off. off. Acco Accoun unts ts rec rec balance at June 30, 2011 is P987,600.
29 30
Provide the adjusting journal entry needed to recognize bad debts for t he current year. The net realizable value of Prudent's accounts receivable should be P________________. P________________. The following data are taken from the records of Jappi Calumpag Enterprises: Payments for rent during the year Accrued rent expense at the end of the year Prepaid rent expense at the end of the year
31
P
144,855 45,600 35,800
P
82,650 345,950 78,550
The amount of revenue that should be reported is P____________. The following data are taken from the records of Clarence Chua Enterprises: Accounts Receivable, beginning balance balance Collections from customers to apply on account Accounts Receivable, ending balance
33
160,000 15,000 25,000
The amount of rent expense that should be reported is P____________. The following data are taken from the records of Carl Chiang Enterprises: Collections from customers to apply on account Accrued income at the end of the year Unearned income at the end of the year
32
P
The amount of revenue that should be reported is P____________.
inguez, CPA
e
dition
en
mates nce 10,300 eivable
De La Salle University, Inc. Ramon V. del Rosario - College of Business ACCTBA1 ACCTBA1 - Fundametals of Accounting Dominguez, CPA
Q3 - Adjustments
nswer Key I. Multiple Choice Theories: One (1) point each.
II. True or False: One (1) point each.
1
D
11
A
2
C
12
A
3
B
13
B
4
B
14
B
5
B
15
B
6
B
16
B
7
D
17
B
8
B
18
A
9
C
19
B
10
B
20
B
III. Problem Solving and Journalizing: Journalizing: Two (2) points each. 21 22
9,000 Supplies
2 points
4,500
2 points
Supplies Expense 23 23
4,500
27,000 Salaries and W ages Expense
2 points
27,000
2 points
Accrued Salaries & Wages Expense/Salar Expense/Salar
27,000
P90,000 x 3 days / 10 days 25
P 120,000
2 points
2012 Depreciation Expense: 120,000
P620,000 - 20,000/ 5 years
26
Depr Deprec ecia iati tion on Expe Expen nse - Offi Office ce Equ Equipme ipmen nt
60,0 60,000 00
2 points
Accumulated Depreciation Depreciation - Office Equip Equip
60,000
2011 Depreciation Expense: P620,000 - 20,000/ 20,000/ 5 years x 6/12
27
P 320,000
2 points
Cost
620,000
Less: 2013 Accumulated Depreciation (P600,000 x 2.5 years)
300,000 320,000
28
P 0 zero
2 points
Value of land does not depreciate Allowance for for Doubtful Accounts Accounts 29
Bad Debts Expense Allowance Allowance for Bad Debts
57,430
4,500
2 points
57,430
10,300
6,750 57,430
30
938,220.00 =P 987,600 - 49,380
2 points
49,380
31
150,000
32
154,655
33
341,850
34
P 22,497.20
2
Ending bal., allowance for doubtful accounts
20,257
(P100,000 x 3%) Accounts Accounts Receivable P
Age of Accounts Accounts
% Uncollectibl Uncollectibl Uncollectible Uncollectible
109,200
Not yet due
1%
151,800
1-30 days due
3%
4,554.00
31,500
31-60 days due
6%
1,890.00
63,640
61-90 days due
8%
5,091.20
33,800
91-120 days due
10%
3,380.00
17,000
Over 120 days due
25%
4,250.00
P
20,257.20
406,940
1,092.00
Allowance Allowance for Doubtfu Doubtfull Accounts Accounts W rite-offs
-
Beginning balance
2,240
- Recoveries 22,497.20 Doubful Accounts Expense
20,257.20 Ending balance
35
P 10,697.20
2
Allowance Allowance for Doubtfu Doubtfull Accounts Accounts W rite-offs
-
9,560 Beginning balance
- Recoveries 10,697.20 Doubful Accounts Expense
20,257.20 Ending balance
