SPECIAL QUIZ

FUNDAMENTALS OF ABM 2
STATEMENT OF FINANCIAL POSITION
TRUE OR FALSE: Write TRUE if statement is correct otherwise write FALSE.
Point system: (2 points for correct answer. Minus 1 for Wrong answer. No point for no answers)
1. Trade receivables are receivables arising from the purchase of inventory that are sold in the ordinary
course of activities of the business.
2. A constructive obligation arises from future business practices or published policies that have
created a valid expectation on the part of customers that you will pay them.
3. Some receivables are presented as current even if they are collected or paid more than 12 months.
4. The unclassified presentation of Statement of Financial position shows information on the distinction
between the current and non current assets and liabilities.
5. Assets, liabilities, and Equity may be classified as current and non- current.
Define the following terms: (2 points each)
6. Assets –

7. Liabilities –

8. Equity –

9. Report Form –

10. Account Form –

ENUMERATION:
11. LINE ITEMS UNDER CURRENT ASSETS (4 POINTS)
12. ELEMENTS OF SOFP (3 POINTS)

ESSAY: (3 POINTS)
A friend of the family has just received her first set of financial statements from her accountant. When she
finds out that you are an ABM student, she asks you the following question:
“Why aren’t my employees listed as an asset on my company’s balance sheet?”

Include in your discussion the primary reason why “human resources” are not recognized as assets.

Prepared by:
AR-JAY C. ROMERO
PROBLEM SOLVING
AngPoJhayCo. Post closing trial balance show:
Cash P50, 000 Accounts Payable P80, 000
Accounts Receivable 30, 000 Notes Payable (nontrade) 300, 000
Notes Receivable(nontrade) 70, 000 (P50, 000 due in 1 yr)
-P45, 000 due in one year
Inventory 55, 000 Rent Payable(due 1 yr) 50, 000
Prepaid Supplies 15, 000 Utilities Payable 35, 000
Land 300, 000 Interest Payable 30, 000
Building 700, 000 Salaries Payable 60, 000
Acumulated Depreciation 360, 000 Unearned Income 130, 000
13. What is the total amount of company’s current assets?
a. P220, 000 b. P195, 000 c. P205, 000 d. P180, 000
14. What is the total amount of the company’s noncurrent assets?
a. P1, 360, 000 b. 1, 385, 000 c. P665, 000 d. P640, 000
15. What is the total amount of current liabilities?
a. P305, 000 b. P435, 000 c. P555, 000 d. P685, 000
16. What is the total amount of noncurrent liabilities?
a. P250, 000 b. P300, 000 c. P350, 000 d. P130, 000
17. What is the total amount of company’s equity?
a. P860, 000 b. 685, 000 c. P175, 000 d. P605, 000

AngPoJhayPoJhayCo. Talaga Inc Post closing trial balance show:

Cash on hand P10, 000 Accounts Payable P35, 000
Cash in Bank 50, 000
Accounts Receivable 70, 000 Notes Payable (nontrade) 65, 000
Notes Receivable(nontrade) 60, 000 (P20, 000 due in 1 yr)
-P15, 000 due in one year
Allowance for bad Debts 5, 000
Inventory 40, 000
Prepaid Supplies 15, 000 Utilities Payable 45, 000
Prepaid rent 25, 000
Prepaid Insurance 35, 000
Land 600, 000 Interest Payable 20, 000
Equipment 300, 000
Acumulated Dep’n- Equipment 50, 000
Building 800, 000 Salaries Payable 80, 000
Acumulated Dep’n- Bldg 360, 000 Unearned Income 150, 000
18. What is the company’s cash and cash equivalent?
a. P75, 000 b. P120, 000 c. P60, 000 d. P120, 000
19. What is the total amount of company’s trade and other receivables?
a. P125, 000 b. P80, 000 c. P130, 000 d. P85, 000
20. What is the total amount of company’s prepaid assets?
a. P115, 000 b. P75, 000 c. P110, 000 d. P70, 000
21. What is the total amount of company’s property, plant and equipment?
a. P1, 480, 000 b. P1, 700, 000 c. P1, 650, 000 d. P1, 430, 000
22. What is the total amount of company’s trade and other payables?
a. P350, 000 b. P300, 000 c. P395, 000 d. P375, 000