Republic of the Philippines

Department of Education
Region III
Division of Nueva Ecija
CUYAPO NATIONAL HIGH SCHOOL
Brgy. Bulala, Cuyapo, Nueva Ecija

FIRST QUARTER EXAMINATION

FUNDAMENTALS OF ACCOUNTANCY,BUSINESS AND MANAGEMENT II
First Semester 2019-2020 (First Quarter)

Name:____________________ Score:_____________________
Section: __________________ Date: _____________________

PART 1: Multiple Choice.

Direction: Encircle the correct answer
1. These result primarily from transactions that affect income and expenses.
a. Cash flows from operating activities
b. Cash flows from investing activities
c. Cash flows from financing activities
d. Any of these
2. Which of the following is a cash flow that is presented in the operating activities section of a statement of cash
flows?
a. Cash receipts from sales of property, plant and equipment
b. Cash receipts from investments of owner to the business
c. Cash payments on drawings by owner
d. Cash receipts from sales of goods
3. Which of the following is a cash flow that is presented in the investing activities section of a statement of cash
flows?
a. Cash paid for purchases of inventory
b. Cash receipts on loans taken from a bank
c. Cash payments for the acquisition of property, plant and equipment
d. Cash paid for salaries expense
4. Which of the following is a cash flow that is presented in the financing activities section of a statement of cash
flows?
a. Cash paid for utilities expense
b. Cash paid for interest expense
c. Repayment of a loan taken from a bank
d. Sale of inventory on account
5. These result primarily from transactions with the owner and from borrowings.
a. Cash flows from operating activities
b. Cash flows from investing activities
c. Cash flows from financing activities
d. Any of these
6. This method of presenting cash flows shows each major class of gross cash receipts and gross cash payments.
a. Direct method
b. Indirect method
c. Single-step method
d. Unclassified presentation method
7. How is depreciation expense presented in the operating activities section of a statement of cash flows prepared
using the indirect method?
a. Added to accrual basis profit
b. Deducted from accrual basis profit
c. Multiplied to accrual basis profit
d. Not presented

8. Entity A reported profit of ₱340,000 for the year ended December 31, 20x1. Depreciation expense for the year
was ₱100,000. The following are the changes in the operating assets and liabilities of Entity A during 20x1:

20x1 20x0
Accounts receivable 560,000 300,000
Accounts payable 240,000 120,000

How much is the net cash from operating activities?

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 a. 820,000 c. 300,000
b. 580,000 d. 100,000

Use the following information for the next two questions:

The following were the cash transactions of Entity A during the period:

Cash receipts from sale of goods 650,000

Cash paid for purchases of inventory 340,000
Cash receipts on loans taken from a bank 200,000
Cash paid for interest expense 20,000
Cash payment for the acquisition of property, plant and equipment 180,000

9. How much is the net cash from (used in) operating activities?
a. 155,000 c. 290,000
b. (155,000) d. (290,000)

10. How much is the net cash from (used in) investing activities?
a. 180,000 c. 20,000
b. (180,000) d. 0

11. Which of the following is considered revenue?

a. Gain on sale of equipment c. Other income
b. Service fees d. Other comprehensive income

12. The statement of financial position does not show information on an entity’s
a. Owner’s equity c. Inventories
b. Cash and cash equivalent d. Revenues

13. The following are terms synonymously with equity except

a. Capital c. Net worth
b. Net Assets d. Revenue

14. The following are examples of current assets except

a. Prepaid Insurance c. Land
b. Cash d. Trade receivables

15. The heading of financial statement most likely will not include
a. The name of the reporting entity
b. The title of the financial statement
c. The date of the financial statement
d. The name(s) of the business owner(s)

Part II. Fill in the blanks with the correct answers. Choose the letter of your answers from the box. All answers
should be in capital letters.

A. Real Accounts F. Losses K. Gains

B. Cash G. Service fees L. Sales
C. Contra Sales H. Financial Statements M. Non-current assets
D. Contra Purchase I. Current Assets N. Income
E. Account Form J. Report Form O. Revenues

____________16. Are revenues earned by a merchandising business from selling goods.

____________17. Are accounts that decrease the sales account.
____________18. Are accounts in the general ledger that do not close at the end of the accounting year because there
are balances retained in the account.
____________19. Kinds of expenses from other activities of the business.
____________20. Form of SFP is also known as horizontal balance which consist of two columns.
____________21. Are Assets of an entity that are not likely to be realized within a year.
____________22. It is one of the most common current assets.
____________23. Form of SFP which is also known as vertical balance which consist of one column.
____________24. It refers to revenue earned by a service business from rendering services.
____________25. Are accounts that decrease the purchase account.
____________26. Are income derived from other activities of the business.
____________27. It is the increase in the economic benefits of the entity that may be a result of enhancement or
inflow of asset or such decrease in the liability that cause equity to increase.
____________28. Are income generated from the primary operations of the business.

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____________29. Are assets of an entity that can be converted within one year of the normal operating cycle of
business.
____________30. These are the end products of the accounting system in any company for one operating cycle.

Part III. Problems. Presented below are accounts of NuBear Merchandising for December 31, 2017.

Cash P ?
Account Receivable ` 59,400
Allowance for Bad Debts 5,000
Notes Receivable 39,600
Interest Receivable 5,000
Merchandise Inventory 247,500
Prepaid Insurance 6,000
Office Supplies 30,000
Delivery Equipment 225,000
Accum.Dep-Delivery Equipment 72,000
Furniture and Fixtures 180,000
Accum. Dep.-Furniture & Fixtures 67,500
Accounts Payable 45,000
Accrued Expenses 8,000
Notes payable (due in 3 years) 105,000
N, Capital ?
N,Drawing 50,000

During the year, the owner made an additional investment of P 20,000 and withdrawals amounting to
50,000. N, capital beginning is P 617,600. Net income for the year is P 75,000.

Required: 1. Prepared the SFP and determine the amount of cash. (10 points)
2. Prepare the Statement of Changes in Owners Equity (SoCE). (10 points)

“Striving for success without hard work is like trying to harvest where you haven’t planted”. David Bly
Good luck!!!

Prepared by: Checked by: Noted by:

RAUL S. CABANTING LEONIDA H. ZAMORA ANGELITA L. DELA FUENTE

Teacher II ASP II School Principal

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PRO-FORMA STATEMENT

Cash flows from operating activities:

PROFIT FOR THE YEAR
Non-cash items:
Depreciation
Loss on sale of equipment
Total
Changes in operating assets & liabilities:
Increase in Trade and other receivables
Decrease in inventory
Decrease in prepaid assets
Increase in Trade and other payables
Net cash from operating activities

Cash flows from investing activities:

Cash proceeds from sale of equipment
Cash paid for the acquisition of equipment
Net cash used in investing activities

Cash flows from financing activities:

Cash payments to owner
Net cash used in financing activities

Net increase in cash and cash equivalents

Cash and cash equivalents, beginning
Cash and cash equivalents, ending

“If you think education is expensive, try ignorance.” —Robert Orben

- END -
SOLUTION TO QUIZ 2:

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 Entity A
Statement of Cash Flows
For the period ended December 31, 20x1

Cash flows from operating activities:

PROFIT FOR THE YEAR 120,000
Non-cash items:
Depreciation 240,000
Loss on sale of equipment 40,000
Total 400,000
Changes in operating assets & liabilities:
Increase in Trade and other receivables (10,000)
Decrease in inventory 360,000
Decrease in prepaid assets 120,000
Increase in Trade and other payables 60,000
Net cash from operating activities 930,000

Cash flows from investing activities:

Cash proceeds from sale of equipment 200,000
Cash paid for the acquisition of equipment (800,000)
Net cash used in investing activities (600,000)

Cash flows from financing activities:

Cash payments to owner (90,000)
Net cash used in financing activities (90,000)

Net increase in cash and cash equivalents 240,000

Cash and cash equivalents, beginning 200,000
Cash and cash equivalents, ending 440,000