SET A

POLYTECHNIC UNIVERSITY OF THE PHILIPPINES

Business Management Accounting
Midterm Departmental Examination

NAME: ______________________________________________________ Course, Year & Section ______________ SCORE: _____________

Multiple Choice Questions. Encircle the letter of your answer. No erasures. No solution, no point.

1. All of the following are the basic functions of management except one

a. Decision b. Planning d. Controlling

making c. Organizing

2. A position that has authority to give commands or orders to subordinates

a. Treasurer b. Controller c. Line d. Staff

3. Under this function, management compares actual performance with set plans or standard and
deciding what corrective actions to take should there be any deviations between actual and planned
performance.

a. Decision making b. Planning c. Organizing d. Controlling

4. The percentage change in total assets between two balance sheet dates is an example of ________ analysis

a. Vertical b. Horizontal c. Capital d. Profitability

5. Ratios are most useful in identifying

a. Trends b. Differences c. Causes d. Relationships

6. The inventory turnover is calculated by dividing

a. Cost of sales by ending inventory c. Cost of sales by average inventory

b. Sales by ending inventory d. Sales by average inventory

7. The current ratio is

a. Calculated by dividing current liabilities by current assets
b. Used to evaluate a company’s liquidity and short-term debt paying ability
c. Used to evaluate a company’s solvency and long-term debt paying ability
d. Calculated by subtracting current liabilities from current assets

8. It is the assumed range of activity, which reflects the company’s normal operating levels where the
relationship of cost behavior is assumed valid.
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a. Activity b. Cost Driver c. Relevant Range d. Cost Behavior

9. A cost that remains unchanged, in total, as the level of activity varies within the relevant range.

a. Fixed b. Mixed c. Variable d. Cost per unit

10. A cost that the manager can significantly or heavily influence its incurrence.

a. Direct b. Indirect c. Controllable d. Non-controllable

11. Assume the following sales data for a company:

2017 P1,000,000
2016 900,000
2015 750,000
2015 600,000
If 2015 is the base year, what is the percentage increase in sales from 2015 to 2016?

a. 125% b. 167% c. 25% d. 20%

12. A company had a balance in the Accounts Receivable account of P578,000 at the beginning of the year
and a balance of P682,000 at the end of the year. Net credit sales during the year amounted to
P4,410,000. The receivable turnover ratio was

a. 7.1 times b. 7.3 times c. 7.5 times d. 7 times

13. A company has a receivables turnover ratio of 9.25. The average net receivables during the period are
P100,000. What is the amount of net credit sales for the period?

a. P92,500 b. P925,000 c. P10,811 d. P108,108

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14. A company has an average inventory on hand of P60,000 and its average days is 29.2 days. What is the
cost of sales?

a. P750,000 b. P1,752,000 c. P1,680,000 d. P876,000

15. A company has a balance in the Accounts Receivable account of P2,050,000 at the beginning of the year
and a balance of P1,950,000 at the end of the year. Net credit sales during the year amounted to
P7,300,000. The average collection period of the receivables in terms of days was

a. 30 days b. 365 days c. 100 days d. 50 days

16. The information shown below was taken from the company’s financial statements:
Cash P40,000
Accounts Receivable 19,000
Accounts Payable 100,000
Inventory 80,000
Accrued Expenses 2,000

What is the current ratio for this company?

a. 1.39: 1 b. 1.38: 1 c. 1.36:1 d. 1.34:1

For number 17-20- ABC Company accumulates the following data concerning a mixed cost, using factory
machine hours as the activity level.

Month Factory Total Power

Machine Cost
Hours
January 500 P60,000
February 600 P80,000

March 700 P70,000

April 800 P50,000
May 900 P95,000
17. How much is the variable cost per unit?

a. P87.50 b. P90.50 P100.50 c. P112.50

SET A

18. How much is the total fixed cost portion?

a. P16,250 b. P14,750 c. P9,750 d. P3,750

19. What is the cost function/formula?

a. Y=P16,250 + 87.50X c. Y=P9,750 + 100.50X

b. Y=P14,750 + 90.50X d. Y=P3,750 + 112.50X

20. What is the estimated if the level of activity expected for June is 1,000 factory machine hours?

a. P103,750 b. P105,250 c. P110,250 d. P116,250