Basic Acctg Practical

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Course/Year & Section: Date:
I. Multiple Choice. Encircle the letter of the best answer.

1. At the beginning of the year, the liabilities of NAKAKAIRITA Service station amounted to P120,000 but it decreased by
P50,000 during the year. The assets increased by P160,000 during the year and at the end of the year amounted to P360,000.
The owner’s equity at the start of the year is
a. P160,000 b. P80,000 c. P240,000 d. P260,000 e. P200,000
2. The assets of the business at the start of the month is P1,000,000 and the owner’s equity is P800,000. Equipment worth
P500,000 were purchased during the month of which only P150,000 were paid for. At the end of the month, liabilities will
become
a. P550,000 b. P1,150,000 c. P800,000 d. P1,000,000
3. KAMAHALAN Nature Trip, a travel agency, purchased equipment for P120,000 made a down payment of P50,000 and
signed a note for the balance. This transaction will
a. increase total assets by P120,000
b. increase total liabilities by P50,000
c. not affect owner’s equity
d. all of the above choices are correct
4. On January 1, the assets were P500,000 and the liabilities were P200,000. During the year the assets increased by P100,000
and the liabilities decreased by P50,000. Owner’s equity on December 31 was:
a. P300,000 b. P350,000 c. P250,000 d. P450,000
5 to 8 are based on the following:

You are given the following selected data after one year of operation of KAYPANGIT Face Control:
Revenue from facial treatment services collected in cash P250,000

Revenue from facial treatment services rendered on account 125,000
Cash collected from account customers 50,000
Dr. Protacia, Capital as of January 1 520,000
Operating expenses incurred on account 125,000
Operating expenses incurred for cash 75,000
Cash withdrawn by Dr. Protacia 25,000
Additional equipment invested by Dr. Protacia 150,000
Cash paid to account creditors 100,000
5. Total Treatment Fees amounted to:

a. P375,000 b. P250,000 c. P425,000 d. P50,000
6. Total Operating Expenses amounted to:

a. P175,000 b. P200,000 c. P225,000 d. P300,000
7. Her capital at year-end is:

a. P925,000 b. P670,000 c. P820,000 d. P720,000
8. Cash inflow from operating activities amounted to:

a. P300,000 b. P125,000 c. P225,000 d. P200,000
9. The trial balance shows supplies of P1,350. If P350 are on hand at the end of the accounting period, the adjusting entry is
a. Supplies 350
Supplies Expense 350
b. Supplies 1,000
Supplies Expense 1,000
c. Supplies Expense 350
Supplies 350
d. Supplies Expense 1,000
Supplies 1,000
10. Atty. MAALINDOG incurred P2,500 salary for the last week of December 2010 but this will paid on January 2011. The
adjustment on December 31, 2010 is:
a. No adjustment is needed
b. Salaries Expense 2,500
Salaries Payable 2,500
c. Salaries Expense 2,500
Cash 2,500
d. Salaries Payable 2,500
Cash 2,500
11. Prepaid Advertising of P7,200 represents payment made on 24 monthly magazine issues starting October 1, 2010. The
adjustment on December 31, 2010 is:
a. Advertising Expense 900
Prepaid Advertising 900
b. Advertising Expense 4,500
Prepaid Advertising Expense 4,500
c. Advertising Expense 3,600
Prepaid Advertising 3,600
d. Prepaid Advertising 3,600
Advertising Expense 3,600
12. This is prepared after making the closing entries, again to prove the equality of the debits and the credits.
a. Adjusted Trial Balance c. Financial Statements
b. Post-Closing Trial Balance d. Accounting Equation
13. The company’s assets are P9,000,000 of which 1/3 represents liabilities. How much is total owner’s equity?
a. P3,000,000 b. P6,000,000 c. P1,500,000 d. P2,700,000
14. These are the accounts that must always be closed every accounting period.
a. Revenues c. Owner’s Drawing
b. Expenses d. All of the above
15. Adjusting entries are made to ensure that

a. Balance sheet, income and expense accounts have correct balances at the end of the accounting period.
b. Revenues and expenses are recognized in the period in which they are earned and incurred.
c. , Part of the asset that has been used up is recognized as expense.
d. All of the above.
II. From the following information, prepare the income statement, statement of changes in equity and statement of financial
position as at Dec. 31, 2010 for NAKAKAPAGPABAGABAG Billiard Hall owned and operated by Cora Ann Basang-
Basa:
Accounts payable 12,500.75
Accrued office expenses 32,652.25
Accrued rent expense 12,000.00
Advances from clients 10,000.00
Amortization – Leasehold improvements 3,570.00
Cash in bank 65,780.72
Cora Ann Basang-Basa, Capital 100,000.00
Cora Ann Basang-Basa, Personal 60,000.00
Depreciation – Furniture and fixtures 3,200.00
Depreciation – Office equipment 5,200.00
Furniture and fixtures 120,800.00
Leasehold improvements 45,000.00
Loan payable 200,000.00
Membership expense 12,000.00
Miscellaneous expenses 3,781.36
Miscellaneous income 13,392.79
Office equipment 150,000.00
Other prepaid expenses 900.00
Petty cash fund 10,000.00
Prepaid taxes 2,450.00
Professional fees 350,000.00
Professional fees receivable 22,750.00
Rent expense 36,000.00
Repairs and maintenance 1,250.00
Representation and entertainment 23,452.50
Salaries and wages 75,000.00
Supplies used 12,635.55
Taxes 25,000.00
Taxes payable 3,685.00
Transportation and travel 21,860.00
Unused office supplies 12,850.00
Utilities 20,750.66
III. Write each of the transaction below in a 2-column journal.
May 1 Teresa KATULO-TULO, a doctor, invested P100,000 cash and a medical equipment worth
P500,000 to put up a clinic.
5 Purchased furniture worth P20,000 from NAGTUTUBIG furnishing Home. Paid 50%, the balance on credit for
thirty days.
6 Hired a nurse for a monthly salary of P10,000.
8 Withdrew cash from the business funds to purchase medical supplies needed by the business, P5,000.
9 Purchased a car for personal use, paid P50,000 from her personal cash and issued a promissory note for P150,000
10 Applied for a business loan from a bank. Signed a promissory note for P100,000.
17 The loan was approved and a check was received from the bank.
20 One half of the loan was used for the improvement of the clinic.
21 Returned a defective chair purchased on May 5. Received a credit memo reducing the account by P1,500.
24 Purchased electronic equipment worth P75,000 in cash.
IV. The trial balance of Diana SOHOT, Interior Decorator, for December 31, 2010 appears below:
Diana SOHOT, Interior Decorator

Trial Balance
December 31, 2010
101 Cash P186,000

103 Accounts Receivable 71,200
104 Prepaid Rent 19,200
105 Equipment 177,500
105-A Accumulated Depreciation – Equipment P 5,500
201 Accounts Payable 18,000
204 Notes Payable 12,000
301 SOHOT, Capital 300,000
302 SOHOT, Drawings 19,000
401 Professional Fees 276,300
501 Salaries Expense 84,100
502 Supplies Expense 17,000
503 Utilities Expense 37,800
Totals P611,800 P611,800
Additional data:
a. Prepaid rent is for the period October 1, 2010 to May 31, 2011.
b. Depreciation rate on the equipment is 5% per year. Scrap value of P35,000. Hint: Formula-Equipment value less Scrap value
equals Book value multiply Percentage of Depreciation equals Depreciation for the year.
c. Salaries incurred but unpaid as of December 31, P12,000.
d. The note was issued on December 11 for 30 days at 12%.
e. Provision for bad debt is 5% of the outstanding accounts of customers.
f. Supplies on hand, P5,000.
Required: Prepare Step 5-10 of the accounting cycle.

Use the following accounts in adjusting:
504 Rent Expense 102 Supplies
505 Depreciation Expense-Equipment 103-A Allowance for Bad Debts
506 Interest Expense 202 Salaries Payable
507 Bad Debts Expense 203 Interest Payable
303 Income Summary

Basic Acctg Practical

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Name: Score:

Course/Year & Section: Date:

I. Multiple Choice. Encircle the letter of the best answer.

5 to 8 are based on the following:

Revenue from facial treatment services collected in cash P250,000

5. Total Treatment Fees amounted to:

6. Total Operating Expenses amounted to:

7. Her capital at year-end is:

8. Cash inflow from operating activities amounted to:

15. Adjusting entries are made to ensure that

Diana SOHOT, Interior Decorator

101 Cash P186,000

Required: Prepare Step 5-10 of the accounting cycle.

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