FABM2 - First Summative

2ND SEMESTER- FIRST QUARTER Score:
`1ST Summative Test in Fundamentals of Accountancy, Business and Management 2 _____________

Parent’s Signature
NAME: _______________________________________________________
________________
Year & Section: _____________________ DATE: _____________
Direction: Read and understand each item very carefully. Then, encircle the letter of the correct answer.
1. A statement of financial position can be best described as a:

A. Listing of money received and paid during the past year
B. Summary of what happened last year
C. Summary of all assets, expenses, liabilities, and revenues
D. Summary of the position of an organization
2. An asset is an
A. Expense that will recur in more than one year
B. Obligation to transfer benefits as a result of past transactions
C. Interest of the owner in the business
D. Any financial resources that is used by the business in its operation
3. The Statement of Financial Position equation is:
A. A-C=L B. L+C=A C. A-L=C D. all of the choices
4. Which of the following accounts is a current asset?
A. Bond Payable C. Notes payables
B. Property, Plant and Equipment D. Accounts receivables
5. Which of the following transactions would increase cash as well as non-current liabilities?
A. Long-term bank loan C. Payment to suppliers
B. Purchasing equipment on credit D. Payment from customers
6. Which of the following accounts is a current liability?
A. Trade receivables C. Trade Payables
B. Retained Earnings D. Machineries
7. XYZ Company have non-current assets of P 60,000, current assets of P 70,000, current liabilities of P 40,000,
and a long-term loan of P 50,000; as such the owner’s equity will be:
A. P 40,000 B. P 50,000 C. P 60,000 D. P 70,000
8. This is a financial statement that informs the reader about the “performance” and activities of the company for
a certain period.
A. Statement of Comprehensive Income C. Statement of Changes in Equity
B. Statement of Financial Position D. Statement of Cash Flow
9. This is typically the date of the statement of comprehensive income?
A. “As of December 31, 2019” C. Either A or B
B. “For the period ended December 31, 2019” D. None of the above
10. Which of the following is an element of a Statement of Comprehensive Income?
A. Sales C. Notes Receivable
B. Accounts Payable D. Capital
11. Which of the following is an element of a Statement of Comprehensive Income?
A. Prepaid Insurance C. Furniture and Fixture
B. Gross Profit D. Equipment
12. Which of the following is classified as selling expenses?
A. Salaries of the president C. Depreciation of administration building
B. B. Salaries of sales executives D. Depreciation of office equipment
13. What is the outcome when the Revenue is subtracted by the expenses?
A. Gross Income C. Loss Income
B. Net Income D. Gain Income
14. Freight In is________________.
A. This account is used to record transportation costs of merchandise purchased by the company.
B. This account is used to record transportation costs of merchandise bought by the company.
C. The amount of inventory presented in the Statement of Financial Position.
D. The amount of goods bought during the current accounting period
15. What is the last step in preparing SCI using Multiple -Step Approach
A. Determine the revenues
B. Determine the Net Purchases, Cost of Sales and Gross Profit
C. Determine the Administrative and Operating Expenses
D. Determine the Net Income
16. Which of the following is classified as selling expenses?
A. Salaries of corporate executive C. Depreciation of corporate headquarters
B. Salaries of salesman d. Depreciation of automobile
17. Which of the following is only ancillary to the entity’s operation?
A. Professional fees charged by a law firm
B. Sales revenue earned by a variety store
C. Sales revenue earned by a department store
D. Gain on sale of property, plant and equipment.
[23-24] Refer to the partial trial balance of Tee Shirts Company below;
18. What is the net sales for the year?

A. P 14,870,000.00 C. P 6,530,000.00
B. P 8,340,000.00 D. P 4,560,000.00
19. What is the income for the year?
A. P 14,870,000.00 C. P 6,530,000.00
B. P 8,340,000.00 D. P 4,560,000.00
20. Which of the following is a major type of business organization??
A. Sole Proprietorship C. Corporations
B. Partnership D. All of the above
21. How many is considered owner(s) of a sole proprietorship?
A. One C. Two but not more than five
B. More than one D. Five and above
22. How are owners of a sole proprietorship called?
A. Sole proprietors C. Shareholders/Stockholders
B. Partners D. None of the above
23. How are owners of a partnership called?
24. How are owners of a corporation called?
25. Which of the following sequences arranges the complexity of business organizations, from simple to complex?
A. Partnership, Sole Proprietorship, Corporation
B. Corporation, Sole proprietorship, Partnership
C. Sole Proprietorship, Corporation, Partnership
D. Sole Proprietorship, Partnership, Corporation
26. Which of the following is the most appropriate business organization for an entity named “Segismundo,
Gomez, Valencia, & Co., CPA’s”?
A. Sole Proprietorship C. Corporation
B. Partnership D. None of the above
27. How does partnership differ from sole proprietorship?
A. It has more source of expertise C. limited existence
B. Unlimited liability D. None of the above

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2ND SEMESTER- FIRST QUARTER Score:

`1ST Summative Test in Fundamentals of Accountancy, Business and Management 2 _____________

1. A statement of financial position can be best described as a:

18. What is the net sales for the year?

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