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58 Questions

A transaction that causes an increase in asset may also cause

A partnership is not a separate legal entity from the partners themselves

The financial statement that reports whether the business earned a profit and also lists the revenues and expenses is called:

Partners are personally liable for any debts incurred by the partnership.

The Maxim Company acquired a building for P500,000. Maxim had the building appraised, and found that the building was easily worth P575,000. The seller had paid P300,000 for the building 6 years ago. Which accounting principle would require Maxim to record the building on its records at P500,000?

The following data were taken from the records of Arizona Corporation for the year ending December 31, 2022:

                     01/01/22     12/31/22

Assets 11,250 ? Liabilities 8,580 10,365 Equity ? 6.465

If equity is 300,000 and liabilities are 192,000, then assets equal:

The idea that the activities of the entity are separate from those of the individual owner is the

The basic accounting equation is

The accounting assumption that requires every business to be accounted for separately from other business entities, including its owner or owners is known as the:

A sole proprietorship is a type of business organization owned by its stockholders

Financial statements for the partnership is by law must be produced and made public

Increases in equity from a company's earning activities are:

What is the primary purpose of accounting?

The idea that transactions are recorded at their exchange prices at the transaction date is referred to as the

To include personal assets and transactions of a business owner in the records and reports of the business would be in conflict with the:

Which of the following is NOT one of the four primary financial statements?

Under this principle, the effects of transactions and other events are recognized when they occur and they are recorded in the accountings records statements of the periods to which they relate

The accounting concept that requires financial statement information to be supported by independent, unbiased evidence other than someone's belief or opinion is:

These are attributes that make the information provided in the financial statements useful to users

Which of the following is not a form of business organization?

The rules that requires financial statements to reflect the assumption that the business will continue operating instead of being closed or sold, unless evidence shows that will not continue, is the:

Economic resource that are owned or controlled by an enterprise are called

On June 30 of the current year, the assets and liabilities of Hana Beshie, Inc. are as follows: Cash P250,00; Accounts Receivable P7,250; Supplies P650; Equipment P12,000; Accounts Payable P9,300. What is the amount of owner's equity as of July 1 of the current year?

The partners' individual exposure to debt is limited.

What is the primary purpose of accounting?

In a sole proprietorship, who owns and manages the business?

What is the main advantage of a partnership over a sole proprietorship?

Which accounting principle requires expenses to be recorded in the period they are incurred, regardless of when the cash is paid?

Which financial statement reports the financial position of a business at a specific point in time?

Which of the following is a current liability?

What is the purpose of the income statement?

Which accounting principle dictates that revenue should be recognized when it is earned, regardless of when the cash is received?

What is the purpose of the statement of cash flows?

Which financial statement is also known as the statement of changes in equity?

What is the purpose of the double-entry accounting system?

Which of the following is a long term liability

What is the main purpose of the statement of retained earnings?

What is the accounting principle that requires a company to use the same accounting methods and procedures from period to period?

Which financial statement is prepared first during the accounting cycle

What is the purpose of adjusting entries in accounting?

which of the following is an example a contra-asset account?

what is the purpose of the trial balance in accounting?

The primary purpose of accounting is to provide information for marketing analysis

A sole proprietorship is a form of business organization with multiple owners

In a partnership, each partner has limited liability for the business debts

The matching principle requires revenues to be recorded when they are earned, not when the cash is received

The accounting equation is Assets = Liabilities - Equity

The income statement reports the financial position of a business at a specific point in time

Notes payable is an example of a current liability

The purpose of the statement of cashflows is to show changes in equity over a specific period

The revenue recognition principle dictates that revenue should be recognized only when cash is received

The double-entry accounting system ensures that the accounting equation is always out of balance

Accrued expenses are long-term liabilities

The statement of retained earnings shows the financial position of a business at a specific point in time

Adjusting entries are made to reconcile bank statements

Accumulated depreciation is an example of a contra-asset account

The trial balance is prepared to calculate taxes owed


Test your knowledge about accounting transactions that result in an increase in assets and their corresponding effects on other elements of the balance sheet.

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