Midterm-Adit-probs-set-a
.docx
School
Central Philippine University - Jaro, Iloilo City**We aren't endorsed by this school
Course
ACCOUNTACY BABM
Subject
Accounting
Date
Dec 18, 2024
Pages
4
Uploaded by EarlSeahorseMaster282
HUA SIONG COLLEGE OF ILOILO Accountancy DepartmentPrelim ExamAssurance and Auditing Concepts and ApplicationsName:________________________________________________________________ Date:_____________Multiple Choice. Encircle the letter of the correct answer. No erasures allowed1. What account is recorded in lieu of a nominal account for adjustments in prior period errors?A. Retained EarningsB. Income summaryC. Expense/revenue accountD. None of the above2. What is the normal balance of merchandise inventory account?A. DebitB. Both debit and creditC. CreditD. None of the above3. A double recording of purchases shall be corrected by the following entry:A. Debit to purchasesB. Credit to purchasesC. Debit to retained earningsD. None of the above4. It is done at the end of the period to find the ending balance of the merchandise inventory.A. TracingB. Reconciling of Ledgers C. Inventory countD. None of the above5. A recording of freight in as an expense shall have an adjusting entry of ______ in the current period.A. Debit to Retained EarningsB. Credit to Retained EarningsC. Debit to Merchandise InventoryD. None of the above6. Finding unrecorded purchases relates to what assertion?A. ExistenceB. CompletenessC. ValuationD. None of the above7. Double recording of cash sales will result to understatement of _______.A. Retained EarningsB. SalesC. CashD. None of the above8. These are errors that was detected after the books was closed.A. Common errorsB. Prior period errorsC. MisstatementsD. None of the above9. Recording of cash sales as sales on account will result to?A. Overstatement of cashB. Overstatement of salesC. Understatement of salesD. None of the above10. It is the beginning balance of merchandise inventory.A. TGAS less COGSB. Ending balance of merchandise inventory on the previous periodC. All purchases less salesD. None of the above11-20 Determine the effect of the following prior period errors to the Retained EarningsA. UnderstatementB. OverstatementC. No effectD. None of the above11. Non recording of payment of receivable.12. Non recording of payment of payables.13. Non recording of interest on discounting of notes receivable.14. Double recording of cash sales.15. Double recording of sales on account.16. Recording sales on account as cash sales.17. Understatement of ending inventory.18. Overstatement of Cost of goods sold.19. Non recording of additional allowance for doubtful accounts.20. Non recording of recovery of written off accounts receivable.___________________________________________________________________________________________Prepared by:Jesrelle Vhon HabanaInstuctor
HUA SIONG COLLEGE OF ILOILO Accountancy DepartmentPrelim ExamAssurance and Auditing Concepts and ApplicationsName:________________________________________________________________ Date:_____________21-40. The following are the beginning balance of AC company for 2024:Cash300,000Accounts Receivable500,000Allowance for Doubtful Accounts1,000Notes Receivable100,000Merchandise Inventory450,000Accounts Payable80,000Retained Earnings800.000During your audit, you have found the following errors on 2023:1. A cash sale amounting to 50,000 was not recorded. The cost of the inventory sold was 40,000 and was not included in the inventory count.2. The Allowance for doubtful accounts should be 5% of the ending accounts receivable.3. A note receivable amounting to 30,000 was discounted. It was recorded as a debit to cash of 25,000 and 5,000 to loss on notes receivablediscounted and credited to notes receivable discounted 30,000. The accrued interest for the note was 3,000.4. A merchandise inventory of 10,000 purchased with the terms FOB shipping point was not included in the ending inventory. The inventory wasshipped on December 29 and the purchase was recorded on December 30. The merchandise arrived on January 2.5. A merchandise inventory was lost during a flood but it was included in the inventory count. The cost of the inventory is 15,000 and the selling pricewas 25,0006. A purchase on account was recorded as cash purchases amounting to 40,000.7. A sale on account amounting to 50,000 with the terms FOB Destination was recorded last year but the inventory was only delivered in 2024. Themerchandise costs 30,000 and was not included in the inventory count.8. A payment of accounts payable amounting to 10,000 was recorded at 20,000.9. During the bank reconciliation, the bank recorded a collection amounting to 70,000 which was not recorded by the book.10. A trade discount amounting to 1,000 was recorded as a sales discount.21. The adjusting entry for the number 1 error includes a debit to:A. Cash 50,000B. Merchandise inventory 40,000C. Both a and b are correctD. None of the above22. The adjusting entry for the number 1 error includes a credit to:A. Sales 50,000B. Merchandise inventory 40,000C. Both a and b are correctD. None of the above23. The adjusting entry for the number 2 error includes a debit to:A. Accounts receivable 9,000B. Allowance for doubtful accounts 9,000C. Bad debts 9,000D. None of the above24. The adjusting entry for the number 2 error includes a credit to:A. Accounts receivable 9,000B. Allowance for doubtful accounts 9,000C. Bad debts 9,000D. None of the above25. The adjusting entry for the number 3 error includes a debit to:A. Retained earnings 3,000B. Retained earnings 5,000C. No entryD. None of the above26. The adjusting entry for the number 3 error includes a credit to:A. Retained earnings 3,000B. Retained earnings 5,000C. No entryD. None of the above27. The adjusting entry for the number 4 error includes a debit to:A. Retained earnings 10,000B. Purchases 10,000C. Merchandise inventory 10,000D. None of the above28. The adjusting entry for the number 4 error includes a credit to:A. Retained earnings 10,000B. Purchases 10,000C. Merchandise inventory 10,000D. None of the above___________________________________________________________________________________________Prepared by:Jesrelle Vhon HabanaInstuctor
HUA SIONG COLLEGE OF ILOILO Accountancy DepartmentPrelim ExamAssurance and Auditing Concepts and ApplicationsName:________________________________________________________________ Date:_____________29. The adjusting entry for the number 5 error includes a debit to:A. Retained earnings 15,000B. Retained earnings 25,000C. Merchandise inventory 15,000D. Merchandise inventory 25,00030. The adjusting entry for the number 5 error includes a credit to:A. Retained earnings 15,000B. Retained earnings 25,000C. Merchandise inventory 15,000D. Merchandise inventory 25,00031. The adjusting entry for the number 6 error includes a debit to:A. Cash 40,000B. Accounts Payable 40,000C. Retained earnings 40,000D. None of the above32. The adjusting entry for the number 6 error includes a credit to:A. Cash 40,000B. Accounts Payable 40,000C. Retained earnings 40,000D. None of the above33. The adjusting entry for the number 7 error includes a debit to:A. Sales 50,000B. Merchandise inventory 30,000C. Accounts receivable 30,000D. None of the above34. The adjusting entry for the number 7 error includes a credit to:A. Sales 50,000B. Merchandise inventory 30,000C. Accounts receivable 30,000D. None of the above35. The adjusting entry for the number 8 error includes a debit to:A. Cash 10,000B. Accounts Payable 10,000C. Retained earnings 10,000D. None of the above36. The adjusting entry for the number 8 error includes a credit to:A. Cash 10,000B. Accounts Payable 10,000C. Retained earnings 10,000D. None of the above37. The adjusting entry for the number 9 error includes a debit to:A. Cash 70,000B. Accounts Receivable 70,000C. No entryD. None of the above38. The adjusting entry for the number 9 error includes a credit to:A. Cash 70,000B. Accounts Receivable 70,000C. No entryD. None of the above39. The adjusting entry for the number 10 error includes a debit to:A. Retained earnings 1,000B. Sales 1,000C. Sales discount 1,000D. None of the above40. The adjusting entry for the number 10 error includes a credit to:A. Retained earnings 1,000B. Sales 1,000C. Sales discount 1,000D. None of the aboveBonus Question: Compute for the correct balance of the following:1. Cash2. Accounts Receivable3. Allowance for doubtful accounts4. Notes receivable5. Merchandise inventory6. Accounts payable7. Retained earnings___________________________________________________________________________________________Prepared by:Jesrelle Vhon HabanaInstuctor
HUA SIONG COLLEGE OF ILOILO Accountancy DepartmentPrelim ExamAssurance and Auditing Concepts and ApplicationsName:________________________________________________________________ Date:________________________________________________________________________________________________________Prepared by:Jesrelle Vhon HabanaInstuctor