28688506-SGVCupLevel2 - DySAS Level 1 EASY 1 If a...

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DySAS Level 1 EASY 1. If a transaction causes total liabilities to decrease but does not affect the owner’s equity, what change, if any, will occur in total assets? (a) assets will be increased (c) no change in total assets (b) assets will be decreased (d) none B 2. A company has assets of P45,000, no liabilities, and stockholders’ equity of P45,000. It buys store fixtures worth P5,000 on credit. What effect would this transaction have? (a) both assets and stockholders’ equity increase by P5,000 (b) both assets and stockholders’ equity decrease by P5,000 (c) assets remain the same and stockholders’ equity increases by P5,000 (d) both assets and liabilities increase by P5,000 D 3. In accounting parlance, the sequence of the arrangements of the accounts in a ledger – that is, assets first, followed by liabilities, owner’s equity accounts, revenues and expenses – is called: (a) financial statement order (c) double entry method (b) account balance (d) accounting cycle A 4. The recording phase of accounting covers the following steps, except: (a) business documents are received and prepared. (b) transactions are journalized. (c) transactions are posted to the ledger. (d) financial statements are prepared. D 5. An accrued expense is an expense: (a) incurred but not paid (c) paid but not incurred (b) incurred and paid (d) not reasonably estimable A 6. Balance sheet accounts that are not eliminated in the closing entries are called: (a) nominal (c) positive (b) private (d) real D 7. Entries prepared, as a step in the accounting process, to bring the books and accounts up-to-date, is known as: (a) opening entries (c) closing entries
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(b) adjusting entries (d) reversing entries B 8. If a general partnership, whose partnership contract provides for interest on partners' capital account balances, incurs a net loss, the interest provision of the contract: a. Must be enforced c. May be either enforced or disregarded b. Must be disregarded d. Must be rescinded by the partners A 9. A partner by estoppel: a. Ostensible partner c. Dormant b. Secret partner d. Nominal D 10.The theory which viewed the assets of a business as belonging to the owner or proprietor, the liabilities as debts of the owner, and the income of the business as an increase in the owner’s net worth or capital. a. Proprietary theory c. Entity theory b. Equity theory d. Funds theory A AVERAGE 11.The income summary account: (a) generally has a credit balance after all the accounts that should be closed have closed. (b) summarizes revenues, expenses, and net earnings or loss for the accounting
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28688506-SGVCupLevel2 - DySAS Level 1 EASY 1 If a...

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