CUYAPO NATIONAL HIGH SCHOOL

Bulala, Cuyapo, Nueva Ecija

Senior High School

SUMMATIVE TEST IN FUNDAMENTALS OF ACCOUNTANCY, BUSINESS AND

MANAGEMENT 1
S.Y. 2019 – 2020

NAME: Date:
Teacher: Section: Score:

Direction: Read carefully the following sentences. Encircle the correct answer.
1. This represents the costs incurred when travelling on business trips.
a. Interest expense c. Rent expense
b. Travel expense d. Cost of sales

2. This represents the value of inventories that have been sold during the accounting period.
a. Interest Expense c. Rent expense
b. Travel expense d. Cost of sales

3. This represents the rentals that have been used up during the accounting period.
a. Prepaid rent c. Rent expense
b. Travel expense d. Cost of sales

4. This represents the cost of business and local taxes required by the government for the conduct of business.
a. Insurance expense c. Taxes and licenses
b. Utilities expense d. Government expense

5. This includes money or its equivalent that is readily available for unrestricted use.
a. Money expense c. Cash
b. Cash expense d. Cash payable

6. It is the aggregate of estimated losses from uncollectible accounts receivable.

a. Bad debts expense c. Accounts receivable
b. Allowance for bad debts d. Notes receivable

7. This account is used to record the temporary withdrawals of the owner during the period.
a. Owner’s drawing c. Owner’s equity
b. Owner’s capital d. Interest expense

8. For a sole proprietorship, this represents the residual amount after deducting total liabilities from total assets.
a. Owner’s drawing c. Owner’s equity
b. Salaries payable d. Interest expense

9. Revenues earned from rendering services are recorded in this account.

a. Sales c. Interest income
b. Service fees d. Gains

10. Revenues earned from sales of goods are recorded in this account.
a. Sales c. Interest income
b. Service fees d. Gains
11. The business sells goods to a customer who orally promises to pay for the purchase price after 30 days.
a. Accounts receivable c. Cash
b. Accounts payable d. Cost of sales

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12. The business purchases inventory on account (on credit).
a. Cash c. Accounts payable
b. Accounts receivable d. Prepaid supplies

13. The business pays its employees compensation for the services they have rendered during the period.
a. Rent expense d. Salaries expense
b. Cost of sales or Cost of goods sold
c. Freight-out
14. The business owner invested cash to the business.
a. Owner’s capital c. Salaries expense
b. Owner’s drawings d. Loss

15. The business renders services to clients.

a. Sales c. Interest income
b. Service fees d. Gain

II. IDENTIFICICATION:
A. Instruction: Identify the accounting term described by the statements below. Place your answers before the
numberings.
_____________________1. It is also called the “book of original entries.
_____________________2.The term used to describe the recording process which involves making journal
entries
_____________________3. This type of journal is used in recording transactions with similar nature.
_____________________4. The type of special journal used in recording all transactions involving payments of
cash.
_____________________5. Transactions that cannot be recorded in the special journals are recorded in this type
of journal.
_____________________6. It is also called the “book of secondary/final entries.”
_____________________7. This type of ledger contains all the accounts appearing in the trial balance.
_____________________8. It is the accounting record where business transactions are first recorded.
_____________________9. All transactions are recorded using this recording system.
_____________________10. These accounts are presented in the financial statements as addition to their related
accounts.

B. Instruction: Identify the normal balances of the accounts and state how the accounts are increased or
decreased (e.g., debit or credit).

Type of account Normal balance Increase Decrease

1. Asset

2. Liability

3. Equity

4. Income

5. Expense

“Do not be wise in your own eyes; fear the LORD and shun evil. “ (Proverbs 3:7)

Good Luck!!!

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