UIC-SHS DEPARTMENT NAME:_____________________________

3rd MONTHLY EXAM (November 22-23, 2018) SECTION: __________________________

FABM 1 SCORE:
MS. JONAVI LUYONG
________ / ______
GENERAL INSTRUCTIONS
1. Read all items carefully.
2. Do not leave any item UNANSWERED.
3. Cheating will merit failure in this examination besides other disciplinary actions.
4. If you have questions, ask only your adviser.
Be honest, God is watching us.

TEST I.Multiple Choice. Encircle the letter of the correct answer.

1. Who is considered as the father of modern accounting?
a. Queen Victoria b. Luca Pacioli c. Augustus d. Suetonius
2. What profession does NOT use accounting information at all?
a. Entrepreneurs b. Economists c. Government officials d. None of the above
3. Information produced by this branch of accounting aims to educate students in the field of accoutancy.
a. Accounting Education c. Accounting Research
b. Financial Accounting d. Management accounting
4. Financial accounting is concerned with ________.
a. Financial Statements b. Management Reports c. Auditor’s Report d. Research results
5. Which government agency is responsible for the keeping of the national funds of the government?
a. Bureau of Treasury c. Department of Budget and Management
b. Commission on Audit d. Department of Education
6. Which statement about the academe is incorrect?
a. The financial statements are used to help students understand accountancy with less difficulty.
b. One reason why researchers study financial statements is to find possible improvemenets in the
accounting practice in the country.
c. Accounting information are useful only to those in the field of accountancy.
d. Professors, like students, can also learn from the financial statements of a company.
7. What information in the company’s financial statements is the most important for creditors?
a. Level of Profit b. Current borrowings c. Revenues d. All information are equally important
8. Which among the following is NOT considered an internal user of accounting information?
a. Owners of a business b. Senior partners of an audit firm c. Suppliers d. Field workers
9. Which of the following is NOT considered an external user of accounting information?
a. BIR Officials c. Customers
b. Production supervisor d. A student of accountancy
10. Jason is a professor in accountancy in the BS Accountancy program of the University of the Philippines. He
is also a stockholder of Everest Co. In the point of view of Everest Co., Jason is an _____.
a. External user b. Internal user c. Professor d. None of the above
11. This group of users of accounting information invested resources to the company with hopes of earning
acceptable returns.
a. Creditors b. Government c. Potential investors d. Owners or Stockholders
12. The frequency of reports generated by management accounting can be best described as _____.
a. Annually b. Quarterly c. Semi-annually d. Whenever management demands
13. Which of the following agency is NOT charged with government accounting responsibility?
a. Bureau of Treasury c. Department of Budget and Management
b. Commission on Audit d. Legislative Department
14. The role of the Commission on Audit in the government accounting process includes ____
a. Efficient and sound utilization of government funds
b. Keeping and updting the accounting books of the government
c. Management and distribution of government funds
d. Safekeeping of the national funds
15. Which of the following is a purpose of auditing?
a. To ensure that the financial statements are free from errors
b. To check the presentation of the financial statements
c. To enhance the credibility of the financial statements
d. None of the above
16. Which of the following can be considered as an internal user?
a. Board of directors b. Creditors c. Investors d. Customers
17. Statement I- Accounting research is a branch of accounting.
Statement II – Accounting research deals with the creation of new knowledge.
a. Both statements are true c. Only statement II is true
b. Only statement I is true d. Both statements are false
18. Statement I – The Bureau of Treasury shall be responsible for the formulation and implementation of the
national budget.
Statement II – The Department of Budget and Management is responsible for the safekeeping of the
national funds.
a. Both statements are true c. Only statement II is true
b. Only statement I is true d. Both statements are false
19. Which of the following does NOT fall under the category of customer?
a. Daniel, a client of SGV Auditing Firm
b. Banjo, a regular purchaser of deodorant in Aling Nena’s store
c. Ryan, an individual collecting annual payments from Company X
d. Jerome, a loyal gamer in Net X Computer Shop
20. Which of the following is NOT an internal user of accounting information?
a. Production supervisor
b. Beth, an employee who granted a loan to the company
c. Marie, a financial analyst trying to find the value of a business
d. Chief Operating Officer
21. Of all the external users, which group would least likely examine a company’s financial statements?
a. Potential investors b. Government c. Creditors d. Customers
22. These internal users of accounting information are viewed as the brains of the company.
a. Management b. Employees c. Owners or Stockholders d. Laborers
23. The following are the main functions of accounting, except.
a. Keeping systematic record of business transactions.
b. Protecting properties of the business.
c. Helps the users in making decision for the company.
d. Meeting legal requirements.
24. The ______ reveals all of the current practices and standards, and even reveals developing areas of
standards of accounting that are currently being debated upon.
a. Codification b. Double entry bookkeeping c. Technology d. Code of Ethics
25. It is an aspect of accounting that the business transactions should be written chronologically in the books of
account as they transpire.
a. Recording b. Classifying c. Summarizing d. Interpreting
26. Statement I – Double-entry bookeeping involves a debit and a credit for every transaction.
Staement II – Luca Pacioli considered as the father of modern accounting.
a. Both statements are true c. Only statement II is true
b. Only statement I is true d. Both statements are false
27. Which of the following is false?
a. Accounting is the systematic process of measuring and reporting relevant financial information about
the activities of an economic organization or unit.
b. Accounting is an art of recording, classifying, and summarizing in a significant manner and in terms of
money, transaction, and events.
c. Accounting deals with financial information and transactions.
d. Accounting is only historical in nature.
28. Statement I – Accounting helps managers and owners of business in decision-making.
Statement II – All successful companies don’t use the accounting process in some form.
a. Both statements are true c. Only statement II is true
b. Only statement I is true d. Both statements are false
29. ______ is the systematic process of measuring and reporting relevant financial information about the
activities of an economic organization or unit.
a. Accounting b. Management c. Bookeeping d. Financial
information
30. The following are the financial statements, except.
a. Income Statement b. Statement of Cash Flow c. Bookeeping d. Balance Sheet
31. Statement I- The level of profits presented in the financial statements is a primary concern for investors.
Statement II – The income is a good indicator of the profitability of a company.
a. Both statements are true c. Only statement II is true
b. Only statement I is true d. Both statements are false
32. Statement I – A profitable result of operations is a signal that the customers will make high levels of risk if
they decide to deal with the company
Statement II – .If a company’s profits are consistently high, creditors will feel more secure that the company
will not default on its debts.
a. Both statements are true c. Only statement II is true
b. Only statement I is true d. Both statements are false
33. Statement I – Accounting information helps external users in making decisions for the benefit of the
company.
Statement II- Accounting information contained in the financial statements should be presented in a
standardized manner.
a. Both statements are true c. Only statement II is true
b. Only statement I is true d. Both statements are false
34. Statement I – Financial statements are beneficial to a wide range of external and internal users.
Statement II – Government agencies use financial statements solely for regulation purposes.
a. Both statements are true c. Only statement II is true
b. Only statement I is true d. Both statements are false
35. ______ is responsible for the keeping of the government’s general accounts.
a. Bureau of Treasury c. Department of Budget and Management
b. Commission on Audit d. BIR

II. Classify each of the following users of accounting information. Write EU if it is an external user and IU if it is
an internal user. Write your answer on the space provided for.
_____1. Field workers _____ 6. Board of Directors
_____ 2. Founders of the company _____ 7. Common people
_____ 3. Professors _____ 8. Lending institutions
_____ 4. Government agencies _____ 9. Regular purchaser
_____ 5. Taxing authorities _____ 10. Suppliers

III. Identify what branch of accounting performs the following functions. Write your answer on the space
provided for.
________________ 1. Tasked with the creation of new accounting knowledge.
________________ 2. Deals with the financial transactions of a business.
________________ 3. Focuses on the preparation of reports for use of managers in their decision-making.
________________ 4. Accounting for the receipt and disposition of government funds.
________________ 5. Educates students in the field of accountancy.
________________ 6. It is the examination and review of accounting reports in order to ascertain their
fairness, propriety, and reliability.
________________ 7. Shows stewardship by the government of public funds.
________________ 8. Helps management in decision-making.
________________ 9. To guide external and internal users in their economic decisions.
________________ 10. Reports generated by this branch of accounting depend on the requests of
management.