Answer the following questions, with solution.

1. Bike LTD purchased 10 bikes during January 2020 and sold 6 bikes, details of which are as follows:

January1Purchased 5 bikes @ P5000 each

January 5Sold 2 bikes

January10Sold 1 bike

January15Purchased 5 bikes @ 5,500 each

January 25Sold 3 bikes

Using LAST IN FIRST OUT method, what is the cost of ending inventory on January 30, 2020?

a.22,000

b.20,000

c.21,000

d.30,500

2.COVID Corporation financial record contains the following items :

_{Post-dated checks from customers (30 days)}120,000Cash under Cashiers' custody awaitingdeposits55,500

Petty cashfund5,000 Post-dated check to suppliers79,500

Changefund7,500Dividend fund15,000

Savings account-BDO195,000NSF Checks issued by customers5,000

Current account-BPI135,000Savings account-BPI (10,000Comp. Bal.-Restricted for 2 years)110,000

The total CASH IN BANK is

a. 430,000

b. 440,000

c. 330,000

d. 340,000

3. On January 1, 2020, ATY Company paid 24,000 for 1 year rental and 18,000 for 2-year insurance premium. On December 31, 2020, what is the account balance of prepaid rental and prepaid insurance accounts in the statement of financial position, respectively?

a. 12,000 and 9,000

b. zero and 9,000

c. both have zero balances

d. 9,000 and zero

4. The total sales was P5,000, 000 of which sales on cash basis equals to 60%. The policy of the business is to provide 2% of credit sales as bad debts expense. How much is the net realizable value of the receivable?

a. 3,000,000

b. 1,960,000

c. 1,900,000

d. 2,000,000

5. Bike LTD purchased 10 bikes during January 2020 and sold 6 bikes, details of which are as follows:

January1Purchased 5 bikes @ P5000 each

January 5Sold 2 bikes

January10Sold 1 bike

January15Purchased 5 bikes @ 5,500 each

January 25Sold 3 bikes

Using FIRST IN FIRST OUT method, what is the cost of ending inventory on January 30, 2020?

a. 22,000

b. 20,000

c. 21,000

d. 30,500

6. COVID Corporation financial record contains the following items :

_{Post-dated checks from customers (30 days)}120,000Cash under Cashiers' custody awaitingdeposits55,500

Petty cashfund5,000Post-dated check tosuppliers79,500

Changefund7,500Dividendfund15,000

Savings account-BDO195,000NSF Checks issued bycustomers5,000

Current account-BPI135,000Savings account-BPI (10,000Comp. Bal.-Restricted for 2 years)110,000

The total CASH ON HAND is

a. 63,000

b. 68,000

c. 55,500

d. 83,000

7. XYZ Company's accounting records on Jan.31,2020 shows the following:

Accounts receivableP250, 000

Allow. for BadDebts24, 000

On the same date the company wrote off an accounts receivable of P6, 000. How much is the net realizable value of XYZ's accounts receivable?

a. 226,000

b. 244,000

c. 232,000

d. 220,000

8. The total sales was P5,000, 000 of which sales on cash basis equals to 60%. The policy of the business is to provide 2% of credit sales as bad debts expense. How much is the bad debts expense?

a. 60,000

b. 100,000

c. 30,000

d. 40,000

9. On Nov. 1, 2018, Zee Lou Portraits paid P36,000 to renew its insurance policy for 3 years. What amounts should be reported as prepaid insurance in Zee Lou's Dec. 31, 2019 financial statements?

a. 23,000

b. 36,000

c. 24,000

d. 35,000

10. On Nov. 1, 2018, Zee Lou Portraits paid P36,000 to renew its insurance policy for 3 years. What amounts should be reported for insurance expense in Zee Lou's Dec. 31, 2019 financial statements?

a. 12,000

b. 11,100

c. 11,000

d. 10,100