Instruction: Encircle the letter of the correct answer in each of the given question. 1. The first step in the accounting process is- a) record transactions in the journal b) post journal entries to the ledger c) correcting a journal entry d) prepare a trial balance 2. Transactions and events happened or took place within the business enterprise best describe the - a) external transactions c) occurrence of a transaction b) internal transactions d) eventual transactions 3. A source document evidencing that orders have been placed by the customer waiting to be served by the supplier- a) purchase request c) purchase invoice b) purchase order d) purchase check 4. The source document evidencing that goods have been delivered by the supplier to the customer- a) supplier's sales invoice c) vale slip b) customer's sales invoice d) customer's delivery receipt 5. The source document issued by the supplier acknowledging that payment has been received from the customer- a) official receipt cl check b) deposit slip d) voucher 6. The source document which shows the lists of items to be requisitioned by the purchasing department of a firm- a) purchase order c) customer's order slip b) purchase request d) all of the above 7. A source document which accompanies a check when payment is made- a) check voucher c) purchase voucher b) cash voucher d) all of the above 167 8. All of the following are examples of source documents, except- a) check c) contract b) invoices d) journal 9. A source document which shows that the customer has already made payment to the supplier through issuance of a - a) check c) official receipt b) voucher d) invoice 10. A notation stamped at the upper - left hand corner on the face of the check issued bearing "account payee only" signifies that said check is - a) is not valid for encashment b) is subject for deposit for accounts payee only c) is a" stale check" d) is good as "cash" 11. A cross check means that the check is- a) not valid for payment b) not valid for encashment c) subject for deposit to payee's account d) none of the above 12. A check that has been issued by a customer to a supplier which has already reached six (6) months from the date of issue but remain unclaimed. The check is said to be- a) stale check b) manager's check c) post-dated check d) cashier's check 13. Which is not true concerning a Journal? a) journal is a book of original entry b) recording is done chronologically c) a journal entry may be simple or compound d) a journal is similar to ledger 14. The phase of accounting which involves the routine and mechanical process of writing down the business transactions and events in a chronological manner in the book of accounts- a) recording c) classifying b) summarizing d) interpreting 15. What function do accounting journals serve in the accounting process? a) classifying b) recording c) reporting d) summarizing 16. Which is not true concerning compound journal entry? a) contains one debit item and one credit item b) contains one debit item and two credit items c) contains two debit items and three credit items d) contains two items in both sides 17. What do you call the listing of all accounts used in recording the economic activities of the business- a) Trial Balance b) Balance Sheet c) Income Statement d) Chart of Accounts 18. Which is not true concerning a Journal? a) journal is a book of original entry b) recording is done chronologically c) a journal entry may be simple or compound d) a journal is similar to ledger 19. The phase of accounting which involves the routine and mechanical process of writing down the business transactions and events in a chronological manner in the book of accounts- a) recording c) classifying b) summarizing d) interpreting 20. Which of the following account titles that is differently classified from the others listed? a) Unearned Service Income c) Notes Payable b) Accounts Payable d) Prepaid Expense 21. Which of the following account titles that is differently classified from the others listed? a) cash in bank c) supplies inventory b) accounts receivable d) owner's equity 22. Which of the following account titles that is differently classified from the others listed? a) service revenue c) supplies inventory b) depreciation expense d) uncollectible account 169 23. A chart of accounts begins with- a) owner's equity c) assets b) liabilities d) expense 24. A general journal has provided columns for- a) date c) description b) folio d) all of these 25. Explanation of what transactions are all about is found in the - a) journal c) chart of accounts b) ledger d) trial balance 26. To guide a bookkeeper of the correct description of an account title- a) journal c) ledger b) chart of accounts d) trial balance 27. When rent is paid in advance for several months, it is debited to- a) an asset account c) a liability account b) an expense account d) an income account 28. Unearned Service Income account is a/an- a) asset c) income b) liability d) owner's equity 5-4 Modified Matching Type Instruction: From the list of possible answers, write the letter that corresponds to each of the given statement. List of Possible Answers A - Cash basis of accounting I-Journalizing B - General Ledger J - Opening Journal Entry C-Double-entrySystemD-SimpleJournalEntryK-JournalL-ChartofAccounts E - Books of Accounts M - Folio F- Journal Entry N - Accrual Basis G - T-account O- Unit of Measure H-Recording P - Official Receipt 170 Given Statements 1. An entry made in the Journal 2. An entry recording the initial investment of the owner. 3. Recognizes the two-fold effects of a transactions 4. The act of recording transactions in the journal. 5. The book of original entry. 6. The book of final entry. 7. An entry containing one debit and one credit item. 8. Storage of accounting data. 9. The first phase of accounting. 10. Describes what account title to be used. 11. The skeleton form of a ledger. 12. Means posting reference. 13. The source document to acknowledge payment has been received. 14. Comparison of Cash Receipts and Cash Disbursement. 15. Income is recorded although not earned and expense recorded although not paid. 16. The value of peso remains steady regardless of inflation rates. Exercises/Problems 5-1 Unknown Accounts to be Debited Instruction: Fill in the missing accounts debited to complete the journal entries Jan. 3 - J. Alegado, Capital Initial cash investment. 171