Pre-Test
MULTIPLE CHOICE. Analyze each sentence and choose the letter of the
correct answer. Write the letter of your choice before each number.
1. Which among the choices will complete the accounting equation? The
accounting equation is
Liabilities + Equity
A. Asset
B. Obligation C. Income
D. Expenses
2. For every transaction, the accounting equation should always be
A. Balanced
B. High
C. Low
D. Not balanced
3. These are obligations by the business.
A. Prepaid Expenses B. Rent Expenses C. Liabilities D. Assets
4. These are resources owned by the business.
A. Accrued Income B. Expenses C. Revenue D. Assets
5. It is the residual interest of the owner of the business. Meaning, any
assets left after paying liabilities is the right of the owner of the business.
A. Accrued Income B. Equity
C. Expenses D. Income
For numbers 6-11. Analyze the transaction for each number.
6. Juan Dela Cruz started a delivery service on Jan 1, 2021. The following
transactions occurred during the month of January. He invested PHP700,000
cash and Cars amounting to PHP300,000.
A. A:1 Million
B. L:700,000 C. L:300,000 D. L:1 Million
7. Dela Cruz borrowed PHP200,000 cash from Hagonoy Bank for use in his business.
A. L:200,000
B. L:200,000 C.OE :200,000 D. None of these
8. Bought furnitures from the Super Mall and paid PHP85,000 cash.
A. L:85,000
B. A: 85,000 C. A: 95,000 D. OE: 85,000
9. Various equipment were purchased on account from Sphinx for
PHP75,000
A. L:75,000
B. L:-75,000 C. A: 60,000 D. L:60,000
10. Dela Cruz made a cash withdrawal of PHP10,000 for personal use.
A. L: 10,000
B. A: 10,000 C. OE: -10,000 D. L: -10,000
11. The account due to Sphinx was paid in cash.
A. A: 75,000
B. L: 75,000 C. OE-75,000 D. L: -75,000
For numbers 12–15. Analyze the transaction for each number and choose
which can balanced it using the accounting equation A = L + EO.
12. Juan Dela Cruz started a delivery service on Jan 1, 2021. The following
transactions occurred during the month of January. He invested PHP700,000
cash and Cars amounting to PHP300,000.
A. OE: 1 Million B. L: 1 Million
C. A: 1 Million D. L: - 1 Million.
13. Dela Cruz borrowed PHP200,000 cash from Hagonoy Bank for use in his
business.
A. A:-200,000 B. A: 200,000
C. OE: -200,000 D. EO: 200,000
14. Various equipment were purchased on account from Sphinx for
PHP75,000.
A. A: -75,000 B. L: -75,000
C. A: 75,000 D. EO: -75,000
15. Dela Cruz borrowed PHP200,000 on account from Sphinx.
A. L: -200,000 B. A: 100,000
C. EO:200,000 D. A:200,000​