University of the Cordilleras

College of Accountancy
1st Trimester S.Y. 2013-2014
FINAL EXAM
Accounting 101 (Accounting Orientation)
Instructor: Dominador G. Silvestre Jr., CPA, MBA
I. Match Set A with Set B. Write the letter of the best answer on the space provided for on page 2. [25 Points]
(SET A)
1. It is the provision of financial information about an
not overstated and liabilities or expenses are not
entity to users for decision making.
understated.
2. User of financial information interested about the 15. It is the result of the adequate disclosure
continuance of an entity in providing its products
standard or the principle of full disclosure.
or services.
16. It means financial information must be
3. User of financial information interested in the
comprehensible or intelligible.
ability of an entity to pay its loans and interests.
17. It is the ability to bring together for the purpose of
4. User of financial information interested in the
noting points of likeness and difference.
stability of the entity and ability to provide 18. This principle requires that the accounting
remuneration and benefits.
methods and practices should be applied on a
5. It is a summary of terms and concepts that
uniform basis from period to period.
underlie the preparation and presentation of 19. It is the characteristic of information wherein if it is
financial statements.
omitted or misstated, it could influence the
6. Assets = Liabilities + Capital.
decision of the user.
7. Assets Liabilities = Capital.
20. These represent resources owned and controlled
8. It is the capacity of information to make a
by an entity.
difference in a decision.
21. These represent present obligations of an entity
9. It is when information can help users increase the
arising from past transactions.
likelihood of accurately predicting the outcome of 22. It is the residual interest in the assets of the entity
evens.
after deducting all of its liabilities.
10. It is when the information enables users to 23. It is the increase in economic benefit during the
confirm or correct earlier expectations.
accounting period in the form of inflow of assets
11. It means providing information to the user while it
or decrease in liabilities.
has the capacity to influence decision.
24. It is the decrease in economic benefit during the
12. It means the actual effects of the transactions
accounting period in the form of decrease in
shall be properly accounted and reported in the
assets or increase in liabilities.
financial statements.
25. It is the term which means the reporting of an
13. It means freedom from bias.
asset, liability, income or expense.
14. The exercise of care and caution when dealing
with uncertainties such that assets or income are
(SET B)
A. Income
H. Liabilities
N. Materiality
U. Comparability
BB. Neutrality
B. Relevance
I. Expense
O. Timeliness
V. Contingency
CC. Employees
C. Assets
J. Conceptual
P. Size
W.Feedback Value DD. Investors
D. Entity Theory
Framework
Q. Aggregation
X. Predictive Value EE. Government
E. Equity
K. Faithful
R. Consistency
Y. Completeness
FF. Customers
F. Fund Theory
Representation
S. Faithful
Z. Financial
GG. Public
G. Proprietary
L. Measurement
Representation
Reporting
HH. Lenders
Theory
M. Recognition
T. Understandability AA. Accounting
II. Prudence
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II. Write TRUE if the statement expresses a sound thought and FALSE if otherwise. [2 Points Each]
1. A P5.00-worth item is always immaterial for a multi-million company.
2. One of the elements of faithful representation is predictive value.
3. One of the items found in the Income Statement is an asset.
4. IASB releases standards called the Philippine Financial Reporting Standards.
5. The conceptual framework is itself a standard in preparing financial statements.
6. One of the objectives of the conceptual framework is to assist auditors in forming opinion as to whether
financial statements conform to Philippine GAAP.
7. The objective of financial statements is to provide information about the financial position, financial
performance and cash flows of an entity.
8. Financial performance can be seen in the Income Statement of a company.
9. Financial position can be seen in the Balance Sheet of a company.
10. All businesses have assets.
III. Essay. Use the space provided below. [10 pts]
Explain the difference between accrual basis of accounting and cash basis. Limit your answer to 5
sentences only.
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Part I: Matching Type.

Part II: True or False

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11)

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14)

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25)

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10)

Prepared by:

Noted by:

Dominador G. Silvestre Jr.

Faculty COA

Jasmin May P. Baniaga

Department Head COA
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