QUIZ 1 NOTES (MCGRAW & QUIZZES)

QUIZ NOTES

  • During the first year of operation of FDNACCT, the following information were made available for the preparation of the Statement of Changes in Owner’s Equity for the year ending December 31,
    2022:
    Beginning Capital, ₱230,000
    Owner’s Drawing, ₱102,000
    Net Income during the year, ₱460,000
    Additional Investment, ₱223,000
    How much is the amount of ending capital to be presented in the Statement of Changes in Owner’s Equity for the year ending December 31, 2022?

    • P811,000

    • Reason: Net income is counted as capital. Additional investment here is an addition

  • On September 1, 2022, Faith D. Nakpil began FDN Accounting Services (FDNACCT) with an initial investment of ₱60,725, and on September 30, her records showed the following account balances:
    Accounts payable, ₱8,000
    Accounts receivable, ₱12,500
    Cash, ₱27,000
    Accounting Fees Income, ₱86,000
    Notes payable, ₱26,000
    Office furniture, ₱42,250
    Rent expense, ₱12,000
    Salaries expense, ₱15,000
    Telephone expense, ₱10,500
    How much is the total assets as of September 30, 2022?

    • P81750

    • Do not add in initial investment as an asset. Furniture is an asset.

  • The following selected statement of financial statement items are shown for FDNACCT.
    Current assets ₱200,000
    Noncurrent assets ₱700,000
    Current liabilities ₱150,000
    Noncurrent liabilities ?
    Equity, end ₱300,000
    How much is the non-current liabilities?

    • P450,000

    • Get total assets first, then subtract it with equity, end and current liabilities

  • FDNACCT received the following in the month of August 2023:
    ₱30,000 for accounting services provided in July 2023.
    ₱80,000 for accounting services provided in August 2023.
    ₱50,000 for accounting services to be provided in September 2023.
    It also provided accounting services amounting to ₱70,000 in August 2023, the collection of which will be in October 2023.
    How much is the revenue for the month of August 2023?

    • 150,000

    • 80,000+70,000

    • It only said the 70k will be collected in October 2023. The services were still provided in August

  • At the end of year 2022, Faith D. Nakpil's capital account increased by ₱168,000. During 2022, she made an additional investment of ₱57,000 but took from the business an equipment with a fair market value of ₱30,000 but purchased at a cost amounting to ₱43,000. Expenses for 2022 totalled ₱490,000. How much is the net income or net loss for 2022? Write if it’s a net income or net loss on the answer sheet and worksheet.

    • Net income 154000

    • 168000 capital increase - 57000 addt. investment + 43000 withdrawal (original cost)

    • expense is a dummy variable

  • During the year, FDNACCT reported net income of ₱38,000 while the owner made additional investments in the form cash of ₱50,000 and an old laptop which was previously purchased for ₱55,000. The laptop, at the time of investment, had a fair market value of ₱20,000. If the ending equity balance is ₱430,000, how much was the equity balance at the start of the year?

    • ₱322,000

    • getting equity balance, beg. is just subtracting the investments

  • If assets increased by ₱60,000, and liabilities decreased by ₱40,000, then how much is the change in equity? Write if it’s an increase or decrease on the answer sheet and worksheet.

    • ₱100,000 increase

    • careful of the wording. decrease in liability is a +

    • 20,000

    • income are inflow of resources resulting from services provided for the period

    • Hindi naman binigay services.

    • be careful of how some descriptions may look. baka they’re not really expenses. consider what other classifications they have as accounts

    • withdrawal is not an expense

    • notes on this written in other general notes

    • total assets, beg (cash + equipment + supplies) is diff from capital, beg

    • net income does not involve withdrawals

    • notes for this are below

Other general notes (problem-solving):

  • office supplies is a current asset, office equipment and furniture are non current assets

  • in getting equity, end. (or capital, end) capital beg + rev -ex -drawings

    • capital beg is first investments

  • equity is equal to capital, end

  • to get increase in asset, get difference of total assets, end and total assets, beg.

    • to get total assets, get total liabilities and equities

    • if may capital, beg., may capital end yan (initial investment)

  • Formula for revenue: (workback)

    • OE, end + Withdrawal + expenses (basically mga binawas) + Owner’s capital, beginning

  • owner’s withdrawals are not expenses nor liabilities

Have to improve on:

  • identifying what is current or non current

  • equity balance(when equity ang hinihingi, use capital, end/beg/bal etc)

Written notes:

  • managerial accounting is also known as private accounting