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SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014

BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
1
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.

AUDITING THEORY

I. Topic(s):
Republic Act 9298


II. Learning Objective(s):
To understand the rules and regulations covering Republic Act 9298, otherwise known as
Philippine Accountancy Act of 2004


III. Rundown
Please read and understand the other file entitled RA 9298.pdf



IV. Recommended Reference(s):
1. Text Book - Auditing Theory 2011 Edition by Salosagcol
2. Text Book Assurance Principle by Cabrera
3. Text Book Auditing & Assurance Services - David Ricchiute
4. Internet

SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
2
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.


MANAGEMENT ADVISORY SERVICES

I. Topic(s):
Managerial Accounting and Cost Concepts


II. Learning Objective(s)
(after studying the topic, you should be able to):
1. Identify the major differences and similarities between financial and managerial accounting.
2. Identify and give examples of each of the three basic manufacturing cost categories.
3. Distinguish between product costs and period costs and give examples of each.
4. Prepare an income statement including calculation of the cost of goods sold.
5. Prepare a schedule of cost of goods manufactured.
6. Understand the differences between variable costs and fixed costs.
7. Understand the differences between direct and indirect costs.
8. Understand cost classifications used in making decisions: differential costs, opportunity costs,
and sunk costs.


III. Rundown

1. Please watch below link to know and understand the topic
http://highered.mcgraw-hill.com/sites/0073379611/student_view0/chapter2/narrated_slides.html
2. Please see attached slide entitled Cost Concepts
3. After watching and reading above (1 and 2), try to answer this online multiple quiz for self
assessment.
http://highered.mcgraw-
hill.com/sites/0073379611/student_view0/chapter2/multiple_choice_quiz.html
4. After watching and reading above (1 and 2), try to answer the practice exam for self assessment
http://highered.mcgraw-hill.com/sites/0073379611/student_view0/chapter2/practice_exams.html


IV. Recommended Reference(s):
1. Managerial Accounting by Garrison
2. Managerial Accounting by Kieso Weyganth
3. Managerial Accounting by local authors
4. Internet


SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
3
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.

THEORY OF ACCOUNTS

I. Topic(s):
Presentation of Financial Statements

II. Learning Objectives:
Understand concepts of Presentation of Financial Statements


III. Rundown
1. Please read the latest textbook version of Financial Accounting Volume 1 by Valix
Chapter 2
2. Also read Philippine Accounting Standard 1

I mportant things to remember
Going concern
When preparing financial statements, management shall make an assessment of an
entitys ability to continue as a going concern. Financial statements shall be prepared on a going
concern basis unless management either intends to liquidate he entity or to cease trading, or has
no realistic alternative but to do so.

Accrual basis of accounting
An entity shall prepare its financial statements, except for cash flow information, using
the accrual basis of accounting.
.
Materiality and aggregation
Each material class of similar items shall be presented separately in the financial
statements. Items of a dissimilar nature or function shall be presented separately unless they are
immaterial.

Offsetting
Assets and liabilities, and income and expenses, shall not be offset unless required or
permitted by a Standard or an Interpretation.

Comparative information
Except when a Standard or an Interpretation permits or requires otherwise, comparative
information shall be disclosed in respect of the previous period for all amounts reported in the
financial statements.

Identification of the financial statements
The financial statements shall be identified clearly and distinguished from other
nformation in the same published document. Each component of the financial statements shall
be identified clearly.In addition, the following information shall be displayed prominently,
andrepeated when it is necessary for a proper understanding of the information presented.

Reporting period
Financial statements shall be presented at least annually. When an entitys
balance sheet date changes and the annual financial statements are presented for
a period longer or shorter than one year, an entity shall disclose, in addition to
the period covered by the financial statements.

Balance sheet
Current/non-current distinction
An entity shall present current and non-current assets, and current and
non-current liabilities, as separate classifications on the face of its balance sheet except when a
presentation based on liquidity provides information that is reliable and is more relevant.
SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
4
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.


Current assets
An asset shall be classified as current when it satisfies any of the following
criteria:
(a) it is expected to be realized in, or is intended for sale or consumption in, the
entitys normal operating cycle;
(b) it is held primarily for the purpose of being traded;
(c) it is expected to be realized within twelve months after the balance sheet
date; or
(d) it is cash or a cash equivalent unless it is restricted
from being exchanged or used to settle a liability for at least twelve months
after the balance sheet date.
All other assets shall be classified as non-current.

Current liabilities
A liability shall be classified as current when it satisfies any of the following
criteria:
(a) it is expected to be settled in the entitys normal operating cycle;
(b) it is held primarily for the purpose of being traded;
(c) it is due to be settled within twelve months after the balance sheet date; or
(d) the entity does not have an unconditional right to defer settlement of the
liability for at least twelve months after the balance sheet date.
An entity shall disclose the following, either on the face of the balance sheet or in the notes:
(a) for each class of share capital:
(i) the number of shares authorized;
(ii) the number of shares issued and fully paid, and issued but not fully
paid; (iii) par value per share, or that the shares have no par value;
(iv) a reconciliation of the number of shares outstanding at the beginning
and at the end of the period; (v) the rights, preferences and restrictions attaching to that class
including restrictions on the distribution of dividends and the
repayment of capital; (vi) shares in the entity held by the entity or by its subsidiaries or
associates; and (vii) shares reserved for issue under options and contracts for the sale of shares,
including the terms and amounts;

Profit or loss for the period
All items of income and expense recognized in a period shall be included in profit or loss
unless a Standard or an Interpretation requires otherwise.

The notes to financial statements shall:
(a) present information about the basis of preparation of the financial
statements and the specific accounting policies
;
(b) disclose the information required by IFRSs that is not presented on the face
of the balance sheet, income statement, statement of changes in equity or
cash flow statement; and
(c) provide additional information that is not presented on the face of the
balance sheet, income statement, statement of changes in equity or cash
flow statement, but is relevant to an understanding of any of them.

Disclosure of accounting policies
An entity shall disclose in the summary of significant accounting policies:
(a) the measurement basis (or bases) used in preparing the financial
statements; and
(b) the other accounting policies used that are relevant to an understanding of the financial
statements.

An entity shall disclose, in the summary of significant accounting policies or other notes, the
judgments, apart from those involving estimations, that management has made in the process of
SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
5
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.

applying the entitys accounting policies and that have the most significant effect on the amounts
recognized in the financial statements.

Key sources of estimation uncertainty
An entity shall disclose in the notes information about the key assumptions concerning
the future, and other key sources of estimation uncertainty at the balance sheet date, that have a
significant risk of causing a material adjustment to the carrying amounts of assets and liabilities
within the next financial year.
In respect of those assets and liabilities, the notes shall include details of:
(a) their nature; and
(b) their carrying amount as at the balance sheet date.

Income Statement
it is a formal statement showing the performance of the entity for a given period of time.
it is primarily measured in terms of the level of income earned by the entity through the
effective and efficient utilization of its resources.

Approaches in the income performance of an entity

1. Capital Maintenance Approach means that net income occurs only after the capital used
from the beginning of the period is maintained.

2. Transaction Approach
it is the conventional or traditional preparation of income statement
this approach of computing net income or loss requires the determination of how
much income was earned during the year and how much expense is incurred in
earning the revenue.
it is also the direct result of the application of the principle of matching costs with
revenues.

Income is the increase in economic benefit during the accounting period in the form of inflow or
increase in asset or decrease in liability that results in increase in equity, other than contribution
from equity participants.

Sources of Income
a. Sales of merchandise to customers
b. Rendering of services
c. Use of entity resources
d. Disposal of resources other than products

Expense is the decrease in economic benefit during the accounting period in the form of outflow
or decrease in asset or increase in liability that results in decrease in equity, other than
contribution from equity participants.

Expenses include the following:
e. Cost of sales
f. Distribution costs or selling expenses
g. Administrative expenses
h. Other expenses
i. Income tax expense


IV. Recommended Reference(s):
Latest Edition - Financial Accounting 1 by Conrado Valix
Philippine Accounting Standards
SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
6
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.

BUSINESS LAW

I. Topic(s):
Law on Business Transactions - Obligations

II. Learning Objective(s):
1. To learn about the sources of obligation and their concepts
2. To learn kinds of obligations in general and under Civil Code
3. To learn specific circumstances affecting obligation in general
4. To learn duties of an obligor to give, to do and not to do
5. To learn extinguishment of obligation


III. Rundown

Obligation-is a juridical necessity to give, to do or not to do.

Sources of obligation
1. Law
2. Contracts
3. Quasi contracts or Delicts

Classification of obligations

A. Primary Classification under Civil Code
1.Pure and conditional
Pure: Demandable at once
Conditional: Fulfillment or extinguishment depends upon a future certain event
2.With a period or term
Period: its fulfillment or extinguishment depends upon a future certain event
3.Alternative and Facultative
Alternative: Multiple prestations but debtor will perform one or some but not all,
depending on whose choice it is.
Facultative: Multiple prestations with a principal obligation and substitute
prestations, choice is generally given to the debtor.
4.Joint and solidary
Joint: Each can be made to pay only his share in the obligation.
Solidary: One can be made to pay for the whole obligation subject to
reimbursement.
5.Divisible and indivisible
-performance of the prestation, not to the thing which is object thereof, whether it
can be fulfilled in parts or not.
6.With a penal clause
-accessory undertaking to assume greater liability in case of breach.

B. Secondary Classification
1.Legal-from law
Conventional- from contracts
Penal- from commission of a crime
2.Real and Personal
3.Determinate and Generic
4.Positive and Negative
5.Unilateral- only one party bound to perform obligation, one debtor and one creditor( e.g
simple and remuneratory donation, to give support)
Bilateral- OR synallagmatic contracts, emptio vendito; two parties are reciprocally
bound thus debtor and creditor of each other ( e.g. purchase and sale, ease)
SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
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Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
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unlawful.

6. Individual- only one subject
Collective- several subject
7. Accessory- depends on the principal obligation e.g pledge, mortgage
Principal- main obligation
8. As to object or prestation
a. Simple-only one prestation
b.Multiple- two or more prestation
i. Conjuctive- all must be performed
ii. Distributive- one or some must be performed
a. alternative- more than one prestation but one party may choose
which one; several are due but only one must be fulfilled at the
election of the debtor.
b. Facultative- main prestation and a substitute prestation and it is
the debtor who chooses; only one thing is due but the debtor has
reserved the right to substitute it with another.
9. Possible- capable of being performed, either physically or legally
Impossible- physically or legally incapable of being done.

Nature and Effect of Obligations

Determinate and Generic things
A thing is determinate when it is particularly designated or physically segregated from all
others of the same class.
A thing is indeterminate or generic when it is not particularly designated or physically
segregated from all others of the same class.

Negligence
It is the omission of that diligence which is required by the nature of the obligation and
corresponds with the circumstances of the person, of the tie, and of the place. It is the failure to
observe, for the protection of the interest of another person, that degree of care, precaution and
vigilance which the circumstances justly demand, whereby such other person suffers injury.



IV. Recommended Reference(s):
Latest Edition - Obligation and Contract by Hector S. De Leon
Latest Edition - Obligation and Contract by Suarez
Civil Code

SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
8
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.


ONLINE ASSESSMENTS

Reminders:
1. Should be submitted on or before July 26, 2015 exclusively to
saintvicentdeferrercollege@yahoo.com


SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
9
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.


QUESTIONS:
(Multiple Choice, Computation & Identification)
Auditing Theory

1. Statement 1 - Republic Act of 9293 is also known as the Philippine Accountancy Act of
2004.
Statement 2 Code of ethics contains the norms and principles governing the practice of
the accountancy profession in the highest standards of ethical conduct.
Statement 3 Firm is an organization engaged in the practice of public accountancy
consisting of a sole proprietor, either alone or with one or more staff members.

State whether the foregoing statements are true or false.
a. All Statements are true.
b. All statements are false.
c. Only statement 2 and 3 are true
d. Only statement 1 and 2 are true

2. Which one is not a qualification for members of the Professional Regulatory Board of
Accountancy?
a. Must be a natural-born citizen and a resident of the Philippines.
b. Must be a duly registered CPA with at least 5 years of work experience in any
scope of practice of accountancy
c. Must be of good moral character
d. Must not be a Director or Officer of the APO at the time of his appointment.

3. The FRSC shall be composed of how many members?
a. 14
b. 18
c. 29
d. 15

4. The integrated national profession organization of Certified Public Accountants accredited
by the Board and the Commission per PRC Accreditation No. 15 dated October 2, 1975.
a. PICPA
b. BOA
c. APO
d. JPIA

5. Which of the following is not a qualification for applicants in the CPA board exam?
a. Has not been convicted of any criminal offense involving moral turpitude.
b. A holder of the degree of Bachelor of Science in Accountancy conferred by a
school, college, academy or institute not recognized and/or accredited by the
CHED or other authorized government offices.
c. Is of good moral character
d. A Filipino Citizen

6. Statement 1- To be qualified as having passed the licensure examinationfor accountants, a
candidate must obtain a general average of 75% with no grades lower than 65% in any given
subject.
Statement 2- The person that supervises the BS Accountancy program of an educational
institution does not have to be a CPA.
a. True, True
b. False, False
c. True, False
d. False, True

SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
10
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.

7. Statement 1- In the event a candidate obtains rating of 75% and above in at least a majority
of subjects as provided for this Act, he/she shall receive a conditional credit for the subjects
passed; Provided that a candidate shall take an examination in the remaining subjects within
a year from the preceding examination.
Statement 2- a certificate under seal, issued by the commission upon the recommendation
by the board pursuant to the revise rules and regulation of RA 9298, attesting that individual
CPA, including the staff members thereof, firms, including the sole proprietors and the staff
members thereof and partnership of CPAs including the partners and the staff members are
duly accredited to practice public accountancy in the Phil is certificate of accreditation.
a. True, True
b. False, False
c. True, False
d. False, True

8. How many times a candidate can take complete Certified Public Accountant Board
Examinations before he/she will be required to take a refresher?
a. 4
b. 3
c. 2
d. 1

9. Which of the following is not normally a service rendered by public accountants?
a. Management consultation service
b. Attest function
c. Internal auditing
d. Taxation

10. The government agency tasked by law of implementing and enforcing the regulatory
policies of the national government with respect to the regulation and licensing of the
various professions and occupations under its jurisdiction is
a. PRC
b. BOA
c. COA
d. SEC




Management Advisory Services

1. Which of the following statements is true?
a. The word "cost" has the same meaning in all situations in which it is used.
B Cost data, once classified and recorded for a specific application, are appropriate
for use in any application.
c. Costs incurred in one year are always meaningful in the following year.
d. Different cost concepts and classifications are used for different purposes.
2. Product costs are?
a. inventoried
b. expense when incurred
c. treated in the same manner as period costs
d. subtracted from cost of goods sold
3. Cost that are expensed when incurred are called:
a. Product cost
b. Direct cost
c. Inventoriable cost
d. Period cost

4. Which of the following is a period cost?
SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
11
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.

a. Direct material
b. Advertising expense
c. Depreciation on cars driven by firms president and treasurer
d. Both B and C

5. The accounting records of ABC Company revealed the following costs: direct materials
used, $170,000; direct labor, $350,000; manufacturing overhead, $400,000; and selling and
administrative expenses, $220,000. ABC product costs total:
a. $520,000
b. $750,000
c. $920,000
d. $1,140,000

6. The accounting records of DEF Corporation revealed the following selected costs: Sales
commissions, $40,000; plant supervision, $94,000; and administrative expenses, $185,000.
DEFs period costs total:
a. $40,000
b. $94,000
c. $185,000
d. $225,000

7. GHI Appliance produces washers and dryers in an assembly-line process. Labor costs
incurred during a recent period were: corporate executives, $100,000; assembly-line
workers, $80,000; security guards, $18,000; and plant supervisor, $30,000. The total of
GHIs direct labor cost was:
a. $80,000
b. $98,000
c. $110,000
d. $128,000

8. The accounting records of JLK Company revealed the following costs:
Factory Utilities $35,000
Wages of assembly-line personnel 170,000
Customer entertainment 45,000
Indirect materials used 19,000
Depreciation on salespersons cars 51,000
Production equipment rental costs 110,000
Costs that would be considered in the calculation of manufacturing overhead total:
a. $164,000
b. $215,000
c. $385,000
d. $430,000

9. MNO Industries began July with a finished-goods inventory of $48,000. The finished-
goods inventory at the end of July was $41,000 and the cost of goods sold during the month
was $125,000. The cost of goods manufactured during July was:
a. $77,000
b. $84,000
c. $118,000
d. $132,000

10. PQR Company reported a cost of goods manufactured of $260,000, with the firm's year-end
balance sheet revealing work in process and finished goods of $35,000 and $67,000,
respectively. If supplemental information disclosed raw materials used in production of
$40,000, direct labor of $70,000, and manufacturing overhead of $120,000, the company's
beginning work in process must have been:
a. $5,000
b. $37,000
SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
12
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.

c. $65,000
d. $97,000




Theory of Accounts



1. Statement 1 - Financial accounting is the process of identifying, measuring, analyzing, and
communicating financial information needed by management to plan, evaluate, and control
an organiza-tion's operations.
Statement 2 - Users of the financial information provided by a company use that information
to make capital allocation decisions.

a. Both Statement is true
b. Both statement is false
c. Statement 1 is true, statement 2 is false
d. Statement 1 is false, statement 2 is true

2. Statement 1 - Financial statements are the principal means through which financial
information is communicated to those outside an enterprise.
Statement 2 - Accounting standards are now less likely to require the recording or disclosure
of fair value information due to its inherent subjectivity.

a. Both Statement is true
b. Both statement is false
c. Statement 1 is true, statement 2 is false
d. Statement 1 is false, statement 2 is true

3. General-purpose financial statements are the product of
a. financial accounting.
b. managerial accounting.
c. both financial and managerial accounting.
d. neither financial nor managerial accounting.

4. Users of financial reports include all of the following except
a. creditors
b. government agencies
c. unions
d. all of these are users

5. The financial statements most frequently provided include all of the following except the
a. balance sheet.
b. income statement.
c. statement of cash flows.
d. statement of retained earnings.

6. The information provided by financial reporting pertains to
a. individual business enterprises, rather than to industries or an economy as a whole
or to members of society as consumers.
b. business industries, rather than to individual enterprises or an economy as a whole
or to members of society as consumers.
c. individual business enterprises, industries, and an economy as a whole, rather than
to members of society as consumers.
d. an economy as a whole and to members of society as consumers, rather than to
individual enterprises or industries.
SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
13
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.


7. The process of identifying, measuring, analyzing and communicating financial information
needed by management to plan, evaluate and control an organizations operations is called
a. financial accounting
b. managerial accounting
c. tax accounting
d. auditing

8. Statement 1- While objectives for financial reporting exist on an informal basis, no formal
objectives have been adopted.
Statement 2- An effective process of capital allocation promotes productivity and provides
an efficient market for buying and selling securities and obtaining and granting credit.
a. True, True
b. False, False
c. True, False
d. False, True

9. Statement 1-. One weakness of accrual accounting is that it does not provide a good
indication of the enterprise's present and continuing ability to generate favorable cash flows.
Statement 2- Over 115 countries require or permit use of International Financial Reporting
Standards (IFRS).
a. True, True
b. False, False
c. True, False
d. False, True

10. Statemet 1- . Some generally accepted accounting principles have simply been accepted as
appropriate because of their universal application rather than due to the action of an
authoritative accounting rule-making body.
Statement 2- IFRS are a product of careful logic or empirical findings and are not
influenced by political action.
a. True, True
b. False, False
c. True, False
d. False, True




Business Law

1. Kinds of obligation that is demandable at once.
a. Conditional
b. Joint
c. Pure
d. Divisible

2. Statement 1- Real right is the power belonging to one person to demand of another, as
definite passive subject, the fulfillment of a prestation to give, to do or not to do.
Statement 2 Personal right is the power belonging to a person over a specific thing without
a passive subject individually determined against whom such right may be personally
exercised.

a. True, True
b. False, False
c. True, False
d. False, True

SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
14
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.

3. What is fraud?
a. Deliberate and intentional evasion of the normal fulfillment of obligations
b. Any voluntary and willful act or omission which prevents the normal realization
of the prestation, knowing and intending the effects which naturally and
necessarily arise from such act.
c. Both statement is true
d. None of the above

4. Statement 1- Responsibility arising from fraud is demandable in all obligations.
Statement 2- In an obligation to give a determinate thing which is subject to a suspensive
condition, the creditor has a right to the fruits of the thing upon the perfection of the
obligation.
a. True, True
b. False, False
c. True, False
d. False, True

5. Statement 1- There can only be delay in positive obligations (to give and not to do ) and not
in negative obligations (not to give and not to do)
Statement 2- A person criminally liable is also civilly liable.
a. True, True
b. False, False
c. True, False
d. False, True

6. What is the primary remedy of creditor in case of breach?
a. Action for performance
b. Action for damages
c. Action for rescission
d. All of the above

7. Which of the following is not an example of a fortuitous event?
a. earthquake
b. storm
c. epidemic
d. none of the above
8. Statement 1- Subject to the laws, not all rights acquired in virtue of an obligation are
transmissible, if there has been no stipulation to the contrary
Statement 2- Obligations arising from contracts have the force of law between the
contracting parties.
a. True, True
b. False, False
c. True, False
d. False, True

9. Statement 1- Suspensive obligation arises, but if the condition does not happen, obligation
does not come to existence.
Statement 2- A natural obligation cannot be enforced in a court of justice
. a. True, True
b. False, False
c. True, False
d. False, True

10. Statement 1- Resolutory obligation arises, but if the condition does not happen, obligation
does not come to existence.
Statement 2- A waiver of an action for future fraud is valid.
a. True, True
b. False, False
SAINT VINCENT DE FERRER COLLEGE JULY 19, 2014
BS ACCOUNTANCY (1
st
semester SY 2014-2015) Part 2
ONLINE RESOURCES by Prof. Hector Santos Jr., CPA, MBA
15
Copyright of Prof. Hector U. Santos Jr., CPA, MBA
This online resource is intended solely to whom it is authorized to receive it. If you are not the intended recipient you are hereby notified that
any disclosure, copying, distribution or taking any action in reliance on the contents of this information is strictly prohibited and may be
unlawful.

c. True, False
d. False, True