Activity Sheet February 13 FUNAC I

Fundamentals of ABM I
Activity Sheet
Activity I
Direction: On the space provided, answer the following questions.
1. What is GAAP?
__________________________________________________________________
___________________________________________________________
_______________________________________________________________
2. On your own understanding briefly discuss the following accounting

assumptions:
a. Business Entity Assumption

__________________________________________________________________
___________________________________________________________
b. Going Concern Assumption

__________________________________________________________________
___________________________________________________________
c. Time-Period Assumption
__________________________________________________________________
___________________________________________________________
d. Accrual Assumption
__________________________________________________________________
___________________________________________________________
e. Monetary Unit Assumption

__________________________________________________________________
________________________________________________________
3. On your own understanding briefly discuss the following accounting

principles:
a. Cost Principle
______________________________________________________________
________________________________________________________
b. Revenue Recognition Principle

______________________________________________________________
________________________________________________________
c. Monetary Principle
______________________________________________________________
________________________________________________________
d. Conservatism Principle
______________________________________________________________
________________________________________________________
e. Matching Principle
_______________________________________________________________
_________________________________________________________
f. Full Disclosure Principle

_______________________________________________________________
_________________________________________________________
g. Objectivity Principle
_______________________________________________________________
_________________________________________________________
4. What are the other characteristics of a financial statement?

__________________________________________________________________
____________________________________________________________
Activity 2
Direction: On the space provided, write T if the statement is true, F if the statement is false.
________1. Cash paid for all expenses still to be incurred is recognized as expense in
the accrual basis of accounting.
________2. Materiality principle requires of any accounting principle may be ignored
when there is a significant effect on the user of financial information.
________3. Cost is more definite that valuation method.
________4. Financial reports are expected to be reliable, verifiable and objective.
________5. The going concern assumption assumes that financial statements are prepared
only once.
________6. Monetary unit assumption assumes that the monetary unit will be used in
recording the business transaction in a stable manner.
________7. Accountants use their judgment in recording transactions that requires

estimations; conservatism principle should be applied in exercising her judgment.
________8. Financial Statements are prepared at the end of the year because of going
concern assumption.
________9. The owner of the PB Shop bought a house for his wife. The cost of the house
is recorded as the property of the business.
________10. GAAP is a widely accepted rules, concepts, and principles that govern the
application of accounting procedures.
Activity 3:
Direction: On the space provided, identify and explain the Accounting Concepts and
Principle applied on the given situation below.
a. Ms. Viy Cortez, the owner of the VLine Shop, both supplies for the school project
of her nephew using her own money. This is a personal transaction of the owner
and should not be recorded in the books of the VLine Shop.
__________________________________________________________________
__________________________________________________________________
b. The purchase of a machine by LV Shop in 1989 is presented in the statement along

with the purchase of truck in 2016. If the business introduced a new repair service
which cannot be easily quantified in monetary units, then these would not appear in
the accounting record of the shop.
__________________________________________________________________
__________________________________________________________________
c. VLine shop bought a laptop for Php 52,000, but it could have been purchase at Php
50,000 from another store. The shop recorded the transaction at Php 52,000 because
that is the amount given in exchange of the laptop.
__________________________________________________________________
__________________________________________________________________
d. Salaries of LV Shop employees are reported as an expense in the week when the
employees worked and not I the week when the employees are paid.
__________________________________________________________________
__________________________________________________________________
e. On October 25, LV Shop rendered service to a client for Php 25,000. The service
fee was collected and on November 4. The entity should record the revenue of Php
25,000 in October 35, the time the service was rendered to the customer.
__________________________________________________________________
__________________________________________________________________
_

Activity Sheet February 13 FUNAC I

Uploaded by

Copyright:

Available Formats

Activity Sheet February 13 FUNAC I

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Activity Sheet February 13 FUNAC I

Uploaded by

Copyright:

Available Formats

Fundamentals of ABM I

Direction: On the space provided, answer the following questions.

2. On your own understanding briefly discuss the following accounting

a. Business Entity Assumption

b. Going Concern Assumption

e. Monetary Unit Assumption

3. On your own understanding briefly discuss the following accounting

b. Revenue Recognition Principle

f. Full Disclosure Principle

4. What are the other characteristics of a financial statement?

________3. Cost is more definite that valuation method.

________4. Financial reports are expected to be reliable, verifiable and objective.

________7. Accountants use their judgment in recording transactions that requires

b. The purchase of a machine by LV Shop in 1989 is presented in the statement along

You might also like