Chapter 6

Business Transactions and their Analysis

NAME: Date:
Professor: Section: Score:

QUIZ 1: IDENTIFICATION:

1. This is the step in the accounting cycle where the identified

accountable events are recorded in the journals.

2. These are transactions that involve the business and another external
party.

3. These are events that do not involve an external party.

4. This type of journal entry contains only a single debit and a single
credit.

5. This source document is prepared each time goods are sold.

6. It represents the steps or procedures used to record transactions and

prepare financial statements. It implements the accounting processes
of identifying, recording, and communicating economic information.

7. Itis a document issued by a buyer to a seller indicating the types,

quantities and agreed prices for products or services that the buyer
intends to purchase.

8. Itis a document signed by the receiver of a shipment indicating that

the goods have been received by the intended recipient.

9. If you pay your tuition fee in school, the school will issue you this
document.

10. This document evidences a deposit transaction with a bank.

“There is a time for everything, and a season for every activity under the heavens;” (Ecclesiastes 3:1)

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 NAME: Date:
Professor: Section: Score:

QUIZ 2: MULTIPLE CHOICE

1. Which of the following is not an example of a source document?

a. Delivery receipt
b. Sales invoice
c. Special journal
d. Bank statement

2. It is a report that a business sends to its customer listing the transactions with the customer
during a period, the payments made by the customer and any remaining balance due from the
customer. It also serves as a notice of billing.
a. Check
b. Bank statement
c. Delivery receipt
d. Statement of account

3. Which of the following is not an external event?

a. Rendering services to clients
b. Production of goods for sale
c. Purchase of raw materials for processing
d. Payment of notes payable

4. Journal entries are recorded in the journal

a. chromatically.
b. chronologically.
c. pharmaceutically.
d. cutely.

5. Which of the following is not one of the important parts of a journal entry?
a. Date
b. Account titles and amounts to be debited and credited
c. A detailed narrative of the reason why management entered into the transaction
d. Short description of the transaction
e. All of these

6. A journal entry with more than one debit or more than one credit is called a
a. simple journal entry.
b. compound journal entry.
c. complicated journal entry.
d. sophisticated journal entry.

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7. Which of the following accounts are affected when a business owner invests cash to the
business?
a. Cash and Accounts receivable
b. Cash and Owner’s capital
c. Cash and Sales
d. Accounts receivable and Owner’s capital

8. Which of the following accounts is decreased when a business settles accounts payable?
a. Cash
b. Accounts payable
c. Owner’s capital
d. a and b

9. Which of the following is the effect of purchasing inventory on account?

a. Inventory is increased and Cash is decreased
b. Inventory is increased and Accounts payable is increased
c. Inventory is increased and Accounts payable is decreased
d. Inventory is decreased and Accounts payable is increased

10. Which of the following is the effect of a sale of goods on account?

a. Accounts receivable is increased and Cash is decreased
b. Accounts receivable is increased and Accounts payable is increased
c. Accounts receivable is increased and Sales is increased
d. Accounts receivable is decreased and Sales is decreased

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“A man who asks is a fool for five minutes. A man who never asks is a fool for
life.”
- Chinese Proverb

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NAME: Date:
Professor: Section: Score:

QUIZ 3: ACTIVITY

Instruction: Record the transactions in the journal. Indicate the dates and provide a brief description
for each journal entry.

Date Transaction
Nov. 1, 20x1 A business owner provides ₱2,000,000 cash as investment to the business.
Nov. 5, 20x1 The business obtains a ₱500,000 loan and issues a promissory note.
Nov. 8, 20x1 The business acquires equipment costing ₱1,000,000 on cash basis.
Nov. 16, 20x1 The business purchases inventory costing ₱200,000 on cash basis.
Nov. 30, 20x1 The business sells goods for ₱300,000 on cash basis.

  JOURNAL
Date Account titles Debit Credit

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“I press on toward the goal to win the prize for which God has called me heavenward in Christ Jesus.”
(Philippians 3:14)
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NAME: Date:
Professor: Section: Score:

QUIZ 4: ACTIVITY

Instruction: Record the transactions in the journal. Indicate the dates and provide a brief description
for each journal entry.

Date Transaction
Dec. 1, 20x1 The business sells goods for ₱400,000 on account.
Dec. 4, 20x1 The business purchases inventory costing ₱600,000 on account.
Dec. 9, 20x1 The business collects ₱100,000 accounts receivable.
Dec. 17, 20x1 The business pays ₱200,000 accounts payable.
Dec. 28, 20x1 The business owner made temporary withdrawal of ₱120,000 cash from the
business.

  JOURNAL
Date Account titles Debit Credit

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“Let us therefore come boldly to the throne of grace, that we may obtain mercy and find grace in time of
need.”
(Hebrews 4:16)
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