technological change, laws often lag behind, and businesses must carefully navigate the complex web
of legal requirements related to consumer data.### 4. **Ethical Issues in Technology**The rapid
advancement of technology has introduced a host of ethical and legal challenges. From artificial
intelligence (AI) to genetic engineering, new technologies present novel ethical dilemmas, often at the
intersection of personal freedoms, safety, privacy, and social responsibility.#### 4.1 **Artificial
Intelligence and Automation**AI and automation are transforming industries, but they also raise
important ethical and legal concerns. The ethical issue revolves around the extent to which machines
should make decisions that affect human lives. For instance, autonomous vehicles raise concerns
about how decisions will be made in life-or-death situations. Who should be held accountable if an AI
system makes an error? Legal
Chapter 12 Revenue Recognition: Contract with Customers − Other Issues
(1-5) On January 1, 20x9, Blesilda Prudencio Company enters into a contract to transfer Product X and Product
Y to Virginia and Nanette Co. for P200,000. The contract specifies that payment of Product X will not occur until
Product Y is also delivered. In other words, payment will not occur until both Product X and Product Y are
transferred to Virginia and Nanette. Blesilda Prudencio determines that standalone prices are P60,000 for
Product X and P140,000 for Product Y. Blesilda Prudencio delivers Product X to Virginia and Nanette on February
1, 20x8. On March 1, 20x9, Blesilda Prudencio delivers Product Y to Virginia and Nanette.
1. On January 1, 20x9, the amount of ACCOUNTS RECEIVABLE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
2. On February 1, 20x9, the amount of ACCOUNTS RECEIVABLE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
3. On March 1, 20x9, the amount of ACCOUNTS RECEIVABLE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
4. On February 1, 20x9, the amount of REVENUE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
5. On March 1, 20x9, the amount of REVENUE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
Chapter 7 Foreign Currency Transactions
(6-10) JJ restaurants purchased green rice, a special variety of rice, from a foreign country for 100,000 FCs on
Nov 1, 20x4. Payment is due on January 30, 20x5.On Nov 1, 20x4, the company also entered into a 90-day
forward contract to purchase 100,000 FC. The forward contract is not designated as a hedge. The rates were as
follows:
Date Spot Rate Forward rate for March 1
November 1, 20x4 P .120 P .126 (90 days)
December 31, 20x4 .124 .129 (30 days)
January 30, 20x5 .127
, 7. The entries on January 30, 20x5, include a:
a. Credit to Cash, P12,600.
b. Debit to Pesos Payable to Exchange Broker, P12,000.
c. Credit to Foreign Currency Receivable from Exchange Broker, P12,600.
d. Credit to Premium on Forward Contract, P600.
8. The entries on January 30, 20x5, include a:
a. Debit to Pesos Payable to Exchange Broker, P12,700.
b. Credit to Foreign Currency Transaction Gain, P100.
c. Credit to Foreign Currency Receivable from Exchange Broker, P12,600.
d. Debit to Foreign Currency Units, P12,700.
9. The entries on December 31, 20x4, include a:
a. Debit to Financial Expense, P300.
b. Debit to Foreign Currency Receivable from Exchange Broker, P12,600.
c. Debit to Foreign Currency Receivable from Exchange Broker, P12,600.
300
d. Credit to Foreign Currency Payable to Exchange Broker
10. The entry on November 1, 20x4 to record the forward contract includes a:
a. Credit to Premium on Forward Contract, P600.
b. Debit to Foreign Currency Receivable from Exchange Broker, 100,000.
c. Debit to Foreign Currency Receivable from Exchange Broker, P12,600.
d. Credit to Pesos Payable to Exchange Broker, P12,600.
Chapter 13 Home Office and Branch Office Accounting: General Procedures
Betzler Company’s branch in Malate began operations on January 1, 20x4. During the first year of operations,
the home office shipped merchandise to the Malate branch that cost P250,000 at a billed priced of P300,000.
One-fourth of the merchandise remained unsold at the end of 20x4. The home office records the shipments to
the branch at the P300,000 billed price at the time shipments are made. Freight-in of P2,000 on the shipments
from the home office was paid by the branch.
11. The home office should make an adjusting entry for freight-in as follows:
a. A year-end adjusting entry debiting the branch account for P500.
b. A year-end adjusting entry debiting the branch account for P2,000.
c. A year-end adjusting entry crediting the branch account for P500.
d. No year-end adjusting entry for the freight charge
technological change, laws often lag behind, and businesses must carefully navigate the complex web of
legal requirements related to consumer data.### 4. **Ethical Issues in Technology**The rapid
advancement of technology has introduced a host of ethical and legal challenges. From artificial
intelligence (AI) to genetic engineering, new technologies present novel ethical dilemmas, often at the
intersection of personal freedoms, safety, privacy, and social responsibility.#### 4.1 **Artificial
Intelligence and Automation**AI and automation are transforming industries, but they also raise important
ethical and legal concerns. The ethical issue revolves around the extent to which machines should make
decisions that affect human lives. For instance, autonomous vehicles raise concerns about how decisions
will be made in life-or-death situations. Who should be held accountable if an AI system makes an error?
Legal
Chapter 11
(12-14) Comita Nocom and Ellen Riofrio Pasta Inn charges an initial fee of P800,000 for a franchise, withP160,000
paid when the agreement is signed on January 1, 20x5 and the balance in four annual payments starting
December 31, 20x5. The present value of the annual payments, discounted at 10% is P507,200. The franchisee
has the right to purchase P60,000 of kitchen equipment and supplies forP50,000. An additional part of the initial
fee is for advertising to be provided by Comita Nocom and Ellen Riofrio Pasta Inn during the next five years. The
value of the advertising is P1,000 a month. Franchise commences operations on January 20, 20x5.
12. The amount of unearned franchise fee on December 31, 20x5:
a. P70,000
b. P60,000
c. P10,000
, d. P667,200
14. What entry should Carmita Nocom and Ellen Riofrio Pasta Inn make for the franchise fees on January
1, 20x5?
a. Cash 160,000
Note Receivable 507,200
Franchise Revenue 597,200
pero nd
Unearned interest income/ Discount on N/R 132,800 balance?
Unearned franchise revenue 70,000
b. Cash 160,000
Note Receivable 507,200
Unearned franchise revenue 667,200
c. Cash 160,000
Note Receivable 507,200
Franchise Revenue 597,200
Unearned franchise revenue 70,000
d. Cash 160,000
Note Receivable 507,200
Unearned franchise revenue 700,000
Chapter 11
(15-16) Information relating to regular sales and consignment sales of EE Products for the year ended June 30,
20x4 follows:
Regular Sales Consignment Sales Total
Sales P 120,000 P 30,000 P 150,000
Cost of Sales 84,000 26,000 110,000
Operating expenses ? 1,760 16,910
You ascertain that merchandise costing P6,500 are in the possession of consignees and are included in the cost
of consigned merchandise sold. Operating expenses of P15,150 (more than half of which are fixed) are to be
allocated to regular sales and to consignment sales based on volume. The P1,760 operating expenses relating
to consignment sales include a commission of 5% and P260 Costs incurred by consignees relating to the entire
shipment of merchandise worth P26,000.
technological change, laws often lag behind, and businesses must carefully navigate the complex
web of legal requirements related to consumer data.### 4. **Ethical Issues in Technology**The rapid
advancement of technology has introduced a host of ethical and legal challenges. From artificial
intelligence (AI) to genetic engineering, new technologies present novel ethical dilemmas, often at the
intersection of personal freedoms, safety, privacy, and social responsibility.#### 4.1 **Artificial
Intelligence and Automation**AI and automation are transforming industries, but they also raise
important ethical and legal concerns. The ethical issue revolves around the extent to which machines
should make decisions that affect human lives. For instance, autonomous vehicles raise concerns
about how decisions will be made in life-or-death situations. Who should be held accountable if an AI
system makes an error? Legal
15. The net income on regular sales is:
a. P17,380
b. P30,280
c. P23,880
d. None of the above
16. The net income on consignment sales is:
a. P8,740
b. P2,240
c. P5,710
d. None of the above 5,775
, Rome has agreed to remove P750 of excess freight charges charged to Timber when Rome shipped twice
as much inventory as timber requested
Timber mailed a check for P11,000 to Rome as a payment for merchandise shipped from Rome to
Timber. Rome has not yet received the check.
Timber returned defective merchandise to Rome. The merchandise was billed to Timber at P4,000 when
its actual cost was P3,000.
Advertising expense attribute to the branch office was paid for by the home office in the amount of
5,000
technological change, laws often lag behind, and businesses must carefully navigate the complex web
of legal requirements related to consumer data.### 4. **Ethical Issues in Technology**The rapid
advancement of technology has introduced a host of ethical and legal challenges. From artificial
intelligence (AI) to genetic engineering, new technologies present novel ethical dilemmas, often at the
intersection of personal freedoms, safety, privacy, and social responsibility.#### 4.1 **Artificial
Intelligence and Automation**AI and automation are transforming industries, but they also raise
important ethical and legal concerns. The ethical issue revolves around the extent to which machines
should make decisions that affect human lives. For instance, autonomous vehicles raise concerns
about how decisions will be made in life-or-death situations. Who should be held accountable if an AI
system makes an error? Legal
17. Which of the following statements is correct?
a. The Home Office account in Timber’s books decreased for the P11,000 of cash in transit and is
decreased for the 750 of excess freight charges.
b. The Home Office account in Timber’s books decreased for the P5,000 of cash in transit of
advertising expense and decreased for the P750 of excess freight charges.
c. The Home Office account in Timber’s books increased for the P11,000 of cash payment to Rome
and is decreased by P4,000 for the billed cost of defective merchandise inventory.
d. The Home Office account in Timber’s books decreased for the decreased for the P750 of excess
freight charges and increased by the P5,000 of the advertising expenditure.
18. Which of the following statements is correct?
a. The Timber Branch account on Rome’s books decreased for the P11,000 of cash in transit and is
decreased for the P750 of excess freight charges.
b. The Timber Branch account on Rome’s books decreased for the P11,000 of cash in transit and is
decreased for the P750 of excess freight charges.
c. The Timber Branch account on Rome’s books decreased for the P11,000 of cash in transit and is
decreased by P4,000 for the billed cost of defective merchandise inventory.
d. The Timber Branch account on Rome’s books increased for the P11,000 of cash in transit and is
decreased for the P5,000 of allocated advertising cost.
19. If the adjusted balances for the Timber Branch Account and the Rome Home Office account is
P500,000, what unadjusted balance was listed in Rome’s Timber Branch Account?
a. P515,000
b. P510,250
c. P514,000
d. P504,000
20. If the adjusted balances for the Timber Branch Account and the Rome Home Office account is
P500,000, what unadjusted balance was listed in Timber’s Home Office Account?
a. P516,000
b. P496,750
c. P505,000
d. P595,750
Chapter 9 Joint Arrangement
(21-24) Vat Company acquired a 30 percent interest in the voting stock of Zel Company for P331,000 on January
1, 20x1, when Zel's stockholders' equity consisted of capital stock of 600,000 and retained earnings of P400,000.
At the time of Vat's investment, Zel's assets and liabilities were recorded at their fair values, except for
of legal requirements related to consumer data.### 4. **Ethical Issues in Technology**The rapid
advancement of technology has introduced a host of ethical and legal challenges. From artificial
intelligence (AI) to genetic engineering, new technologies present novel ethical dilemmas, often at the
intersection of personal freedoms, safety, privacy, and social responsibility.#### 4.1 **Artificial
Intelligence and Automation**AI and automation are transforming industries, but they also raise
important ethical and legal concerns. The ethical issue revolves around the extent to which machines
should make decisions that affect human lives. For instance, autonomous vehicles raise concerns
about how decisions will be made in life-or-death situations. Who should be held accountable if an AI
system makes an error? Legal
Chapter 12 Revenue Recognition: Contract with Customers − Other Issues
(1-5) On January 1, 20x9, Blesilda Prudencio Company enters into a contract to transfer Product X and Product
Y to Virginia and Nanette Co. for P200,000. The contract specifies that payment of Product X will not occur until
Product Y is also delivered. In other words, payment will not occur until both Product X and Product Y are
transferred to Virginia and Nanette. Blesilda Prudencio determines that standalone prices are P60,000 for
Product X and P140,000 for Product Y. Blesilda Prudencio delivers Product X to Virginia and Nanette on February
1, 20x8. On March 1, 20x9, Blesilda Prudencio delivers Product Y to Virginia and Nanette.
1. On January 1, 20x9, the amount of ACCOUNTS RECEIVABLE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
2. On February 1, 20x9, the amount of ACCOUNTS RECEIVABLE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
3. On March 1, 20x9, the amount of ACCOUNTS RECEIVABLE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
4. On February 1, 20x9, the amount of REVENUE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
5. On March 1, 20x9, the amount of REVENUE to be recorded:
a. P200,000
b. P60,000
c. P140,000
d. None
Chapter 7 Foreign Currency Transactions
(6-10) JJ restaurants purchased green rice, a special variety of rice, from a foreign country for 100,000 FCs on
Nov 1, 20x4. Payment is due on January 30, 20x5.On Nov 1, 20x4, the company also entered into a 90-day
forward contract to purchase 100,000 FC. The forward contract is not designated as a hedge. The rates were as
follows:
Date Spot Rate Forward rate for March 1
November 1, 20x4 P .120 P .126 (90 days)
December 31, 20x4 .124 .129 (30 days)
January 30, 20x5 .127
, 7. The entries on January 30, 20x5, include a:
a. Credit to Cash, P12,600.
b. Debit to Pesos Payable to Exchange Broker, P12,000.
c. Credit to Foreign Currency Receivable from Exchange Broker, P12,600.
d. Credit to Premium on Forward Contract, P600.
8. The entries on January 30, 20x5, include a:
a. Debit to Pesos Payable to Exchange Broker, P12,700.
b. Credit to Foreign Currency Transaction Gain, P100.
c. Credit to Foreign Currency Receivable from Exchange Broker, P12,600.
d. Debit to Foreign Currency Units, P12,700.
9. The entries on December 31, 20x4, include a:
a. Debit to Financial Expense, P300.
b. Debit to Foreign Currency Receivable from Exchange Broker, P12,600.
c. Debit to Foreign Currency Receivable from Exchange Broker, P12,600.
300
d. Credit to Foreign Currency Payable to Exchange Broker
10. The entry on November 1, 20x4 to record the forward contract includes a:
a. Credit to Premium on Forward Contract, P600.
b. Debit to Foreign Currency Receivable from Exchange Broker, 100,000.
c. Debit to Foreign Currency Receivable from Exchange Broker, P12,600.
d. Credit to Pesos Payable to Exchange Broker, P12,600.
Chapter 13 Home Office and Branch Office Accounting: General Procedures
Betzler Company’s branch in Malate began operations on January 1, 20x4. During the first year of operations,
the home office shipped merchandise to the Malate branch that cost P250,000 at a billed priced of P300,000.
One-fourth of the merchandise remained unsold at the end of 20x4. The home office records the shipments to
the branch at the P300,000 billed price at the time shipments are made. Freight-in of P2,000 on the shipments
from the home office was paid by the branch.
11. The home office should make an adjusting entry for freight-in as follows:
a. A year-end adjusting entry debiting the branch account for P500.
b. A year-end adjusting entry debiting the branch account for P2,000.
c. A year-end adjusting entry crediting the branch account for P500.
d. No year-end adjusting entry for the freight charge
technological change, laws often lag behind, and businesses must carefully navigate the complex web of
legal requirements related to consumer data.### 4. **Ethical Issues in Technology**The rapid
advancement of technology has introduced a host of ethical and legal challenges. From artificial
intelligence (AI) to genetic engineering, new technologies present novel ethical dilemmas, often at the
intersection of personal freedoms, safety, privacy, and social responsibility.#### 4.1 **Artificial
Intelligence and Automation**AI and automation are transforming industries, but they also raise important
ethical and legal concerns. The ethical issue revolves around the extent to which machines should make
decisions that affect human lives. For instance, autonomous vehicles raise concerns about how decisions
will be made in life-or-death situations. Who should be held accountable if an AI system makes an error?
Legal
Chapter 11
(12-14) Comita Nocom and Ellen Riofrio Pasta Inn charges an initial fee of P800,000 for a franchise, withP160,000
paid when the agreement is signed on January 1, 20x5 and the balance in four annual payments starting
December 31, 20x5. The present value of the annual payments, discounted at 10% is P507,200. The franchisee
has the right to purchase P60,000 of kitchen equipment and supplies forP50,000. An additional part of the initial
fee is for advertising to be provided by Comita Nocom and Ellen Riofrio Pasta Inn during the next five years. The
value of the advertising is P1,000 a month. Franchise commences operations on January 20, 20x5.
12. The amount of unearned franchise fee on December 31, 20x5:
a. P70,000
b. P60,000
c. P10,000
, d. P667,200
14. What entry should Carmita Nocom and Ellen Riofrio Pasta Inn make for the franchise fees on January
1, 20x5?
a. Cash 160,000
Note Receivable 507,200
Franchise Revenue 597,200
pero nd
Unearned interest income/ Discount on N/R 132,800 balance?
Unearned franchise revenue 70,000
b. Cash 160,000
Note Receivable 507,200
Unearned franchise revenue 667,200
c. Cash 160,000
Note Receivable 507,200
Franchise Revenue 597,200
Unearned franchise revenue 70,000
d. Cash 160,000
Note Receivable 507,200
Unearned franchise revenue 700,000
Chapter 11
(15-16) Information relating to regular sales and consignment sales of EE Products for the year ended June 30,
20x4 follows:
Regular Sales Consignment Sales Total
Sales P 120,000 P 30,000 P 150,000
Cost of Sales 84,000 26,000 110,000
Operating expenses ? 1,760 16,910
You ascertain that merchandise costing P6,500 are in the possession of consignees and are included in the cost
of consigned merchandise sold. Operating expenses of P15,150 (more than half of which are fixed) are to be
allocated to regular sales and to consignment sales based on volume. The P1,760 operating expenses relating
to consignment sales include a commission of 5% and P260 Costs incurred by consignees relating to the entire
shipment of merchandise worth P26,000.
technological change, laws often lag behind, and businesses must carefully navigate the complex
web of legal requirements related to consumer data.### 4. **Ethical Issues in Technology**The rapid
advancement of technology has introduced a host of ethical and legal challenges. From artificial
intelligence (AI) to genetic engineering, new technologies present novel ethical dilemmas, often at the
intersection of personal freedoms, safety, privacy, and social responsibility.#### 4.1 **Artificial
Intelligence and Automation**AI and automation are transforming industries, but they also raise
important ethical and legal concerns. The ethical issue revolves around the extent to which machines
should make decisions that affect human lives. For instance, autonomous vehicles raise concerns
about how decisions will be made in life-or-death situations. Who should be held accountable if an AI
system makes an error? Legal
15. The net income on regular sales is:
a. P17,380
b. P30,280
c. P23,880
d. None of the above
16. The net income on consignment sales is:
a. P8,740
b. P2,240
c. P5,710
d. None of the above 5,775
, Rome has agreed to remove P750 of excess freight charges charged to Timber when Rome shipped twice
as much inventory as timber requested
Timber mailed a check for P11,000 to Rome as a payment for merchandise shipped from Rome to
Timber. Rome has not yet received the check.
Timber returned defective merchandise to Rome. The merchandise was billed to Timber at P4,000 when
its actual cost was P3,000.
Advertising expense attribute to the branch office was paid for by the home office in the amount of
5,000
technological change, laws often lag behind, and businesses must carefully navigate the complex web
of legal requirements related to consumer data.### 4. **Ethical Issues in Technology**The rapid
advancement of technology has introduced a host of ethical and legal challenges. From artificial
intelligence (AI) to genetic engineering, new technologies present novel ethical dilemmas, often at the
intersection of personal freedoms, safety, privacy, and social responsibility.#### 4.1 **Artificial
Intelligence and Automation**AI and automation are transforming industries, but they also raise
important ethical and legal concerns. The ethical issue revolves around the extent to which machines
should make decisions that affect human lives. For instance, autonomous vehicles raise concerns
about how decisions will be made in life-or-death situations. Who should be held accountable if an AI
system makes an error? Legal
17. Which of the following statements is correct?
a. The Home Office account in Timber’s books decreased for the P11,000 of cash in transit and is
decreased for the 750 of excess freight charges.
b. The Home Office account in Timber’s books decreased for the P5,000 of cash in transit of
advertising expense and decreased for the P750 of excess freight charges.
c. The Home Office account in Timber’s books increased for the P11,000 of cash payment to Rome
and is decreased by P4,000 for the billed cost of defective merchandise inventory.
d. The Home Office account in Timber’s books decreased for the decreased for the P750 of excess
freight charges and increased by the P5,000 of the advertising expenditure.
18. Which of the following statements is correct?
a. The Timber Branch account on Rome’s books decreased for the P11,000 of cash in transit and is
decreased for the P750 of excess freight charges.
b. The Timber Branch account on Rome’s books decreased for the P11,000 of cash in transit and is
decreased for the P750 of excess freight charges.
c. The Timber Branch account on Rome’s books decreased for the P11,000 of cash in transit and is
decreased by P4,000 for the billed cost of defective merchandise inventory.
d. The Timber Branch account on Rome’s books increased for the P11,000 of cash in transit and is
decreased for the P5,000 of allocated advertising cost.
19. If the adjusted balances for the Timber Branch Account and the Rome Home Office account is
P500,000, what unadjusted balance was listed in Rome’s Timber Branch Account?
a. P515,000
b. P510,250
c. P514,000
d. P504,000
20. If the adjusted balances for the Timber Branch Account and the Rome Home Office account is
P500,000, what unadjusted balance was listed in Timber’s Home Office Account?
a. P516,000
b. P496,750
c. P505,000
d. P595,750
Chapter 9 Joint Arrangement
(21-24) Vat Company acquired a 30 percent interest in the voting stock of Zel Company for P331,000 on January
1, 20x1, when Zel's stockholders' equity consisted of capital stock of 600,000 and retained earnings of P400,000.
At the time of Vat's investment, Zel's assets and liabilities were recorded at their fair values, except for
