SCORE: PROFESSOR: NAME: SECTION: Multiple Choice 1. WIN.com sells one-year and two-year subscriptions for its electronic book-of-the month download business. Subscriptions are collected in advance and credited to sales. An analysis of the recorded sales activity revealed the following: 2020 2021 P420,000 P500,000 Sales Less: Cancellations 20,000 30,000 Net Sales P400,000 P470,000 Subscriptions Expirations: 2020 P120,000 2021 155,000 P130,000 2022 125,000 200,000 2023 140,000 P400,000 P470,000 In WIN.com's Dec. 31, 2021 balance sheet, the balance for unearned subscription revenues should be a. P470,000. b. P465,000. C. P400,000. d. P340,000. 2. An analysis of Angelina Tagay Antiques unadjusted prepaid expense account at Dec. 31, 2021 revealed the following: i. An opening balance at P15,000 for Angelina Tagay's comprehensive insurance policy. Angelina Tagay paid an annual premium of P30,000 on July 1, 2020. ii. A P32,000 annual insurance premium payment made July 1, 2021. iii. A P20,000 advance rental payment for a warehouse leased for one year beginning Jan. 1, 2022. In its Dec. 31, 2021 balance sheet, what amount should Angelina Tagay report as prepaid expenses? a. P52,000 b. P36,000 c. P20,000 d. P16,000Adjusting the Accounts | 4-43 3 . on NOV. 1, 2021, Alevir Pido Portraits paid P36,000 to renew its insurance policy for 3 years. On Dec. 31, 2021, Alevir Pido's unadjusted trial balance showed a balance of P900 for prepaid insurance and P44,100 for insurance expense. What amounts should be reported for pr ook-of-the- d for prepaid insurance and insurance expense in Alevir Pido's Dec. 31, 2021 financial statements? credited to Prepaid Insurance Insurance Expense a. P33,000 P12,000 b. P34,000 P12,000 c. P34,000 P11,000 d. P34,900 P10,100 . An entity that pays employees every two weeks has paid workers P375,000 in wages and salaries for work completed during 2020. In addition, the employees earned one week's salary of P7,200 at the end of December that will be paid as part of the p14,400 payroll at the end of the first week of January in 2021. How much should the company report for salaries and wages expense for 2020? a. P367,800. b. P375,000. bscription C. P389, 400. d. P382,200. 5. Roberto Orcajada Realty pays commissions to its sales staff at the rate of 3% of net sales. Sales staff are not paid salaries but are given monthly advances of P15,000 Advances are charged to commission expense, and reconciliations against commissions are prepared quarterly. Net sales for the year ended Mar. 31, 2021 were P15,000,000. The unadjusted balance in the commissions expense account on nt at Dec. March 31, 2021 was P400,000. March advances were paid on Apr. 3, 2021. In its income statement for the year ended Mar. 31, 2021, what amount should rehensive Roberto Orcajada report as commission expense? 0,000 on a. P465,000 b. P450,000 one year C. P415,000 d. P400,000 report as4-44 | Basic Financial Accounting and Reporting 2022 Edition by Prof. WIN Ballad Based on 2021 sales of music recorded by an artist under a contract with There. angleMusic, the artist earned P200,000 after an adjustment of P16,000 eascipated returns. In addition, Therese paid the artist P150,000 in 2021 as by onable estimate of the amount recoverable from future royalties to be earned by the artists. what amount should Therese report in its 2021 income statement as royalty expense? a. P200,000 b. P216,000 C. P350,000 d. P366,000 7. How would the proceeds received from the advance sale of non-refundable tickets for a theatrical performance be reported in the seller's financial statements before the performance? a. Revenue for the entire proceeds. b. Revenue to the extent of related costs expended. C . Unearned revenue for the entire proceeds. d. Unearned revenue to the extent of related costs expended. Under Maurice Sabio Vintage Clothing Services accounting system, all insurance premiums paid are debited to prepaid insurance. For interim financial reports, Maurice Sabio makes monthly estimated charges to insurance expenses with credits follows: to prepaid insurance. Additional information for the year ended Dec. 31, 2021 is as Prepaid insurance at Dec. 31, 2020 Charges to insurance expense during 2021 (including a year- end adjustment of P10,500) P110,000 Prepaid insurance at Dec. 31, 2021 437,500 2021 What was the total amount of insurance premiums paid by Maurice Sabio during 120,500 a. P327,500 b. P427,000 P437,500 d. P448,000Adjusting the Accounts | 4-45 Edgar Detoya Law must determine the Dec. 31, 2021 year-end accruals for advertising and rent expenses. A P5,000 advertising bill was received Jan. 7, 2022. It related to cost of P3,750 for advertisements in Dec. 2021 issues and P1,250 for advertisements in Jan. 2022 issues of the newspaper. A store lease, effective Dec. 16, 2020 calls for fixed rent of P12,000 per month, payable one month from the effective date and monthly thereafter. In addition, rent equal to 5% of net sales over P3,000,000 per calendar year is payable on Jan. 31 of the following year. Net sales for 2021 were P5,500,000. In its Dec. 31, 2021 balance sheet, Edgar Detoya should report accrued liabilities of a. P125,000. b. P128,750. c. P131,000. d. P134,750. 10. SuySan Real Estate owns an office building and leases the office under a variety of rental agreements involving rent paid in advance monthly or annually. Not all tenants make timely payments of their rent. SuySan's balance sheets contained the following data: 2020 2021 Rental Receivable P192,000 P248,000 640,000 480,000 Unearned Rentals During 2021, SuySan received P1,600,000 from tenants. What amount of rental revenues should SuySan record for 2021? a. P1,816,000 b. P1,708,000 C. P1,440,000 d. P1,332,000