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1. Aaron Company sells subscription to a specialized directory that is published semi annually and shipped to subscribers on April 15 and October 15. Subscriptions received after March 31 and September 30 cutoff dates are held for the next publication. Cash from subscriber is receive evenly during the year and is credited to deferred revenues from subscriptions. Data relating to 2009 are as follows:

Deferred revenues from subscriptions, balance 12/31/08 P 1,500,000
Cash receipts from subscribers P 7,200,000

In its December 31 2009 balance sheet, Aaron should report deferred revenues from subscription of

a. P 1,800,000 c. P 3,600,000 b. P 3,300,000 d. P 5,400,000

2. At January 1, a sole proprietorship’s asset totaled P210,000, and its liabilities amounted to P 120,000. During the year, owner investments amounted to P 72,000, And owners withdrawal totaled P75,000. At year end, assets totaled P 270,000 and liabilities amounted to P 171,000. The amount of net income for the year was

a. P 0 c. 9,000 b. P6,000 d. 12,000

3. The following pertains to Bull Company’s biological assets:

Price of the asset in the market P 5,000 Estimated commission to brokers and dealers 500 Estimated transport cost and other cost necessary to get asset to the market 300 Selling price in a binding contract to sell P 5,200

The entity’s biological assets should be valued at a. P 4,700 b.4,400 c. 4,500 d. 4,200

4. Buyer Co. regularly buys shirts from Vendor Company and is allowed trade discounts of 20% and 10% from the last price. Buyer purchased shirts from Vendor on May 27, 2009 and received an invoice with a list price of P 100,000 and payment terms 2/10, n/30. If buyer uses the net method of recording purchases, the journal entry to record the payment of June 8, 2009 will

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