Cash and Cash Equivalents 2019
PROBLEMS
1. IMPREST SYSTEM
The following are provided by the entity:
a. Nov. 10 – Established an imprest fund of P10,000.
b. Nov. 29 – Replenished the fund. The petty cash items include the following:
i. Currency
2,000
ii. Coin
5,000
iii. Telephone
1,800
iv. Postage
1,200
c. Dec. 31 – The fund was not replenished. The fund is composed of the following:
i. Currency and Coin P7,000
ii. Supplies P1,500
iii. Postage P500
iv. Miscellaneous expense P1,000
d. Dec. 31 – The fund was replenished. The fund is composed of the following:
i. Currency and Coin P7,000
ii. Supplies P1,500
iii. Postage P500
iv. Miscellaneous expense P1,000
REQUIREMENT: Provide the journal entries for each transaction.
2. FLUCTUATING SYSTEM
The following are provided by the entity:
a. Nov. 10 – Established a petty cash fund of P10,000.
b. Nov. 11 – Petty cash disbursements amounted to P8,000.
c. Nov. 29 – Issued a check for P10,000 to replenish the fund.
d. Dec. 30 – Petty cash expenses amounted to P9,000
e. Dec. 31 – Issued a check for P15,000 to replenish the fund.
Requirement: Provide the journal entries for each transaction.
3. Vanilla Company established a petty cash fund on June 1, 2017 cashing a check for €200.
During June, the petty cash receipts are as followed:
June
4
Stamp inventory, 20
15
Miscellaneous expense, 30
20
Freight-out, 40
28
Office supplies, 16
The fund was replenished on June 30, and the fund contained €90. On July 1, the company
decided to increase the amount of the fund to €240.
Prepare journal entries to record transactions during from June 1, 2017 to July 1, 2017.
4. The following data pertain to Lincoln Corporation on December 31, 2019:
Current account at Metrobank
Current account at Allied Bank
Payroll account
Foreign bank account (in equivalent pesos)
Savings deposit in a closed bank
Postage stamps
Employee’s post dated check
IOU from employees
Credit memo from a vendor for a purchase return
Traveler’s check
Money order
Petty cash fund (P4,000 in currency and expense receipts for P6,000)
Pension fund
DAIF check of customer
Customer’s check dated 1/1/20
Time deposit – 30 days
Money market placement (due 6/30/20)
Treasury bills, due 3/31/20 (purchased 12/31/19)
P1,800,000
(100,000)
500,000
800,000
150,000
1,000
4,000
10,000
20,000
50,000
30,000
10,000
2,000,000
15,000
80,000
200,000
500,000
200,000
Treasury bills, due 1/31/20 (purchased 2/1/19)
300,000
The cash and cash equivalents as of December 31, 2019 is
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Cash and Cash Equivalents 2019
5. On December 31, 2019, Orma Company reported cash of P9,950,000 with the following
details:
Undeposited collections
600,000
Cash in bank - BDO checking account
Undeposited NSF check received from customer
Undeposited check from a customer, dated January 15, 2020
4,000,000
150,000
250,000
Cash in bank - BDO payroll fund
1,000,000
Cash in bank - BDO money market instrument, 90 days
2,000,000
Cash in foreign bank restricted
1,500,000
Cash in bank - BDO VAT account
Total
450,000
9,950,000
On December 31, 2019, what total amount should be reported as cash and cash equivalents?
6. On December 31, 2019, Alfonso Company had the following cash balances:
Cash in bank
Petty cash fund
Time deposit
Saving deposit
P15,000,000
50,000
5,000,000
2,000,000
Cash in bank includes P500,000 of compensating balance against short term borrowing
arrangement at December 31, 2019. The compensating balance is legally restricted as to
withdrawal by Alfonso. A check of P300,000 dated January 15, 2020 in payment of accounts
payable was recorded and mailed on December 31, 2019. In the current assets section of the
December 31, 2019 statement of financial position, what amount should be reported as “cash
and cash equivalents”?
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