DIAGNOSTIC EXAM - DAY 1 ( JULY 18, 2022)
Petty Cash Fund #1
1. The petty cash fund was established on May 2, 2022, in the amount of P10,000.
2. Expenditures from the fund by the custodian as of May 31, 2022, were evidenced by approved petty cash vouchers for
the following:
Various office supplies
P3,920
IOU from employees
1,200
Shipping charges
2,298
Miscellaneous expense
1,526
On May 31, 2022, the petty cash fund was replenished and increased to P12,000; currency and coins in the fund at that
time totaled P756.
Disbursements
Receipts
Balance
Balance, May 1, 2022 Deposits
P1,120,000
P350,760
Note payment direct from
customer (interest of PI,200)
37,200
Checks cleared during May
P1,246,000
Bank service charges Balance, May 31, 2022
1,080
Balance, May 31, 2022 (hindi ata to naibigay ni sir?)
Disbursements
260,880
Receipts
ABX, Inc.'s Cash Account
Balance, May 1, 2022
P 354,000
Deposits during May 2022
Checks written during May 2022
Balance
1,240,000
1,273,400
(dito siya nakalagay sabi ni G)
(dito siya nakalagay sabi ni G)
Deposits in transit are determined to be P 120,000, and checks outstanding at May 31 total P34,000. Cash on hand
(besides petty cash) at May 31, 2022, is P9,840.
1. What is the amount of petty cash shortage?
A. P2300
C. P300
B. P11,244
D. PO
2. The journal entry to record the replenishment of, and increase in the petty cash fund includes a credit to
A. Cash of P10,944
B. Cash ofP11,244
C. Petty cash fund of P 10,944
D. Petty cash fund of P 11,244
3. What amount of cash should be reported in the May 31, 2018, statement of financial position?
A. P368,720
B. P356,720
C. P368,420
D.P358,880
SOLUTION:
SOLUTION 1-1
1. Coins and currency
P 756
Fund disbursements (P3,920 + PI,200 + 2,298 + PI,526)
Petty cash accounted
Custodian's accountability
Petty cash shortage
Answer: C
8,944
9,700
10 000
P 300
2. Petty cash fund
2,000
Office supplies
Accounts receivable-employees
Shipping expense
Miscellaneous expense
Cash short/over
Cash
Answer: B
3,920
1,200
2,298
1,526
300
11,244
3.
Book
P320,600
Unadjusted balances
Deposit in transit
Cash on hand
Outstanding checks
Note collected by bank
Bank service charges
Adjusted Balances
Adjusted cash balance (P356,720 + P12,OOO)
Bank
P260,880
120,000
9,840
(34,000)
37,200
(1,080)_________________________________
356.720
P368,720
356.720
Answer: A
Bank Reconciliation #1
A company is reconciling its bank statement with internal records. The cash balance per the company’s books is P45,000.
There are P5,000 of bank charges not yet recorded, P7,500 of outstanding checks, P12,500 of deposits in transit, and P15,000
of bank credits and collections not yet taken up in the company’s books.
Requirement: What is the cash balance per bank?
SOLUTION:
Balance per books
Bank charges
Outstanding checks
Deposits in transit
Bank credits and collections
Balance per bank
45,000
(5,000)
7,500
(12,500)
15,000
50,000
Bank Reconciliation #2
E company was organized on January 2, 2022. The following items are from the company’s trial balance on December 31,
2022.
Ordinary Share capital
1,500,000
Share premium
150,000
Merchandise inventory
69,000
Land
1,000,000
Building
1,400,000
Furnitures & Fixtures
367,000
Account Receivable
165,400
Account Payable
389,650
Notes Payable – bank
500,000
Sales
6,235,200
Operating Expense (including depreciation of 400,000)
892,000
Additional Information is as follows:
Deposits in Transit, Dec 31
384,660
Service Charge for December
2,000
Outstanding checks for Dec 31
475,000
E company’s mark up on sales 30%
892,000
Questions:
1.
2.
3.
4.
5.
6.
What is the total collection from sales?
What is the total payment for merchandise purchases?
What is the total cash receipts per books?
What is the total cash disbursement per book?
What is the cash balance per book on Dec. 31?
What is the adjusted cash balance on Dec. 31?
7,416,140
803,660
801,660
SOLUTION:
1)
Sales
6,235,200
Less: Account Receivable
(165,400)
Total collection from sales
6,069,800
2)
Sales
6,235,200
Sales
Times (x) mark up
30%____
_______________________________________(1,870,560)____
1,870,560
6,235,200
4,364,640
Merchandise Inventory
_____________69,000_______
4,433,640
Account Payable_________________________(389,650)_____
2) Total payment for merchandise purchases 4,043,990
3)
Total collection from sales
6,069,800
Ordinary share capital
1,500,000
Share premium
150,000
Notes Payable – bank
500,000
3) Total cash receipts per books
8,219,800
Account Receivable #1
The following information pertains to B inc.
●
●
Sales made during 2023
Cash
100,000
Credit
320,000
Account Receivable classified by age on Dec 31, 2023.
Under 30 days
30 – 36 days
61 – 120 days
Over 120 days
●
–
–
–
–
40,000
20,000
10,000
5,000
Allowance for Doubtful account had a 400 credit balance before adjusted on Dec. 31, 2023. Prepare adjustment
on Dec. 31, 2023. Under the following assumptions:
1. The entity uses income statement approach. Assuming the uncollected rate is 1% of credit sales.
320,000 x 1% = 3,200
Doubtful Expense
Allowance for doubtful account
3,200
3,200
2. Assume the uncollectible rate is 0.75 of total sales
Cash
100,000
Credit
320,000_
420,000
x
75%____
3,150
Doubtful Expense
Allowance for doubtful account
3,150
3. Assume the entity uses the balance sheet approach
Under 30 days –
1%
30 – 60 days
–
3%
61 – 120 days
–
10%
Over 120 days –
30%
Prepare Journal Entry.
3,150
Doubtful Expense
Allowance for doubtful account
3,100
3,100
Account Receivable #2
An analysis and aging of accounts receivable of G company at December 31 revealed the following:
Accounts receivable 900,000
Allowance for uncollectible accounts, per books 50,000
Amounts deemed uncollectible 64,000
The net realizable value of the accounts receivable at December 31 should be
SOLUTION:
Accounts receivable
900,000
Amounts deemed uncollectible
(64,000)
836,000
Account Receivable #3
Purchases of merchandise - 900,000
Inventory, June 30, 2021 - 150,000
Goods were sold at 50% above cost
75% of sales were on account
Estimated bad debts 1% of credit sales
Collections from charge customers - 630,000
Allowance for bad debts June 30, 2021 after write-off of uncollectible accounts - 7,807.50
1. Compute Outstanding accounts receivable on June 30, 2021
2. Compute Sales on account?
SOLUTION:
Purchases of merchandise
Inventory, June 30, 2021
900,000
(150,000)
750,000
Inventory, June 30, 2021
x
150,000
1,125,000
75% of sales were on account
x
75%
Sales on account
843,750
Estimated bad debts 1% of credit sales
x
.99
835,312.50
Collections from charge customers
(630,000)
205,312.50
Allowance for bad debts June 30, 2021 after write-off of uncollectible accounts 7,807.50
Accounts receivable
213,120
Account Receivable #4
In your examination of the books of account of E Company for the year 2021 you have noted that the entire past due
account of the company amounting to 400,000 should be set up as allowance for doubtful accounts.
On this past due account, management improper recommendation for the company legal counsel has decided to write-off
an account with balances totaling 80,000.
As of December 31, 2020 the balance of allowance for doubtful accounts was 250,000.
Compute the additional provision required for the company’s doubtful account.
SOLUTION:
Beginning ADA
ADA, December 31, 2020
Doubtful account
400,000
(250,000)
150,000
Account Receivable #5
The following T account summarizing the transactions affecting the accounts receivable of C Company for 2016. (not
complete accounting titles; basta may kulang kulang na words)
ACCOUNTS RECEIVABLE
DEBIT
Jan. 1 balance after deducting
Charge sales
Charge for consignment
Shareholder’s subscriptions
Written off but recovered
Cash paid to customer
Deposit on contract
Claims against common carrier for damages
IOUs from employees
Cash advance to affiliates
Advances to a supplier
1. Compute current assets
2. Compute Non-current assets
3. Compute Adjusted Accounts receivable
SOLUTION:
AR
CA
59,500
NCA
CREDIT
53,000
625,000
5,000
300,000
1,000
2,500
15,000
1,500
500
10,000
5,000
Collections from customers
including over payment of
5,000
Writeoff
Merchandise returns
Allowances to customer for
shipping damages
Collections on carrier claims
Collection on subscriptions
620,000
3,500
2,500
1,500
1,000
15,000
Deposit
Claims
IOU
Affiliate
Suppliers
15,000
500
500
10,000
5,000______________
1) 65,500
2) 25,000
ACCOUNT RECEIVABLE (T-ACC)
DEBIT
Beg. Bal
Sales
recovered
CREDIT
56,000
625,000
1,000
682,000
3) Adjusted AR
59,500
Collections (620,000-5,000)
writeoff
returns
shipping
615,000
3,500
2,500
1,500
622,500