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Assignment Module 2 for Government Accounting and
Accounting for NPOs hsAKBK
Accountancy (Xavier University - Ateneo de Cagayan)
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Module 2
Problem 2-1.TRUE OR FALSE.
FALSE 1. The budget preparation in the Philippines uses a “bottom-up” approach. Under this approach,
the budget preparation starts from the highest levels of the government down to the lowest levels.
*lowest levels of the government to the highest levels.
FALSE 2. An entity prepares its budget by simply rolling-over the budget in the previous year and
adjusting each line item by 10% increment to reflect inflammation. This process is described as zerobased budgeting. *incremental budgeting
FALSE 3. After the budget call from DBM, the proposed budget of various agencies are submitted
immediately to the Office of the President for review. *DBM for budget hearings
FALSE 4. An entity can incur obligations after receiving notice of its appropriation, but before receiving
the allotment. *and after
FALSE 5. Budget deliberation in the Congress Start in the House of Senate. *House of Representatives
TRUE 6. A government entity must first receive an allotment before it can incur obligations.
FALSE 7. A government entity can make disbursement even before it receives a disbursement authority.
*only after
FALSE 8. Appropriation is also called obligational authority. *Allotment
TRUE 9. The Notice of Cash Allocation (NCA) is an authority issued by the DBM to central, regional, and
provincial offices and operating units to cover their cash requirements.
TRUE 10. Responsibility accounting greatly enhances budget accountability because managers are
evaluated only in terms of the costs or other variables that they control, and therefore, budget
deviations can be readily attributed to the managers accountable therefor.
PROBLEM 2-3: MULTIPLE CHOICE
Fact pattern:
A legislation approves the allocation of ₱ 100B funds to support the operations of Entity A (a government
agency) in the current year. At the start of first quarter, Entity A receives authorization to incur
obligations for a maximum amount of ₱45B in that quarter. Entity A extends half of that authorization to
its lower operating units. During the quarter, Entity A receives monthly authorization to disburse funds
not to exceed ₱15B per month. Entity A extends to half of those monthly authorization to its lower
operating units. At the end of the quarter, total obligations incurred mounted to ₱40B while total
disbursement amounted to ₱35B.
1. The allocation of the ₱100B funds to Entity A is referred to as
a. Allotment
b. Appropriation
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2.
3.
4.
5.
6.
7.
8.
c. Obligation
d. Sub-allotment
The allocation of the ₱100B funds to Entity A is authorized by
a. Department of Budget and Management (DBM)
b. Commission on Audit (COA)
c. Bureau of Treasury (BTr)
d. Congress
The ₱45B authorization is referred to as
a. Allotment
b. Appropriation
c. Obligation
d. Sub-allotment
The ₱45B authorization is received by Entity A from
a. DBM
b. COA
c. BTr
d. Congress
The half of the ₱45B extended by Entity A (Central Office) to its lower operating units is referred
to as
a. Allotment
b. Appropriation
c. Obligation
d. Sub-allotment
Which of the following best describes the ₱15B monthly authorizations?
a. Allotment
b. Obligation authority (e.g., Notice of Cash Allocation ‘NCA’)
c. Disbursement authority (e.g., Notice of Cash Allocation ‘NCA’)
d. Disbursement authority (e.g., Notice of Transfer of Allocation ‘NTA’)
The ₱15B monthly authorizations are received by Entity A from
a. DBM
b. COA
c. BTr
d. Congress
The half of the ₱15B monthly authorizations extended by Entity A (Central Office) to its lower
operating units is referred to as
a. Cash Disbursement Ceiling
b. Non-Cash Availment Authority
c. Notice of Cash Allocation (NCA)
d. Notice of Transfer of Allocation (NTA)
9. In Entity A’s first quarter Statement of Appropriations, Allotments, Obligations, Disbursements
and Balances, how much is shown as “unreleased appropriations?’
a. ₱65B
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b. ₱60B
c. ₱55B (₱100B Appropriation - ₱45B Allotment received)
d. ₱45B
10. In Entity A’s first quarter Statement of Appropriations, Allotments Obligations, Disbursements
and Balances, how much is shown “unobligated allotment?”
a. ₱6B
b. ₱5B (₱45B Allotment received - ₱40B Obligations incurred)
c. ₱10B
d. ₱15B
11. In Entity A’s first quarter Statement of Appropriations, Allotments Obligations, Disbursements
and Balances, how much is shown “unpaid obligation?”
a. ₱6B
b. ₱5B (₱40B Obligations incurred - ₱35B Disbursements)
c. ₱10B
d. ₱15B
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