Date Description Amount

COMPUTATIONAL
The Tranca ledger showed a balance on its cash account at December 31, 2017 of P363,000
which was determined to consist of the following:
Petty cash fund* 5,000

Payroll Account – Love Bank 60,000
Restricted foreign bank account 25,000
Tbills, due 3/30/2018 (purchased 12/31/17) 70,000
Tbills, due 1/31/2018 (purchased 5/1/16) 40,000
Demand deposit – Trust bank (overdraft) (20,000)
Cash in Bank – Wise Bank** 90,000
Cash set aside for the acquisition of equipment to
Be disbursed 4months after BS date 30,000
Bond sinking fund 45,000
DAUD/DAIF check 10,000
Cash surrender Value 8,000
*Including expense receipts of 1,000, IUO’s of 500 and Employees PDC of 200
**Net of undelivered check payable to creditors of P30,000.
1. How much is the amount of Cash and Cash Equivalents at December 31, 2017? 253,300
You were hired by Talahiban Corporation to examine their accounts for the year ended December
31, 2017 and the following are the items disclosed in your examination of petty Cash account. A
surprise count of cash and cash items was conducted on January 5, 2017. The company has a
petty cash fund of P55,000 which is maintained on an Imprest basis. The cash count sheet
disclosed the following:
Bills and coins 28,750

Petty cash vouchers:
Date Description Amount

Dec. 27 Transpo exp 9,800
Dec. 31 Postage stamps 2,700
Jan. 2 Repair of sound system 3,200
Jan. 4 Representation exp 1,250
1. What is the correct amount of petty cash fund on December 31, 2017? 33,200
2. What is the amount of Shortage/Overage? 9,300
Masaya Company prepared an aging of its accounts receivables at December 31, 2017 and
determined that the estimated uncollectible on that date was P85,000. During 2017, some
customers’ accounts were written off. Additional information is available as follows:
Allowance for bad debts at 1/1/2017-credit balance P 63,000

Accounts written off 18,000
Accounts receivable at 12/31/17 600,000
Uncollectible accounts recovery during 2017 12,000
1. How much is the bad debts expense that should be reported in the income statement for
the year 2017? 28,000
Japan Company uses the balance sheet approach in estimating uncollectible accounts expense.
An aging analysis of accounts receivable at December 31, 2017 disclosed the following
information:
Age Group Total %considered uncollectible

Not yet due P 500,000 1
1-30 days past due 300,000 3
31-60 days past due 100,000 10
1. What is the net realizable value for Japan Company’s accounts receivable at
December 31, 2017? 876,000
The following transactions affecting the accounts receivable of Puypuy Co. took place during the
year 2017:
Sales(cash and credit) P600,000

Cash received from cash customers 200,000
Cash received from credit customers (P237,650 was
Received from customers who took advantage
Of the discount feature of the company’s
credit terms 3/10, n/30) 400,000
Accounts receivable written off as worthless 5,000
Credit memoranda issued to credit customers for
Sales returns and allowances 25,000
Cash refunds given to cash customers for sales
returns and allowances
Recoveries on accounts receivable written off as
Uncollectible in prior periods (not included
in cash collections above) 8,500
An aging of receivables indicate that P7,500 of the accounts receivable balance are deemed
uncollectible.
The following balances were taken from the December 31, 2016 balance sheet: Accounts
receivable-P90,000; Allowance for bad debts-P1,400
1. What is the accounts receivable ledger balance at December 31, 2017? 52,650
2. How much is the bad debt expense reported in the income statement for the year ended
December 31, 2017? 2,600
On January 1, 2017, Calo Company sold a tract of land for P5,250,000 to Taipei Company. Taipei
Company paid P1,250,000 down and signed a non-interest bearing note for the balance which is
due on January 1, 2021. There was no established exchange price for the land and the note had
no ready market. The prevailing interest rate for this type of the note was 12%.
1. How much is the interest income for the year 2018? 341,645
2.How much is the carrying value of the note on December 31, 2017? 2,847,040
3.How much is the current portion of the note on December 31, 2017? 0
Paciano Company accepted a P400,000 face value six-month 10% note dated May 15 from a
customer. On that same date, Paciano discounted the note at Rizal bank at 12% discount rate.
1. How much cash should Russia receive from the bank on May 15? 394,800
2. Assume that Russia discounted the note four months prior to its maturity date, what is the
proceeds from discounting the note? 403,200
On July 1, 2017, San Antonio Corporation sold (discounted) two, P40,000 interest bearing notes
receivable to the Aplaya Bank without recourse. Note A as a one-year, 10% note that will mature
on December 1, 2017. Note B was a six-month, 8% note that will mature on October 31, 2017.
The bank’s discount rate was 15%.
1. How much is the net proceeds from the discounting of Note A? 41,250
2. What is the gain or loss on the sale of the Note B? 1,013
KFC Company reported inventory on December 31, 2019 at P6,000,000 based on a physical
count of goods priced at cost, and before any necessary year-end adjustment relating to the
following:
*Included in the physical count were goods billed to a customer FOB shipping point on December
31, 2019.
These goods had a cost of P125,000 and were picked up by the carrier on January 10,2020.
*Goods shipped FOB shipping point on December 28, 2019 from a vendor to KFC Company were
received on January 4, 2020. The invoice cost was P300,000.
*Consigned goods to Mc Dady Chicken with selling price of 165,000 and 10% profit based on cost
1. What amount should be reported as an inventory on December 31, 2019? 6,450,000

Mc Jolly showed the following information at year-end?
Cost Retail
Beginning inventory 280,000 700,000
Sales 5,000,000
Purchases 2,480,000 5,160,000
Freight in 75,000
Markup 500,000
Markup cancelation 60,000
Markdown 250,000
Markdown cancellation 50,000
Estimated normal shrinkage is 2% of sales
1. What is the estimated cost of ending inventory under conservative approach? 450,000
2. What is the estimated cost of ending inventory under average approach? 464,754
3. What is the estimated cost of ending inventory under Fifo approach? 473,148
THEORITICAL
1. Which of the following would not be reported as inventory?

a. Land acquired for resale by a real estate firm
b. Agricultural produce held by a farm
c. Partially completed goods held by a manufacturing company
d. Machinery acquired by a manufacturing company for use in the production
process
2. Goods on consignment should be included in the inventory of

a. the consignor but not the consignee
b. the consignee but not the consignor
c. both the consignor and consignee
d. neither the consignor nor the consignee
3. Which of the following is a characteristic of a sound system of cash control?

a. Combined responsibility of handling and recording cash.
b. Audited at announced date
c. Monthly deposit of cash receipts
d. Monthly preparation of bank reconciliation
4. Which of the following is not considered cash for financial reporting purposes?
a. Petty cash funds and postal money order
b. Unrestricted compensating balance
c. Dividend, interest and tax fund
d. Postdated and stale checks from customers
5. Company’s unreleased or undelivered checks should be

a. Restored to cash account even though the said check is not recorded
b. Restored to cash account only if the check is previously recorded as a
disbursement
c. Reported as a current receivable
d. Not reported at all

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COMPUTATIONAL

Petty cash fund* 5,000

Bills and coins 28,750

Date Description Amount

2. What is the amount of Shortage/Overage? 9,300

Allowance for bad debts at 1/1/2017-credit balance P 63,000

Age Group Total %considered uncollectible

Sales(cash and credit) P600,000

1. What amount should be reported as an inventory on December 31, 2019? 6,450,000

Beginning inventory 280,000 700,000

Purchases 2,480,000 5,160,000

Markup cancelation 60,000

Markdown cancellation 50,000

Estimated normal shrinkage is 2% of sales

1. Which of the following would not be reported as inventory?

2. Goods on consignment should be included in the inventory of

3. Which of the following is a characteristic of a sound system of cash control?

5. Company’s unreleased or undelivered checks should be

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