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Quiz 2 - Accounting Process

The trial balance of a government entity shows opening balances of cash, receivables, buildings, equipment, accumulated depreciation, payables, and surplus. During the year, the entity received allotments and cash allocations, entered contracts, paid expenses, collected and remitted revenues and taxes, issued supplies, and recorded depreciation. Adjusting entries were made for impairment of receivables and depreciation expense. Financial statements were prepared along with notes providing breakdowns of key line items.

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554 views3 pages

Quiz 2 - Accounting Process

The trial balance of a government entity shows opening balances of cash, receivables, buildings, equipment, accumulated depreciation, payables, and surplus. During the year, the entity received allotments and cash allocations, entered contracts, paid expenses, collected and remitted revenues and taxes, issued supplies, and recorded depreciation. Adjusting entries were made for impairment of receivables and depreciation expense. Financial statements were prepared along with notes providing breakdowns of key line items.

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Princess Nozal
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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The trial balance of Entity A (a government entiy) a the beginning of the period is

shown below:
Accounts Debit Credit
Cash-Collecting Officers 30,000
Accounts Receivable 80,000
Buildings 800,000
Accumulated Depreciation- 650,000
Buildings
Office Equipment 340,000
Accumulated Depreciation- 180,000
Accounts Payable 60,000
Due to BIR 20,000
Dure to GSIS 4,000
Due to Pag ibig 2,000
Due to Philhealth 1,000
Accumulated Surplus (Deficit) 333,000
Total 1,250,000 1,250,000

Notes:

 The accounts payable pertains to office supplies purchased the were already
delivered but not yet paid.
 Not yet due and demandable obligation for undelivered office equipment amount to
P20,000.

Transactions and events during the calendar year 2018:


a) Receipt of GAA amounting to P1,200,000
b) Receipt of allotment amounting to P1,100,000
c) Entity A enters into the following contracts.
i. Employment contracts-P420,000
ii. Purchase of office equipment -P300,00
iii. Purchase of office supplies -P150,000
iv. Contracts for various MOOEs – P230,000
d) Receipt of Notice of Cash Allocation amounting to P1,050,000
e) Accrual of P400,000 salaries upon approval of payroll including granting of
cash advance and liquidation thereat. The breakdown of salaries is as
follows:
Salaries and Wages P380,000
Personal Economic Relief Allowance 20,000
Gross Compensation P400,000

Withholding Tax 90,000


GSIS 30,000
Pag ibig 20,000
Philhealth 10,000
Total Deductions P 150,000
f) Receipt of delivery of purchased office equipment worth P320,000 on
account (including not yet due and demandable obligation from previous
year)
g) Payment of P320,000 accounts payable. Taxes withheld amount to P20,000
h) Receipt of delivery of purchased of office supplies worth P150,000 on
account
i) Payment of P120,000 accounts payable. Taxes withheld amount to P10,000
j) Payment for the following expenses
Water 20,000
Electricity 60,000
Telephone 40,000
Janitorial 80,000
Security 100,000
Total 300,000
Less: Withholding Taxes (20,000)
Net 280,000
k) Issued office supplies worth P130,000 to end users
l) Billed revenue for Waterworks System Fees amounting to P240,000
m) Collected P200,000 from billed revenue and remitted total collection
n) Collected P50,000 unbilled tax revenue for Tax on delivery Vans and Trucks
through direct deposit in Authorized Agent Banks
o) Remitted all taxes withheld, including those from prior year to the BIR
p) Remitted all contributions due to GSIS, Pag ibig and Philhealth, including
those of the prior year.

 Adjusting Entries
1. Depreciation Expense
a. Buildings -P30,000
b. Equipment – P20,000
2. Allowance for impairment on accounts receivable of P5,000

Required:
1. Record the transactions and events above. If no journal entry is needed,
just state the registry or other document where the transaction or event is
recorded.
2. Post the transaction in the ledger. You may use t-account or proper ledger
format (those using excel)
3. Prepare unadjusted trial balance
4. Prepared adjustment, if any
5. Prepare a complete worksheet showing columns for post-closing trial
balance
6. Prepare the closing entries
7. Prepare the statement of financial position with cross reference to the
notes
8. Prepare the statement of financial performance with cross reference to the
notes
9. Prepare the statement of financial position with cross reference to the
notes
10.Prepare the notes to the financial statements showing breakdown for the
following line items:
a. Receivable
b. Property, Plant and Equipment
c. Personnel Services
d. Maintenance and Other Operating Expenses
e. Non-cash expenses

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