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PROBLEM I The books of Kapiz Co. show the following balances at December 31, 20x1: Cash on hand Cash in Bank – current Cash in Bank – peso savings deposit Cash in Bank – dollar deposit (unrestricted) Cash in Bank – dollar deposit (restricted) Cash in 3-month money-market 3-month unrestricted time deposit Treasury bill, purchased 11/1/20x1, maturing 2/14/20x2 Treasury bond, purchased 3/1/20x1, maturing 2/28/20x2 Treasury note, purchased 12/1/20x1, maturing 2/28/20x2 Unused Credit Line Redeemable preference shares, purchased 12/1/20x1, due on 3/1/20x2 Treasury shares, purchased 12/1/20x1, to be reissued on 1/5/20x2 Sinking fund

₱ 400,000 1,200,000 5,000,000 $ 100,000 250,000 ₱ 500,000 $ 20,000 ₱1,600,000 1,000,000 400,000 4,000,000 740,000 200,000 400,000

Additional information:  Cash on hand includes a ₱40,000 check payable to Kapiz Co. dated December 29, 20x1.  During December 20x0, check amounting to ₱30,000 was drawn against the Cash in bank - current in payment of s payable. The check remains outstanding as of December 31, 20x1.  The Cash in Bank – peso savings deposit includes ₱800,000 security bond on a pending labor litigation, in favor of a previous employee. The establishment of the bond is mandated by a court of law.  The Cash in Bank – peso savings deposit also includes a compensating balance amounting to ₱500,000 which is not legally restricted.  The Cash in Bank – dollar deposit (unrestricted) includes interest of $4,000, net of tax, directly credited to Kapiz Co.’s . The exchange rate at year-end is $1 is to ₱45. How much is the cash and cash equivalents to be reported in the 20x1 financial statements? 12,870,000 PROBLEM II The cash balance of Ronnie Co. comprises the following: Cash on hand Cash in bank – savings – Alpha Bank Cash in bank – current – Alpha Bank Cash in bank – current – Beta Bank Cash in bank – deposit in escrow – Beta Bank Cash in bank – savings – Charlie Bank

300,000 600,000 (160,000) (140,000) 240,000 90,000

Additional information:  Cash on hand excludes undeposited collections of ₱60,000.  The cash in bank – savings maintained at Alpha Bank includes a ₱100,000 compensating balance which is restricted. How much is the amount of cash to be reported in the financial statements?

790,000

PROBLEM III The following were the transactions involving an entity’s petty cash fund during the period. July. 1, 20x1 Established ₱30,000 petty cash fund. July 1 through Disbursements are made for the following: 21, 20x1 - Groceries for use of employees in the pantry ₱4,200 - Transportation of Mang Benny, the messenger boy 1,500 - Snacks during meetings and conferences 3,000 - Gasoline for company vehicles 9,000 - Pedicure of Ms. Ana (secretary of the boss) – authorized 9,000 Total ₱ 26,700 July 22, 20x1

Total coins and currencies in the petty cash box is ₱1,500. Replenishment is made.

Assuming that the petty cash fund is not replenished and financial statements are prepared on July 31, 20x1, the monthend adjustment to the petty cash fund is:

Pantry supplies Transportation (500 + 3,000) Meetings and conferences Miscellaneous expense Receivable from custodian Petty cash fund PROBLEM IV As of December 31, 20x1, the petty cash fund of Kristelle Co. following: Coins and currencies 2,550 Petty cash vouchers: Gasoline for delivery equipment 3,000 Medical supplies for employees 2,040 IOU’s: Advances to employees A sheet of paper with names of several employees together with contribution to bereaved employee, attached is a currency of 2,400 Checks: Check drawn to the order of the petty cash custodian 3,000 Personal check drawn by the petty cash custodian The entry to replenish the fund on December 31, 20x1 is: Gasoline for delivery equipment Medical supplies for employees Advances to employees Cash short or over Cash in bank

4,200 10,500 3,000 9,000 1,800

28,500

with a general leger balance of ₱15,000 comprises the

5,040 2,220

2,400

3,000 2,040 2,220 2,190 9,450

PROBLEM V Jane Co. is preparing its September 30, 20x1 bank reconciliation. Relevant information is shown below: Balance per books 1,480 Balance per bank statement 2,800 Collection on note by bank (including ₱250 interest) 2,500 NSF check returned by bank 500 Bank service charges for December 70 Deposits in transit 2,200 Outstanding checks (including certified checks of ₱100) 1,000  

A ₱600 loan amortization of Jane Co. was erroneously debited by the bank to Tarzan Co.’s . A ₱650 collection of s receivable was erroneously recorded in the books as ₱560. The actual amount deposited to the bank is ₱650.

The compound entry to reconcile the s includes is Cash in bank s receivable (500 - 90) Bank service charge Note receivable (2,500 – 250) Interest income

2,020 410 70 2,250 250

PROBLEM VI Ching Co. has the following information: Balance per books Credit memos Debit memos Deposits in transit Outstanding checks How much is the cash balance per bank statement?

380 670 400 560 280 370

PROBLEM VII Taken from the records of Girly Co. are the following: Balance per books, October 31 Total Credits per books, November Balance per books, November 30 Balance per bank statement, October 31 Balance per bank statement, November 30 Total Debits per bank statement, November Loan proceeds directly credited to Girly’s in October Collection of receivable directly credited to Girly’s in November – not yet recorded in the books NSF checks returned in October NSF checks returned in November - not yet recorded in the books Check received from a customer amounting to ₱1,800 was recorded in the books in October as Overstatement in book debit in October Overstatement in book credit in November Understatement in bank debit in October Overstatement in bank credit in October Deposit amounting to ₱1,050 was recorded by the bank in November as Deposits in transit – October 31 Outstanding checks – October 31 1. 2. 3.

How much is the deposits in transit at November 30? 5,820 How much is the outstanding checks at November 30? 8,280 How much is the adjusted balance of cash at November 30?

4,440 8,320 2,400 5,520 4,560 2,800 1,200 600 900 300 180 800 300 290 370 150 4,500 3,800

3,000

PROBLEM VIII Radeline Co.’s bank statement shows an overdraft of ₱18,500 as of August 31, 20x1. Additional information is as follows:  A cash deposit of ₱1,380 appears on the bank statement as ₱1,830. The bank its it has committed an error.  The bank collected ₱700 from a customer on behalf of Radeline.  Cash deposited in an overnight depository on August 30 but not shown on the August bank statement – ₱1,800  Interest on overdraft not yet recorded – ₱1,728  Check issued but not presented – ₱2,200  The bank returned a customer check for ₱2,000 to Radeline. How much is the overdraft in Radeline’s cashbook on August 31, 20x1?

(16,322)

PROBLEM IX Kriselda Co. has the following information for the months of June and July. June 30 Book balance ? Book debits Book credits Bank balance 10,200 Bank debits Bank credits

July 31 9,300 30,700 27,000 16,800 21,300 ?

Notes collected by bank Bank service charge NSF checks Understatement of recorded cash collections Deposit in transit Outstanding checks Loan amortization of Kristeta Corp. erroneously debited to Kriselda Co.’s 1. 2. 3.

How much is the adjusted cash receipts in July? How much is the adjusted cash disbursements in July? How much is the adjusted cash balance as of July 31?

2,250 20 880

3,000 100 1,400

1,900 6,000 9,750

1,200 11,250 17,850

2,400

1,800

30,750 27,600 12,000

PROBLEM X On January 1, 20x1, UFC Co. established a petty cash fund of P400. On December 31, 20x1, the petty cash fund was examined and found to have receipts and documents for miscellaneous expenses amounting to P364. In addition, there was cash amounting to P44. What entry would be required to record replenishment of the petty cash fund on December 31, 20x1? Miscellaneous Expense...........364 Cash Short and Over...............................................8 Cash in bank........................................................356 PROBLEM XI Information from the records of ABC Co. is shown below:  s receivable - net of P8,000 credit balance in customers' s  Notes receivable (trade)  Notes receivable (non-trade), P15,000 collectible within one year  Dividends receivable  Subscriptions receivable  Advances to officers and employees (due in 10 months)  s payable - net of P10,000 debit balance in suppliers' s 1. 2.

How much is the total trade receivables? How much is the total current receivables?

100,000 15,000 30,000 2,000 2,000 4,000 3,000

123,000 154,000

PROBLEM XII On December 27, 20x1, ABC Co. received a sale order for a credit sale of goods with selling price of ₱3,000. The goods were shipped by ABC on December 31, 20x1 and were received by the buyer on January 2, 20x2. The related shipping costs amounted to ₱20. ABC Co. collected the receivable on January 5, 20x2. If the term of the sale is FOB destination, freight collect, how much net cash is collected on January 5, 20x2? 2,980 PROBLEM XIII : STALWART STRONG Co. sells inventory with a list price of ₱200,000 on under credit of 20%, 10%, 2/10, n/30. 1. If STALWART uses the gross method, how much is the debit to receivable on initial recognition? 144,000 2. If STALWART uses the net method, how much is the debit to receivable on initial recognition? 141,120 PROBLEM XIV ABC Co. has the following information on December 31, 20x1 before any year-end adjustments. Allowance for doubtful s, Jan. 1 Write-offs Recoveries

30,400 19,000 3,800

Sales (including cash sales of ₱380,000) Sales returns and discounts (including ₱3,800 sales returns on cash sales) s receivable, Dec. 31 Percentage of credit sales How much is the recoverable historical cost of s receivable?

2,280,000 22,800 570,000 3%

498,370

PROBLEM XV ABC Co. has the following information on December 31, 20x1 before any year-end adjustments. s receivable, Jan. 1 Net credit sales Collections from customers (including recoveries) Allowance for doubtful s, Jan. 1 Write-offs Recoveries Percentage of receivables 1. 2.

How much is the bad debt expense? How much is the recoverable historical cost of s receivable?

80,000 270,000 140,000 10,000 5,000 1,000 5%

4,300 195,700

PROBLEM XVI ABC Co. has been recognizing bad debt expenses based on the direct write-off method. In 20x4, ABC Co. decided to change to the allowance method and that doubtful s shall be estimated using the percentage of receivables method. The percentage is to be computed based on all available historical data up to a maximum of four years. Information for five years is shown below: Year Write-offs Recoveries Net credit sales 20x0 10,000 600 80,000 20x1 7,000 1,000 100,000 20x2 10,000 3,000 160,000 20x3 15,000 5,000 200,000 20x4 28,000 2,000 240,000 70,000 11,600 780,000 The balances of s receivables on January 1, 20x4 and December 31, 20x4 are ₱100,000 and ₱200,000, respectively. How much is the doubtful s expense to be recognized in 20x4? 34,000 PROBLEM XVI ABC Co. has the following information: Days outstanding 0 – 60 61 – 120 Over 120 Total s receivables

Receivable balances 180,000 135,000 150,000 465,000

% uncollectible 1% 2% 6%

During the year, ABC Co. wrote off ₱10,500 receivables and recovered ₱6,000 that had been written-off in prior years. The allowance for doubtful s has a beginning balance of ₱3,000. How much is the doubtful s expense for the year? 15,000 PROBLEM XVII ABC Co. sells to wholesalers on of 2/15, net 30. An analysis of ABC Co.’s trade receivable balances at December 31, 20x1, revealed the following: Receivable Age in days balances 0 – 15 180,000 16 – 30 108,000 31 – 60 90,000 61 – 90 72,000 91 – 120 54,000 121 – 150 36,000

Total s receivables

540,000

ABC Co. uses the aging of receivables method. The estimated percentages of collectibility based on past experience are shown below. s which are overdue for less than 31 days 97% s which are overdue 31 – 60 days 90% s which are overdue 61 – 90 days 85% s which are overdue 91 – 120 days 65% s which are overdue for over 120 days 40% The allowance for doubtful s has a balance of ₱18,000 as of January 1, 20x1. Write-offs and recoveries during the year amounted to ₱6,000 and ₱3,000, respectively. How much is the doubtful s expense for the year? 15,600 PROBLEM XVIII ABC Co. has the following information on December 31, 20x1 before any year-end adjustments. Net credit sales 6,300,000 s receivable, December 976,500 Allowance for doubtful s, Dec. 31 (before any 53,550 necessary year-end adjustments) Percentage of credit sales 2%

The aging of receivables is shown below: Days outstanding 0 – 60 61 – 120 Over 120 Total s receivables

Receivable balances 378,000 283,500 315,000 976,500

% uncollectible 1% 2% 6%

Additional information:  ABC Co. uses the percentage of credit sales in determining bad debts in monthly financial reports and the aging of receivables for its annual financial statements.  s written-off during the year amounted to ₱119,700 and s recovered amounted to ₱28,350.  As of December 31, ABC Co. determined that ₱63,000 s receivable from a certain customer included in the “61120 days outstanding” group is 95% collectible and a ₱31,500 included in the “Over 120 days outstanding” group is worthless and needs to be written-off. 1. 2.

How much is the balance of the allowance for doubtful s on January 1, 20x1? 18,900 How much is the adjusted bad debt expense to be reported in the year-end financial statements? 132,300

PROBLEM XIX ABC Co. has the following information before any year-end adjustment. s receivable, Dec. 31 200,000 Allowance for doubtful s, Jan. 1 6,000 (Dr.) Percentage of receivables 2% Recoveries and write-offs during the year amounted to ₱1,000 and ₱7,600, respectively. How much is the bad debts expense for the year? 16,600 PROBLEM XX The following information was included in the bank reconciliation for Roman Co. for July of 2012: Checks & charges recorded by bank in July, including a July service charge of P2,800, P932,600; Service charge made by bank in June and recorded in books in July, P1,200; Customer’s NSF check returned as a bank charge in July (no entry made in books), P6,000; Customer’s NSF check returned in June, recorded by the company in July, P15,000; Outstanding checks in July 31, P300,000; Outstanding checks for June, P255,000; Checks issued in July for P20,000 recorded by the company as, P2,000; Erroneous bank charge in July, P20,000; Erroneous bank credit in June corrected in July, P30,000 and

Erroneous book receipt in June corrected in July, P5,000. What is the unadjusted disbursement per book on July 31, 2012? 922,000 PROBLEM XXI Honda Company provides for doubtful s based on 3% of credit sales. The following data are available for 2011. Credit Sales during 2011 P 21,000,000 Allowance for doubtful s 1/1/11 170,000 Collection of s written off in prior years (Customer credit was reestablished) 80,000 Customer s written off as uncollectible during 2011 300,000 What is the balance in allowance for doubtful s at December 31, 2011?

30,810

PROBLEM XXII In your audit of UMPISA PA LANG YAN! Company’s cash as of December 31, 2013, you ascertain the following information: The bookkeeper’s bank reconciliation on November 30, 2013, is as follows: Balance per bank statement, November 30 Add: Deposit in transit Total Less: Outstanding Checks No. 3408 No. 3413 No. 3414 No. 3416 No. 3417 Balance Add: Bank service charge for November Balance per general ledger, November 30

P 24,298 3,648 27,946 P 440 300 6,820 3,924 800

12,284 P 15,662 ____ 36* P 15,698

*Entered in Check in December The Cash receipt journal shows total receipts for December of P 371,766. The Cash reflects total checks issued in December of P 377,632. A collection of P 5,912 was recorded on company books on December 31 but was not deposited until January 2, 2014. The balance per bank statement at December 31, 2013 is P 17,516. This statement shows total receipts of P 373,502 and checks paid of P 380,284. Your examination reveals the following information: 1.

Check no. 3413 dated November 24, 2013, was entered in the Check as P300. Your examination of the paid checks returned with the December bank statement reveals that the amount of this check is P30.

2.

Check no. 3417 was mutilated and returned by the payee. A replacement check (no. 3453) was issued. Both checks were entered in the Check but no entry was made to cancel check no. 3417.

3.

The December bank statement includes an erroneous charge of P480.

4.

On January 3, 2014, the bank informed your client that a December bank service charge of P42 was omitted from the statement.

5.

Your examination of the bank credit memo accompanying the December bank statement discloses that it represents proceeds from the note receivable collection in December for P 4,000.

6.

The outstanding checks at December 31, 2013, are as follows: No. 3408 P 440 No. 3418 P 2,814 No. 3417 800 No. 3419 5,788

QUESTIONS:

1. What is the total book disbursement for the month of December? 2. What is the book balance at December 31? 3. The outstanding checks at December 31 totaled? 4. What is the adjusted bank balance on November 30? 5. The adjusted book receipt for the month of December should be? 6. The adjusted book disbursement for the month of December should be? 7. What is the adjusted book balance on December 31?

377,668 9,796 9,042 16,732 375,766

377,674 14,824

PROBLEM XXIII In connection with your audit of KAYA PA BA Company at December 31 2015, the following bank reconciliation was submitted to you by an employee of your client: Balance per bank Deposits in transit Outstanding checks Balance per books

P 30,534 37,856 P 68,390 42,756 P 25,634

As part of your verification, you obtained the bank statement and cancelled checks from the bank on January 15, 2016. According to the records of the company, checks issued from January 1-15, 2016, amounted to P 22,482. Checks returned by the bank on January 15, 2016 totaled P 58,438. Of the checks outstanding on December 31, 2015, P 9,600 were not returned by the bank with the January 15, 2016, bank statement; and of those issued, according to the records of the company, in January 2016, P 7,200 were not returned by the bank. Based on the above data, calculate the disbursements per company records. The difference between the disbursements per books as computed and as reported is? 10,000