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Intermediate accounting 1...

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1. On December 31, 2014, the cash account of Jacq Company has a debit balance of P3,500,000. An analysis of the cash account shows the following details: Undeposited collections Cash in bank-PCIB checking account Cash in bank-PNB (overdraft) Undeposited NSF check received from a customer, dated Dec. 1, 2014 Undeposited check from a customer, dated January 15, 2015 Cash in bank-PCIB (fund for payroll) Cash in bank-PCIB (savings deposit) Cash in bank-PCIB (money market instrument, 90 days) Cash in foreign bank (restricted) IOUs from officers Sinking fund cash Listed stock held as temporary investment

P60, 000 500, 000 (50, 000) 15, 000 25, 000 150, 000 100, 000 2, 000,000 100, 000 30, 000 450, 000 120, 000 P3,500,000

Cash and cash equivalents on Jacq’s December 31, 2014 statement of financial position should be A. P2,760,000 C. P2,885,000 B. P2,810,000 D. P2,935,000 2. The following items were included as cash in the books of Gotch Co.: Checking account at Security Bank Checking account at BPI Checking account at Citytrust used for payment of salaries Postage stamps Employee’s post-dated check I.O.U. from an employee A check marked “DAIF” Postal money order Petty cash fund (P324 in expense receipts) Certificate of time deposit with BPI A gold ring surrendered as security by a customer who lost his wallet (at market value) The correct amount that should be reported as cash is A. P11,835 B. P11,011

(P1, 200) 5,335 5,500 107 2,300 200 1, 250 500 500 5, 000

176

1, 500

C. P16,511 D. P11,511

3. Burr Company had the following account balances at December 31, 2014: Cash in banks P2, 250, 000 Cash on hand 125, 000 Cash legally restricted for additions to plant 1, 600, 000 (expected to be disbursed in 2015) Cash in banks includes P600, 000 of compensating balances against short-term borrowing arrangements. The compensating balances are not legally restricted as to withdrawal by Burr. In the current assets section of Burr’s December 31, 2014 statement of financial position, total cash should be reported at A. P1, 775, 000 C. P2, 375, 000 B. P2, 250, 000 D. P3, 975, 000

4. Ral Corp.’s checkbook balance on December 31, 2014, was P5, 000. In addition, Ral held the following items in its safe on that date: Check payable to RAl Corp., dated January 2, 2015, in payment of a sale made in December 2014, not included in December 31 checkbook balance P2, 000 ok Check payable to Ral Corp., deposited December 15 and included in December 31 checkbook balance, but returned by bank on December 30 stamped “NSF”. The check was redeposited on January 2, 2015, and cleared on January 500 less Check drawn on Ral Corp.’s account, payable to a vendor, dated nad recorded in Ral’s books on December 31 but not mailed until January 10, 2015 300 add The proper amount to be shown as cash on Ral’s statement of financial position at December 31, 2014, is A. P4, 800 C. P6, 500 B. P5, 300 D. P6, 800 5. Trans Co. had the following balances at December 31, 2014: Cash in checking account Cash in money market account PH Treasury bill, purchased 11/1/2014, maturing 1/31/2015 PH Treasury bill, purchased 12/1/2014, maturing 3/31/2015

P35, 000 75, 000 350, 000 400, 000

Trans’s policy is to treat as cash equivalents all highly liquid investments with a maturity of three months or less when purchased. What amount should Trans report as cash and cash equivalents in its December 31, 2014 statement of financial position? A. P110, 000 C. P460, 000 B. P385, 000 D. P860, 000 6. Aguinaldo Corporation had the following transactions in its first year of operations: Sales (90% collected in the first year) Disbursements for costs and expenses Purchases of equipment for cash Proceeds from issuance of ordinary shares Payments on short-term borrowings Proceeds from short-term borrowings Depreciation on equipment Disbursements for income taxes Bad debt write-offs

P750, 000 600, 000 200, 000 250, 000 25, 000 50, 000 40, 000 45, 000 30, 000

What is the cash balance at December 31 of the first year? A. P75, 000 C. P85, 000 B. P105, 000 D. P140, 000 7. If a petty cash fund is established in the amount of P250, and contains P200 in cash and P45 in receipts for disbursements when it is replenished, the journal entry to record replenishment should include credit to the following accounts Journal Entry: Expenses 45 Cash Short/Over 5 Cash/CIB 50

8. The petty cash fund of Guiguinto Company on December 31, 2014 is composed of the following: Coins and currencies Petty cash vouchers: Gasoline payments Supplies Cash advances to employees Employee’s check returned by bank marked NSF Check drawn by the company payable to the order of the petty cash custodian, representing her salary A sheet of paper with names of employees together with contribution for a birthday gift of a c-employee in the amount of

P14, 000 3, 000 1, 000 2, 000 5, 000 20, 000 8, 000 P53, 000

The petty cash ledger account has an imprest balance of P50, 000. What is the correct amount of petty cash on December 31, 2014? A. P34, 000 C. P39, 000 B. P14, 000 D. P42, 000 9. In preparing its August 31, 2014 bank reconciliation, Apex Corp. has available following information: Balance per bank statement, 8/31/14 P18, 050 Deposit in transit, 8/31/14 3, 250 600 Return of customer’s check for insufficient funds, 8/31/14 Outstanding checks, 8/31/14 2, 750 100 Bank service charges for August At August 31, 2014, Apex’s correct cash balance is A. P18, 550 B. P17, 950

C. P17, 850 D. P17, 550

10. Poe, Inc. had the following bank reconciliation at March 31, 2014: Balance per bank statement, 3/31/14 Add: Deposit in transit Less: Outstanding checks Balance per books, 3/31/14 Data per bank for the month of April 2014 follow: Deposits Disbursements

P46, 500 10, 300 56, 800 12, 600 P44, 200 P58, 400 49, 700

All reconciling items at March 31, 2014, cleared the bank in April. Outstanding checks at April 30, 2014, totaled P7, 000. There were no deposits in transit at April 30, 2014. What is the cash balance per books at April 30, 2014? A. P48, 200 C. P55, 200 B. P52, 900 D. P58, 500 11. The bookkeeper of Santa Clara Co. recently prepared the following bank reconciliation: Santa Clara Co.

Bank Reconciliation December 31, 2014 Balance per bank statement Add: Deposit in transit Checkbook printing charge Error made in recording check No. 25 (issued in Dec.) NSF check

Deduct: Outstanding checks Note collected by bank (includes P50 interest) Balance per books

P126, 420 P8, 700 210 1, 600 5, 000

P4, 480 9, 500

15, 510

P13, 980 P127, 950

Santa Clara has P9, 100 cash on hand on December 31, 2014. The amount Santa Clara should report as cash on the statement of financial position as of December 31, 2014 should be A. P120, 260 C. P130, 640 B. P139, 740 D. P132, 240 12. Reconciliation of Heaven Company’s bank account at May 31, 2014 is: Balance per bank statement 2, 100, 000 Deposits in transit 300, 000 Checks outstanding (30, 000) Correct cash balance 2, 370, 000 Balance per book Bank service charge Correct cash balance

2, 372, 000 (2, 000) 2, 370, 000

June data as follows: Bank Total credits Total debits Collection by bank (P400, 000 note plus interest) NSF check Balance

1, 620, 000 2, 300, 000 420, 000 10, 000 1, 420, 000

Books Deposits recorded Checks recorded Balance

1, 800, 000 2, 360, 000 1, 810, 000

The deposits in transit on June 30, 2014 amount to A. P120, 000 B. P480, 000

C. P900, 000 D. P 0

13. If a petty cash fund is established in the amount of P250, and contains P150 in cash and P95 in receipts for disbursements when it is replenished, the journal entry to record replenishment should include credit(s) to the following account(s): (a) petty cash, P75 (c) cash, P95; cash short and over, P5 (b) petty cash, P100 (d) cash, P100 D

14. Bugoy’s checkbook balance at December 31, 2002 was P50,000. In addition, Bugoy had the following items in its safe on that date:  Check payable to Bugoy, dated December 31, 2002, in payment of a sale made in December 2002 not included in December 31 checkbook balance, P20,000.  Check payable to Bugoy, deposited December but returned by bank on December 30 marked NSF. The deposit and the return were both reflected in the checkbook, P5,000.  Check drawn on Bugoy’s account, payable to a vendor, dated December 30 but not mailed to payee as of December 31, 2002. The check of P3,000 is not yet recorded. The proper amount to be shown as cash on Bugoy’s balance sheet at December 31, 2002 is: (a) P48,000 (b) P65,000 (c) P68,000 (d) P70,000 D

15. The cash account of Isle Corporation has a balance of P96,000 on December 31, 2002. Your review of the cash transactions recorded in December revealed the following:  Cash receipts included customer’s checks for P4,000 dated January 10, 2003.  Cash disbursements included: Check of P10,000 payable to Ace Company. The check, dated December 23, had not been paid by the bank as of December 31. Check of P7,000 payable to King Company. The check was dated December 29 but still undelivered as of December 31. What is the correct cash balance at December 31, 2002? (a) P75,000 (b) P89,000 (c) P99,000 (d) P109,000 C For items 16 to 20: The current assets of Multi Company on December 31, 2001 include the following: Cash on hand P 50,000 Petty cash fund 10,000 Cash in bank 200,000 Accounts receivable 400,000 Inventory 500,000 Marketable equity securities 145,000 Deferred charges 20,000 Total P1,325,000 A. Cash on hand includes:  Customer’s check of P4,000 returned by bank on December 26, 2001 due to insufficient funds but subsequently redeposited and cleared by bank on January 5, 2002.  Customer’s check for P6,000 dated January 15, 2002, received December 22, 2001.  Postal money orders received from customers, P5,000.  Cash withheld from wages for income tax of employees, P15,000. B. The petty cash fund consists of the following items on December 31, 2001:  Currency and coins, P2,800.  Employees’ vales, P2,000.  Currency in envelope marked “collections for birthday party”, P1,000.

 Unreplenished petty cash vouchers, P2,000.  Check drawn payable to petty cashier, P2,200. C. Included among the checks in payment of accounts payable drawn by Multi against its current account and recorded in December 2001 are:  Check written and dated December 22, 2001 and delivered to payee on January 5, 2002, P10,000.  Check written December 26, 2001 and dated January 21, 2002, delivered to payee on December 26, 2001, P15,000. 16. How much is the adjusted cash on hand at December 31, 2001? (a) P40,000 (b) P1,328,000(c) P5,000 (d) P225,000 A

17. How much is the adjusted petty cash fund balance at December 31, 2001? (a) P40,000 (b) P1,328,000(c) P5,000 (d) P225,000 C

18. How much is the adjusted cash in bank balance at December 31, 2001? (a) P40,000 (b) P1,328,000(c) P5,000 (d) P225,000 D

19. How much is the correct cash balance on December 31, 2001? (a) P270,000 (b) P265,000 (c) P275,000

20. How much is the total current assets at December 31, 2001? (a) P1,203,000 (b) P1,328,000(c) P1,355,000

(d) P280,000 A

(d) P1,225,000 B

21. Cure Company’s newly hired assistant prepared the following bank reconciliation on March 31, 2002: Book balance P1,405,000 Add: March 31 deposit P 750,000 Collection of note 2,500,000 Interest on note 150,000 3,400,000 Total P4,805,000 Less: Care Company’s deposit to our account P1,100,000 Bank service charge 45,000 1,145,000 Adjusted book balance P3,660,000 Book balance P5,630,000 Add: Error on check no. 123 45,000 Total P5,675,000 Less: Preauthorized payments for light and water bills P 205,000 NSF checks 220,000 Outstanding checks 1,650,000 2,075,000 Adjusted bank balance P3,600,000 Check No. 123 was made for the proper amount of P249,000 in payment of account. However, it was entered in the cash payments journal as P294,000. Cure authorized the bank to automatically pay its light and water bills as submitted directly to the bank. The correct cash in bank balance is: (a) P3,660,000 (b) P3,600,000(c) P3,630,000 (d) P2,880,000C

22. If the month-end bank statement shows a balance of P36,000, outstanding checks are P12,000, a deposit of P4,000 was in transit at month-end, and a check for P500 was erroneously charged by the bank against the account, the correct balance in the bank account at month-end is: (a) P27,500 (b) P28,500 (c) P20,500 (d) P43,500 B

23. The following pertains to Mine Company on December 31, 2002: Bank statement balance P5,000,000 Checkbook balance 5,600,000 Deposit in transit 2,000,000 Outstanding checks, including P100,000 certified check 500,000 In Mine’s December 31, 2002 balance sheet, cash should be reported at: (a) P6,600,000 (b) P6,500,000(c) P7,100,000 (d) P7,200,000 A For items 24 and 25: Apache Company provides the following information for the purpose of reconciling the cash balance per book with balance per bank statement on December 31, 2001.  The bank statement showed a balance of P200,000 on December 31.  Outstanding checks as of December 31 amounted to P50,000, including a P10,000 certified check.  Deposit in transit on December 31 was P20,000.  During December, the bank charged back NSF checks of P15,000, of which P5,000 had been redeposited and cleared by December 27.  On December 23, the bank erroneously credited the account of Apache for P30,000 representing proceeds of loan granted to another company.  During December, the proceeds from notes collected by the bank for Apache amounted to P75,000, net of service charge of P2,000.

24. What is the cash balance to be shown on the balance sheet on December 31, 2001? (a) P140,000 (b) P85,000 (c) P150,000 (d) P180,000 C

25. What is the cash balance per Apache Company’s ledger on December 31, 2001? (a) P200,000 (b) P85,000 (c) P150,000 (d) P180,000 B For items 26 to 28: Bored Company is making a four-column reconciliation at June 30 from the following data. The amounts per bank statement were: Balance - May 31, P6,500; June receipts, P13,000; June disbursements, P11,000. The amounts per books were: Balance – May 31, P7,635; June receipts, P11,548; June disbursements, P11,235; Balance – June 30, P7,948. May 31 June 30 Deposits in transit P1,200 P1,500 Outstanding checks 670 840 The bank overlooked a check for P75 when recording a deposit on June 10 Note collected by bank, recorded after receiving the bank statement 1,800 NSF checks recorded after receiving

bank statement Service charge, recorded after receiving the bank statement Bored recorded a P374 check received from a customer in June as P347 26. The corrected balance per bank on June 30 is: (a) P9,085 (b) P9,160

560

480

45

60

(c) P9,235

(d) P10,075

27. The corrected June receipts per books is: (a) P11,575 (b) P13,300 (c) P13,346

(d) P13,375

D

28. The corrected June disbursements per books is: (a) P10,830 (b) P11,170 (c) P11,250

(d) P11,300

B

C...