1.

The entry to record the cancellation of a spoiled MDS check that was issued in the
same quarter will include a debit to the account Subsidy from National Government. *

This statement is true.

This statement is not true.
2. A cash overage is recognized as *
Other Service Income.
Income from Grants and Donations.
Miscellaneous Income.
Subsidy from National Government.
3. Which of the following statements is true about the overpayment of salaries and
wages during the current year? *

In recording the overpayment of salaries, the payroll fund account is decreased.

In recording the overpayment of salaries, Salaries and Wages account is decreased.
To record the receipt of refund of overpayment, Cash - Disbursing Officer is debited.
To record the receipt of refund of overpayment, the payroll fund account is credited.

4. In the event that the cash advance granted exceeds actual traveling expense
incurred, *

A disbursement voucher shall be prepared to claim reimbursement of the excess cash

advance
The Liquidation Report shall state the actual traveling expense in the same amount as the
cash advance.
The excess cash advance shall be refunded to the agency and the employee will be
issued an official receipt.
The excess cash advance can be used to defray future traveling expenses.

5. This account shall be credited to recognize the receipt of refund relative to the
overpayment of repair expense in the previous year, when overpayment was not taken
up as a receivable. *
Other Receivables
The related repair expense account
Cash - Collecting Officer
Accumulated Surplus/ Deficit
6. Restitution of cash shortage by the collecting officer is recorded as *

debit to Cash - Collecting Officer and credit to Due from Officers and Employees.
debit to Due from Officers and Employees and credit to Cash - Collecting Officer.
debit to Other Services Income and credit to Cash - Collecting Officer.
debit to Cash - Collecting Officer and credit to Other Services Income.

7. To record the deposit of the refund for overpayment of salaries and wages in the
current year, *

Due from Officers and Employees is credited.

Cash - Collecting Officer is credited.
Cash - Treasury/ Agency Deposit, Regular is credited.
Salaries and Wages account is credited.

8. When a check is dishonored in the year subsequent to the deposit of the collection, the
account Cash - Treasury/ Agency Deposit, Regular is reduced upon recognition of the
dishonored check. *

This statement is true.

This statement is not true.

9. The deposit of the settlement of disallowance shall be recorded by debiting

Accumulated Surplus/ Deficit when the disallowance was for a transaction in the prior
year. *

This statement is true.

This statement is not true.
10. When a commercial check that was issued in the prior year becomes spoiled in the
current year, the account Accumulated Surplus/ Deficit shall be debited upon
recognition of the cancellation of the said check. *

This statement is true.

This statement is not true.
11. To record a dishonored check, what account is debited? *

Cash- Collecting Officer

Other Receivables
Due from Officers and Employees
Accounts Receivable

12. Which of the following statements is not true? *

The replacement of a stale MDS check will be recorded as a debit to Accounts Payable
and credit to Cash - MDS Regular, regardless of when the stale check was issued.

The cancellation of a stale commercial check will be recorded as a debit to Cash - MDS
Regular and credit to Accounts Payable, regardless of when the stale check was issued.

The cancellation of a spoiled MDS check will be recorded as a debit to Cash - MDS
Regular and credit to Accounts Payable if check was issued in the same quarter.

The cancellation of a stale MDS check will be recorded as a debit to Accumulated

Surplus/ Deficit and credit to Accounts Payable if the check was issued in the prior year.

13. To recognize the replacement of a stale MDS check issued in the prior year, Accounts
Payable shall be debited. *

This statement is true.

This statement is not true.

14. To recognize the cash shortage of the collecting officer, this account shall be
credited. *

Due from Officers and Employees

Cash - Treasury/ Agency Deposit, Regular
Cash - Collecting Officer
 Cash - Treasury/ Agency Deposit, Trust.

15. When a request for relief from accountability for shortages or loss of funds is granted,
the recording of the loss includes a credit to *

The appropriate asset account.

The appropriate receivable account.
Cash - Collecting Officer account.
Loss of Assets account.

16. The cancellation of a stale MDS check that was issued in the current year will be
recorded as *

debit to Subsidy from National Government and credit to Accounts Payable.

debit to Accounts Payable and credit to Cash- National Treasury MDS.
debit to Accumulated Surplus/ Deficit and credit to Accounts Payable.
debit to Subsidy Income from National Government and credit to Cash- National Treasury
MDS

17. To recognize the restitution of the cash shortage by the collecting officer in the
subsequent year, this account shall be debited. *

Cash - Collecting Officer

Accumulated Surplus/ Deficit
Due from Officers and Employees
Cash - Treasury/ Agency Deposit, Regular

18. In the cancellation of a stale MDS check issued in the prior year, this account shall be
debited. *

Subsidy from National Government

Cash - MDS, Regular
Accounts Payable
Accumulated Surplus/ Deficit
19. Which of the following can be inferred when a cash shortage by the disbursing officer
is identified? *

The total collection is greater than the related deposits made and undeposited cash.
The cash advance granted is greater than the actual disbursement made.
The total collection is less than the related deposits made and undeposited cash.
The actual disbursement is greater than the cash advance granted.

20. When a check is dishonored, the cancellation of the official receipt will result to an
adjustment in the deposited collections. If the check was dishonored in the same year
the check was deposited, *

The income account should be reduced in the adjustment.

Cash - Collecting Officers account will be reverted.
Cash - Treasury/ Agency Deposit account will be reverted.
The income account should be increased in the adjustment.

21. Which of the following statements is not true about the refund of excess cash
advance? *

The entry to record the refund of excess cash advance (for the payment of salaries)
includes a credit to Advances for Payroll.

The entry to record the refund of excess cash advance (for traveling expense) includes a
credit to Advances to Officers and Employees.

If the cash advance was granted in the prior year, the subsequent deposit of the excess
cash advance refunded will be recorded as a reduction in the account Subsidy from
National Government.

If the cash advance was granted in the current year, the subsequent deposit of the excess
cash advance refunded will be recorded as a debit to the account Cash - Treasury/
Agency Deposit, Regular.

22. I. The accountability of the accountable officer over the loss of depreciable asset shall
be based on its book value.
 II. A receivable account shall be set up to record the accountability of the accountable
officer simultaneous with the derecognition of the lost PPE. *

Both statements are true.

Only the first statement is true.
Only the second statement is true.
Neither statement is true.

23. I. To recognize the cancellation of prior year's deposited collections due to dishonored
checks, the corresponding Cash - Treasury/ Agency Deposit account shall be reverted.

II. To recognize the remittance of the replacement of dishonored check, the

corresponding Cash - Treasury/ Agency Deposit account shall be debited. *

Only Statement I is correct.

Only Statement II is correct.
Both statements are correct.
Both statements are incorrect.

24. I. Dishonored checks shall remain in the custody of the Disbursing Officer, pending
their redemption.
II. Upon settlement of the dishonored check in the prescribed manner, the Collecting
Officer shall not return the check to the payor concerned unless the latter first
surrenders the previous OR thereof. *

Only Statement I is correct.

Only Statement II is correct.
Both statements are correct.
Both statements are incorrect.
25. To record the cancellation of a stale MDS check that was issued in the previous year, *

The cash account is restored for the amount of the stale check.
The account Subsidy from National Government is debited.
Accumulated Surplus/ Deficit account is debited for the amount of the stale check.
The account Subsidy from National Government is credited.
26. If after the liquidation of cash advance for travel the total expenses incurred exceed
the amount of the cash advance, *

The collecting officer will direct payment of the excess from the employee who was
granted cash advance.

The agency has a right to collect a refund from the employee equivalent to the difference
computed.

The employee has to prepare a DV necessitating the reimbursement of the excess

travelling expense incurred.

No further settlement is needed.

27. Which of the following statements is incorrect about audit disallowances? *

To take up disallowances, the account Receivables- Disallowances/ Charges is debited.

If an audit disallowance was issued for excessive payments made for the repair of motor
vehicle in the previous year, the account Accumulated Surplus/ Deficit is credited in
recording the disallowance.

If the disallowance was not taken up in the books, the collection of the settlement will be
recorded directly as an increase in cash and the expense account will be adjusted.

If an audit disallowance was issued for excessive payments made for the repair of motor
vehicle in the current year, the account Accumulated Surplus/ Deficit is debited in
recording the subsequent remittance of the settlement.
28. If a contractor was issued with a Notice of Disallowance for the construction of office
building, the same shall be recorded in the books of the national government agency
by crediting which account when the project was already turned over and accepted? *

Office Building
CIP - Buildings and Other Structures
Accumulated Surplus/ Deficit
 Receivables - Disallowances/ Charges

29. During an audit, the auditor of Agency BB discovered that an IT equipment costing
P45,000, with an accumulated depreciation of P16,200 was lost due to theft. With this,
a loss will be recognized by *

debiting Accumulated Surplus/ Deficit for P28,800.

debiting Loss of Assets for its depreciated replacement cost.
debiting Accumulated Surplus/ Deficit for its depreciated replacement cost.
debiting Loss of Assets for P28,800.

30. To record the deposit of the restituted cash shortage by the collecting officer in the
current year, *

Cash - Collecting Officer is debited.

Due from Officers & Employees is credited.
Advances for Payroll is credited.
Cash - Treasury/ Agency Deposit, Regular is debited.

31. To set up the accountability of the accountable officer over the loss of a PPE due to
theft, what account shall be credited? *

ICT Equipment
Other Deferred Credits
Miscellaneous Income
Due from Officers and Employees

32. The entry to record the collection of refund for overpayment of salaries, when a
receivable account was not taken up, will include *

a credit to Due from Officers and Employees account.

a credit to Accumulated Surplus/ Deficit, when collection is in the ensuing year .
a credit to Salaries and Wages account, when collection is in the ensuing year.
a credit to Cash- Collecting Officer, when collection is in the current year.
33. To recognize the remittance of the refund of excess cash advance for operating
expenses, when collection is in the same year, this account shall be credited. *

Cash - Collecting Officer

Cash - Treasury/ Agency Deposit, Regular
Accumulated Surplus/ Deficit
Advances for Operating Expenses

34. This account is used to record the amount due from officers and employees and those
outside of government agencies for audit disallowances or charges, which may
become final and executory. *

Other Receivables
Due from Officers and Employees
Receivables - Disallowances/ Charges
Accounts Receivable

35. In the cancellation of a stale MDS check issued in the current year, this account shall
be debited. *

Subsidy from National Government

Cash - MDS, Regular
Accounts Payable
Accumulated Surplus/ Deficit

36. To recognize the replacement of dishonored check, the corresponding Cash -

Treasury/ Agency Deposit account shall be debited. *

This statement is true.

This statement is not true.

37. What is the journal entry to record the remittance to the Bureau of Treasury of any
refund of excess cash advance for travel if the amount was refunded in the same year
of the grant? *
 Debit to Cash - Collecting Officer and credit to Advances to Officers and Employees.
Debit to Subsidy from National Government and credit to Cash- Collecting Officer.
Debit to Cash - Treasury/ Agency Deposit, Regular and credit to Cash - Collecting
Officer.
Debit to Accumulated Surplus/ Deficit and credit to Cash- Collecting Officer.

38. A disbursing officer requested for relief from accountability arising from shortage of
fund. However, the request was denied and the disbursing officer settled his
accountability and was issued receipt for the settlement. The journal entry to record
said receipt of the settlement is *

debit to Cash- Collecting Officer and credit to Miscellaneous Income.

debit to Cash- Collecting Officer and credit to Accounts Receivable.
debit to Cash- Collecting Officer and credit to Due from Officers and Employees .
debit to Cash- Collecting Officer and credit to Receivables- Disallowances/ Charges.

39. To take up the cancellation of a voided MDS check issued in the same quarter, what
account shall be debited? *

Subsidy from National Government

Cash - MDS, Regular
Accounts Payable
Accumulated Surplus/ Deficit

40. To recognize the remittance of the refund of excess cash advance for operating
expenses, when collection is in the subsequent year, this account shall be debited. *

Cash - Collecting Officer

Cash - Treasury/ Agency Deposit, Regular
Accumulated Surplus/ Deficit
Advances for Operating Expenses