PRELIMINARY EXAM

Government Accounting and Accounting for Non-Profit Organizations

Name: ________________________________________________________ Score: ________

I. Multiple Choice. Choose the letter of the best answer. Write it on the space provided
before the number. Use CAPITAL LETTERS only. (2 pts each)

_______1. The receipt of an allotment is recorded by a government entity in the _______.

A. RAOD
B. ORS
C. RAPAL
D. A and C

_______2. The incurrence of an obligation for future delivery or performance by the obligee is
recorded by a government entity in the _______.
A. RAOD
B. ORS
C. RAPAL
D. A and B

_______3. The receipt of an appropriation is recorded by a government entity in the _______.

A. RAOD
B. ORS
C. RAPAL
D. A and B

_______4. The entry to record a receipt of Notice of Cash Allocation (NCA) by a government
entity is:
A. (Debit) Cash Modified Disbursement System (MDS), Regular, (Credit) Accumulated
Surplus (Deficit)
B. (Debit) Cash Modified Disbursement System (MDS), Regular, (Credit) Subsidy from
National Government
C. (Debit) Cash Collecting Officer, (Credit) Subsidy from National Government
D. No Journal Entry, the event is recorded only in the registries

_______5. According to the Revised Chart of Accounts (RCA), issued by the COA the “Subsidy
from the National Government” account is a/an __________.
A. Asset Account
B. Liability Account
C. Revenue Account
D. Equity Account
_______6. Which of the following is NOT one of the necessary closing entries of a Government
entity?
A. Closing of the “Cash Treasury/ Agency Deposit, Regular” Account to the “Accumulated
Surplus/ Deficit” Account
B. Closing of the “Subsidy from National Government” Account to the “Revenue and
Expense Summary” Account
C. Closing of Income and Expense Accounts to the “Revenue and Expense Summary”
Account
D. Closing of the Net Balance of “Revenue and Expense Summary” Account to the
“Subsidy from National Government” Account

_______7. A Government Entity pays an Accounts Payable. The entry to record the payment
will most likely include a _________.
A. Debit to the “Cash Modified Disbursement System (MDS), Regular” Account
B. Credit to the “Due to BIR” Account
C. Credit to the “Cash Treasury/ Agency Deposit, Regular” Account
D. None of these. The event only in the registries and the obligation request and status

_______8. In accordance with the GAM for NGAs, and the Revised Chart of Accounts (RCA),
how does a government entity recognize the uncollectibility of Account Receivable?
A. By debiting the “Bad debts expense” Accounts
B. B
By debiting the “Impairment Loss Loans and Receivables” Account
C. By debiting the “Allowance for Impairment Accounts Receivable” Account
D. B and C

_______9. The “Subsidy from National Government” Account is credited when recording a
__________.
A. Receipt of NCA
B. Reversion of unused NCA
C. Constructive Remittance of Customs Duties or Taxes withheld through TRA
D. A and C

_______10. Expenditures to acquire long term assets are most likely classified as _________.
A. Personal Services (PS)
B. Maintenance and Other Operating Expenses (MOOE)
C. Financial Expenses (FE)
D. Capital Outlays (CO)

Problem. Provide the Journal Entry to record each of the independent transactions or events
below. If no Journal Entry is needed, state the registry or other document where the transaction
event is recorded.

1. Receipt of Php. 1, 000, 000.00 NCA

2. Remittance to the BIR of Php. 100, 000.00 Taxes Withheld
3. Receipt of Php. 1, 000, 000.00 Allotment
4. Receipt of Php. 1, 200, 000.00 Appropriation
5. Entering into a Purchase Contract for future delivery. The contract price is Php. 500,
000.00
6. Entering into employment contracts worth Php. 200, 000.00
7. Billing of Php. 250, 000.00 Revenue for Affiliation Fees, subsequent collection of Php.
200, 000.00 therefrom and full remittance of the collection to the BTr
8. Reversion of Php. 50, 000.00 unused NCA
9. Receipt of Office Equipment purchase on account for Php. 100, 000.00
10. Payment of Accounts Payable from Purchase of Office Supplies worth Php. 60,000.00.
Tax Withheld amount to Php. 3, 000.00