INTERMEDIATE ACCOUNTING 1 PROBLEM I: Banchero Company had the following cash

CASH AND CASH EQUIVALENTS balance on July 31, 2021:

Undeposited coins and currencies 40,000

Cash - refers to money or its equivalent that is
Unrestricted demand deposits 1,660, 000
readily available for unrestricted use
Company checks written (and deducted
- The world’s most widely used medium of
from the above demand deposits) but
exchange and the foundation for accounting
not scheduled to be mailed until
measurements
August 2, 2021 370,000
- Includes money and any negotiable
90-day time deposit (restricted) 3,000,000
instruments that is payable in money
acceptable by bank for deposit and
In exchange for a guaranteed line of credit, Banchero
immediate credit. In other words, cash does
has agreed to maintain a minimum balance of P150,000
only pertain to money itself, it may also
in its unrestricted demand deposits account.
include checks, bank drafts, and money
order because these are acceptable by
How much is the correct cash to be reported in the
banks for deposit or available for immediate
statement of financial position as of July 31, 2021?
encashment.
Cash Equivalents – refers to highly liquid investments
that are acquired within three (3) months before
PROBLEM II: The cash account of Manuel Corporation
maturity.
as of December 31, 2021 consist of the following:
.
Terms to study Cash collections not yet
1. Unrestricted cash deposited to the bank P450,000
2. Bank drafts Check drawn by the vice president
3. Money orders dated January 16, 2022 80,000
4. Cash on hand/Cash in bank Check drawn by a supplier dated
5. Postdated checks December 28, 2021 for goods
6. Undelivered checks returned by the company 50,000
7. Stale checks Petty cash fund, of which P9,000 is in
the form of currencies; P9,000 in
8. Bank overdrafts
the form of employees' IOUs;
9. Compensating balance
and P3,000 is supported by approved
10. Window Dressing petty cash vouchers for all expenses
11. Lapping dated prior to the closing of the books
12. Check Kiting on December 31, 2021 21,000
13. NSF (Not Sufficient Fund)/ Drawn against TOTAL 601,000
insufficient fund (DAUD)/Drawn against
Uncleared Deposits (DAIF) What is the amount of cash to be reported on the December 31,
14. Cash Overage/(Cash Shortage) 2021, statement of financial position?
15. Petty Cash Fund
16. Imprest Fund System
17. Fluctuating Fund System
PROBLEM III: At year-end, Abueva company reported cash and PROBLEM V: Edwards Company's adjusted cash and cash
cash equivalents following: equivalents balance at December 31, 2021 is:

Cash on hand P900,000

Demand deposit 8,250,000 PROBLEM VI: Locsin Company wants to determine the amount of
Certificate of deposit 3,000,000 cash to be reported on its December 31, 2021 balance sheet. The
Post-dated customer check 600,000 following information is provided:
Petty cash fund 120,000
Traveler's check 80,000  Travel advances of P175,000 for executive travel for the first
Manager's check 210,000 quarter of next year (employee to reimburse through salary
Money order 100,000 reduction).
 Currency and coins on hand amounted to P4,200.
What total amount shall be should be reported as cash at year-  A bank overdraft of P23,000 has occurred at one of the
end? banks the company uses to deposit its cash receipts. At the
present time, the company has no other deposits in this
PROBLEM IV: Tenorio Company reported the checkbook balance bank.
on December 31, 2021 at P10,300,000 and held the following  A separate fund in the amount of P1,320,000 is restricted for
items on same date: the retirement of long-term debt.
 Petty cash fund, P3,400.
Check payable to Tenorio, dated January 5, 2022 in payment of a  Commercial savings account of P950,000 and a commercial
sale made in December 27, 2021, not included in December 31 checking account balance of 590,000 are held at Aces
checkbook balance. P3,000,000 Banking Corporation.
 An IOU from Ross Geller, a company officer, in the amount of
Check payable to Tenorio, deposited December 15 and included in P5,000.
December 31 checkbook balance, but returned by bank on  The company has two certificates of deposit, each totaling
December 30 stamped "NSF". The check was redeposited on P430,000. These certificates of deposit have a maturity of
January 2, 2022 and cleared on January 5, 2022. P1,300,000 120 days.
 Locsin Company has received a check that is dated January
Check drawn on Tenorio's account, payable to a vendor, dated and 12, 2022 in the amount of P152,000.
recorded in Tenorio's books on December 31, 2021 but not mailed
until January 10, 2022. P600,000 Locsin Company's adjusted cash and cash equivalents balance on
December 31, 2021 is:
Certificate of time deposit - 3 months. P600,000

What amount should be reported as cash on December 31, 2021?

PROBLEM V: On December 31, 2021, the checking of financial

statements of Edwards Company reveal the following:
Current account at ILY bank (P35,000)
Current account at ILLY bank 56,000
Treasury bills (acquired 3 months before maturity) 250,000
Treasury bills (maturity date is 12/31/22) 595,000
Payroll account 259,000
Foreign bank account-restricted (translated) 1,000,000
Postage stamps 640
Employees' checks marked "DAIF" 8,000
IOU from the vice-president 59,000
Credit memo from a supplier for a purchase return 54,000
Traveler's check 75,000
Money order 24,000
Company's check dated 12/30/21 but not
mailed at year-end 33,000
Petty cash fund (P2,500 in currency
and expense receipts for 4,500) 7,000 COMPREHENSIVE PROBLEMS
 PROBLEM VIII: On December 31, 2021, the accountant for Ty Inc,
PROBLEM VII: On December 31, 2020, Pudge Company's cash and re-examined the petty cash fund. The petty cash presented the
cash equivalents account balance per ledger of P1,000,000 following during the count:
includes the following:
Currencies 2,350
Demand deposit P550,000 Petty cash vouchers:
Undeposited collection 75,000 Postage 200
Time deposit - 30 days 125,000 Office supplies expense 320
NSF customer check 5,000 Transportation expense 440
30-day money market placement due 1/28/2021 75,000 Computer repairs 850
60-day commercial papers due 2/4/2021 20,000 Advances to office staff 1460 3,270
Savings deposit in closed bank 12,500 A check drawn by Ty Inc, payable to
IOU from an employee 37,500 the petty cash custodian 4,100
Preferred redemption fund 100,000 Postage stamps 300
TOTAL 1,000,000 An employee's check, returned by bank,
marked “NSF” 900
Additional information: An envelope containing
currencies with a note "For Amando"* 2,190
a) Included in the demand deposit of P550,000 was a TOTAL P17,500
customer check amounting to P12,500 dated January 25,
2021. *Amando is a retiring employee

b) Also included in the demand deposit is a customer check The general ledger shows an Imprest fund cash balance of
amounting to P22,500 dated December 31, 2019. The P17,500.
company neglected to encash the check. On December
31, 2020, the customer was informed and he was willing 1. What is the petty cash shortage or overage?
to replace this with a new one. New check is yet to be 2. What is the adjusted balance of the petty cash fund on
received from the customer. December 31, 2020?

c) Check of P15,000 dated January 31, 2021 in payment of

accounts payable was recorded and mailed December 31,
2020.

d) Check of P17,500 in payment of accounts payable was

recorded on December 31, 2020 but mailed to creditors
on January 15, 2021.

e) The company uses the calendar year. The cash receipt

journal was held open until January 15, 2021 during
which time P20,000 was collected and recorded on
December 31, 2020.

Requirements:
1. Prepare journal entry to correct the cash count.
2. Compute the cash and cash equivalents to be presented
on December 31, 2020 statement of financial position.