ST.

SCHOLASTICAS COLLEGE
Leon Guinto, Manila

ACCOUNTING FOR NON GOVERNMENT PROF. ROEL E. HERMOSILLA

GOVERNMENT ACCOUNTING QUIZ 3

1. Separate registries shall be maintained to control the allotments. When should allotments
be recorded in the registries?
A. At the beginning of the year
B. Quarterly
C. When money of the government is already disbursed
D. At the end of the year

2. As specifically provided for in the New Constitution, no money shall be paid out of the
National Treasury EXCEPT in the presence of
A. Budget
B. President’s executive order
C. Fund
D. Appropriation

3. It is the legislative authorization to make payments out of government funds under

specified conditions and specified purposes
A. Appropriation
B. Allotment
C. Obligation
D. Budgeting

4. It is the authorization from the Department of Budget and Management to an agency to

incur obligation up to a specified amount that must be within the legislative appropriation
A. Obligation
B. Appropriation
C. Allotment
D. Fund release

5. It is the amount committed to be paid by the government arising from an act of a duly
authorized administrative officer and which binds the government to the immediate and
eventual payment of money.
A. Obligation
B. Appropriation
C. Allotment
D. Commitment

6. It is the functions and activities necessary for the performance of a major purpose for
which a government entity is established.
A. Program
B. Project
C. Resources
D. Internal control

7. In government accounting, which of the following is a capital outlay?

A. Salaries and Wages
B. Repairs and maintenance
C. Land improvement
D. Merchandise inventory

8. It is the annual documents required at the onset of the budget execution phase, which
contain the agencies targets and plans for the current year.
A. Agency Budget Matrix (ABM)
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B. Annual Cash Program (ACP)

C. Budget Execution Documents (BEDs)
D. Budget Accountability Report (BARs)

9. Which of the following is other current assets account?

A. Other prepaid expenses
B. Deposits on letters of credit
C. Guarantee deposits
D. Advanced to contractors

10. The account used to record reduction in the value of trade receivable accounts, which
estimated as uncollectible based on COA standard/policies.
A. Allowance for bad debts
B. Allowance for doubtful accounts
C. Bad debts expense
D. Doubtful accounts expense

11. Which of the following is not a personal service expense?

A. Cash gift
B. Transportation allowance
C. Representation allowance
D. Travelling expenses

12. Which of the following is not an intermediate account?

A. Income and expense summary
B. Government equity
C. Cost of goods sold
D. Retained operating surplus

13. Which of the following is considered as maintenance and other operating expense?
A. Bank charges
B. Interest expense
C. Documentary stamps expense
D. Loss of assets

14. Which of the following is financial expense?

A. Debt service subsidy to Government Owned and Controlled Corporations
B. Tax refund
C. Bad debt expense
D. Miscellaneous expenses

15. In the new standard chart of accounts of the NGAs, the receivable accounts include all
except
A. Due from officers and employees
B. Currency swap receivable
C. Due from national treasury
D. Interest receivable

Items 16 and 17 are based on the following:

Agency A is a National Government with an NCA from the DBM for MOOE amounting to
P5,500,000. Of the total amount, P 4,675,000 was obligated and 80% was paid. The remaining
20% was recognized as accounts payable.

16. How much is the un-obligated balance that should be shown in the Registry of Allotment and
Obligation-MOOE?
A. P 825,000

17. How much is the utilization rate of obligation?

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C. 85%

18. Mildred is the cashier of DILT a national government. During the month, she received total
collections from earnings amounting to P 250,000 of which P 150,000 was income that should be
deposited to the National Government and the P100,000 was income received from its own
agency operation. The P 150,000 was deposited to the National Treasury and the remaining
balance was deposited to the agency bank account. What should be the entry to record the
deposit of the collections received by the collecting officer?
B. Due to National Treasury 108 150,000
Cash in Bank Current Account 111 100,000
Cash Collecting Officer 102 250,000

19. Milan is an employee of national government agency. Milan was granted and received cash
advance of P 30,000 for its official travel. Milan liquidated the cash advance as follows:
Travel expenses P 10,000
Training expenses 10,000
Representation expenses 8,000
Total P 28,000

The amount advanced had an un-liquidated balance of P 2,000. What is the appropriate entry to
record the liquidation of the cash advance?
D. Travel expenses 10,000
Training expenses 10,000
Representation expenses 8,000
Cash Collecting Officer 2,000
Due from officers and Employees 30,000

Items 20 - 24 are based on the following:

ACE, a national government agency unit incurs an obligation for the purchase of garbage truck for
P 450,000 on March 15, 2018. The dump truck is to be delivered on March 31, 2018 and the motor
firm has agreed for a 30-day, interest free-delayed payment, i.e. payable on April 30, 2018.
Assume a 12% tax on the purchase covered by TRA:

20. On March 15, 2018, the entry to be recorded by ACE will be:
D. Memorandum entry in RAOCO

21. On March 31, 2018, the entry to be recorded by ACE will be:
A. Equipment 450,000
Accounts payable 450,000

22. On April 30, 2018, the entry to be recorded by ACE will be:
C. Accounts payable 450,000
Cash - NT - MDS 396,000
Due to BIR 54,000

23. The entry to ACE to record to subsequent disposal of the withheld tax will be:
C. Due to BIR 54,000
Subsidy income from NG 54,000

24. Department ABC and agency of the national government receives Notice of Cash Allocations
(NCA) from Department of Budget and Management (DBM) of P2, 000,000 out of its appropriation
of P5, 000,000.
Under the New Government Accounting System (NGAS), the entry to record the above in the
Regular Books of Department ABC is as follows:
B. Cash, National Treasury-MDS 2,000,000
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Subsidy Income from National Government 2,000,000

25. Department DEF issued a purchase order (PO) for the acquisition of office equipment costing
P350, 000. The same was paid by check after withholding tax of 10%.

The obligation of P350, 000 is recorded in the Registry of Allotment and Obligation, Capital Outlay
(RAOCO). The entry to record the payment is:
A. Accounts Payable 350,000
Due to BIR 35,000
Cash, National Treasury-MDS 315,000

26. Agency GHI signed a contract for the acquisition of a building. The contract price is P15, 000,000.
The agency paid the required 30% of the contract price as down payment. After three months of
construction Agency GHI received the first billing of 50 % of the contract price. The entry to record
the first billings in the Regular Books of Agency GHI is:
A. Construction in Progress 7,500,000
Advances to Contractor 4,500,000
Accounts Payable 3,000,000

27. The approved appropriation of Department X for 2017 was P18,000,000. Eighty five percent of
this appropriation was allotted by the Department of Budget and Management (DBM)
accompanied with Notice of Cash allocation (80%) of the allotment. During the year, the amount
of obligations incurred was equivalent to ninety percent of the NCA but only seventy percent of
these obligations were paid by checks. Determine which of the following is incorrect.
A. At the end of the year, to adjust the unused NCA, Cash-NT-MDS would be credited by
P7,711,200

28. Bank charges per bank statement, P7,500; Interest expense upon receipt of Bill, P9,000. Based
on the given information, which of the following is not correct?
A. Entry to record the bank charges in the regular agency books would include a credit to
Cash-NT-MDS

29. Which of the following would be included in an entry to record the remittance of income taxes to
the Bureau of Treasury (BTR) collected by the Bureau of Internal Revenue (BIR)? The BIR has no
authority to use the collections.
C. Credit to Cash – Collecting officer

30. Agency B collected cash of P50,000 for services rendered. The collection was deposited to the
Bank of the Philippines Islands (BPI). What is the entry to record the deposit?
C. Debit, Cash in Bank – LCCA and Credit, Cash – Collecting officer for P50,000

31. During 2018, Agency C transferred cash of P100,000 to Agency D for a land beautification project.
Subsequently, Agency C received a report from Agency D about the project. Which of the
following is incorrect?
C. Receiving Agency credits Cash-NT-MDS upon receipt of cash

32. On September 10, 2018 Bureau of Customs collected taxes from articles in the amount of
P875,000. The BC has no authority to use these collections in their operation and therefore
deposited it to the Bureau of Treasury. What is the journal entry to record the collections in the
National Government Books?
D. Cash - in Bank – LCCA 875,000
Excise taxes – Articles 875,000

33. Agency RR issued a purchase order for the acquisition of office equipment costing P75,000. The
equipment was received with the charge invoice and was paid by check after withholding tax of
10%. Agency RR remitted the tax withheld to BIR thru a government depository bank. What is
the entry of Agency RR to record the payment?
A. Accounts Payable 75,000
Due to BIR 7,500
Cash-National Treasury-MDS 67,500

34. Collection of P645,000 representing motor vehicles registration fees was recorded by Land
Transportation Office as P654,000. What is the correcting entry under the NGAS?
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D. Registration Fees 9,000

Cash – Collecting Officer 9,000

35. On January 1, 2020, the Department of Agriculture (DA) received a P10,000,000 appropriation
from the national government for the acquisition of construction machinery. On February 1, 2020,
DA received the allotment from the Department of Budget and Management. On March 1, 2020,
DA entered into a contract with Entity A for the acquisition of the machinery with a price of
P8,000,000.

On April 1, 2020, DA received the Notice of Cash Allocation from Department of Budget and
Management net of 1% withholding tax for income tax supplier and 5% withholding of Final Tax on
VAT of supplier. On May 1, 2020, Entity A delivered the machinery to DA. On June 1, 2020, DA
paid the obligation to Entity A. on July 1, 2020, DA remitted the withheld income tax and final VAT
at BIR.

The receipt of notice of cash allocation by a national government agency shall credited to
C. Subsidy income from national government

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