PCPAR / OCPAR AFAR011

PAMPANGA CPA REVIEW

• 2F-E 295 Gloans Annex Bldg. Sto. Rosario St. Angeles City | @pcpareview | pampangacpareview@gmail.com ADVANCED FINANCIAL
ACCOUNTING AND
REPORTING
OLONGAPO CPA REVIEW
• Villagracia Building # 2019 Rizal Avenue, West Bajac-Bajac | @olongapocpareview | olongapocpareview2017@gmail.com
MAY 2024

GOVERNMENT ACCOUNTING

1. What is the title of the revised government accounting system for national government agencies
effective January 1, 2016?
a. Government Accounting Manual (GAM)
b. New Government Accounting System (NGAS)
c. Philippine Government Accounting System (PGAS)
d. National Government Accounting Manual (NGAM)

2. Under Article IX-D Section 2 of the 1987 Constitution of the Republic of the Philippines, it shall have
the exclusive authority, subject to the limitations in this Article, to define the scope of its audit and
examination, establish the techniques and methods required therefore, and promulgate accounting
and auditing rules and regulations, including those for the prevention and disallowance of irregular,
unnecessary, excessive, extravagant, or unconscionable expenditures, or uses of government funds
and properties. It shall also be responsible to keep the general accounts of the Government and, for
such period as may be provided by law, preserve the vouchers and other supporting papers pertaining
thereto.
a. Commission on Audit
b. Civil Service Commission
c. Commission on Election
d. Commission on Human Rights

3. The Government Accounting Manual aims to update the following, except

a. standards, policies, guidelines and procedures in accounting for government funds and
property
b. coding structure and accounts
c. accounting books, registries, records, forms, reports and financial statements.
d. scope and objectives of audit

4. It encompasses the processes of analyzing, recording, classifying, summarizing and communicating all
transactions involving the receipt and disposition of government funds and property, and interpreting
the results thereof.
a. Government auditing
b. Government reporting
c. Government accounting
d. Government analyzing

5. It refers to the financial plan of a government for a given period, usually for a fiscal year, which shows
what its resources are, and how they will be generated and used over the fiscal period.
a. Government budget
b. Government financial position
c. Government financial statements
d. Government financial performance

6. It refers to the step in the government budgetary process wherein the President, through the
assistance of the Department of Budget and Management, shall prepare and submit to the Congress a
budget of expenditures and sources of financing, including receipts from existing and proposed revenue
measures.
a. Budget Preparation
b. Budget Legislation or Authorization
c. Budget Execution
d. Budget Accountability

7. It refers to the step in the government budgetary process which involves the enactment by the
Congress of the General Appropriation Act (GAA) based on the budget submitted by the President
which cannot be increased by the Congress. The initiative for the enactment of the appropriation law
shall come from the House of Representatives.
a. Budget Preparation
b. Budget Legislation or Authorization
c. Budget Execution
d. Budget Accountability

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8. It refers to the step in the government budgetary process which involves the implementation of
the general appropriation act which includes the release of revenue allotment under the
supervision of the Department of Budget and Management.
a. Budget Preparation
b. Budget Legislation or Authorization
c. Budget Execution
d. Budget Accountability

9. It refers to the step in the government budgetary process which involves the submission of proper
documentary reports by a responsible officer, liquidation of expenditures and an audit conducted
by Commission on Audit to ensure the public funds are spent in accordance with the appropriation
act.
a. Budget Preparation
b. Budget Legislation or Authorization
c. Budget Execution
d. Budget Accountability

10. Under the Government Accounting Manual (GAM), the financial reporting system of the Philippine
government consists of accounting system on accrual basis and budget reporting system on budget
basis under the statutory responsibility of the National Government Agencies (NGAs), Bureau of the
Treasury (BTr), Department of Budget and Management (DBM), and the Commission on Audit (COA).
Which of the following is incorrect under the Government Accounting Manual?
a. Each entity of the National Government (NG) maintains a complete set of accounting books by
fund cluster which is reconciled with the records of cash transactions maintained by the BTr.
b. The BTr accounts for the cash, public debt and related transactions of the NG.
c. Each entity maintains budget registries which are reconciled with the budget records
maintained by the DBM and the Government Accountancy Sector (GAS), COA.
d. Each entity shall maintain Regular Agency (RA) Books and National Government (NG) Books
for the recording of its transactions.

11. The Government Accounting Manual enumerates the following components of the General-Purpose
Financial Statements of National Government Agencies, except
a. Statement of Financial Position
b. Statement of Financial Performance
c. Statement of Retained Earnings
d. Statement of Cash Flows
e. Statement of Changes in Net Assets/Equity
f. Statement of Comparison of Budget and Actual Amounts
g. Notes to the Financial Statements, comprising a summary of significant accounting policies
and other explanatory notes.

12. The books of accounts of NGAs under the GAM shall consist of the following, except
a. General Journal
b. Cash Receipts Journal
c. Cash Disbursement Journal
d. Regular Agency and National Government Books
e. Check Disbursements Journal
f. General Ledgers
g. Subsidiary Ledgers

13. The registries of National Government Agencies under the GAM shall consist of the following, except
a. Registries of Revenue and Other Receipts. (RROR)
b. Registry of Appropriations and Allotments. (RAPAL)
c. Registries of Allotments, Obligations and Disbursements (RAOD)
d. Registries of Budget, Utilization and Disbursements (RBUD)
e. Registries of Priority Development Assistant Program (RPDAP)

14. It refers to the registry maintained by the NGA unit to monitor the revenue and other receipts
estimated/budgeted, collected and remitted/deposited.
a. Registries of Revenue and Other Receipts. (RROR)
b. Registry of Appropriations and Allotments. (RAPAL)
c. Registries of Allotments, Obligations and Disbursements (RAOD)
d. Registries of Budget, Utilization and Disbursements (RBUD)

15. It refers to a registry maintained by the NGA unit to show the original, supplemental and final
budget for the year and all allotments received charged against the corresponding appropriation.
a. Registries of Revenue and Other Receipts. (RROR)
b. Registry of Appropriations and Allotments. (RAPAL)
c. Registries of Allotments, Obligations and Disbursements (RAOD)
d. Registries of Budget, Utilization and Disbursements (RBUD)

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16. It refers to a registry maintained by the NGA unit to show the allotments received for the year,
obligations incurred against the corresponding allotment and the actual disbursements made.
a. Registries of Revenue and Other Receipts. (RROR)
b. Registry of Appropriations and Allotments. (RAPAL)
c. Registries of Allotments, Obligations and Disbursements (RAOD)
d. Registries of Budget, Utilization and Disbursements (RBUD)

17. It refers to a registry maintained by the NGA unit to record the approved special budget and the
corresponding utilizations and disbursements charged to retained income authorized under the law
and other retained income collection of a national government agency with similar authority.
a. Registries of Revenue and Other Receipts. (RROR)
b. Registry of Appropriations and Allotments. (RAPAL)
c. Registries of Allotments, Obligations and Disbursements (RAOD)
d. Registries of Budget, Utilization and Disbursements (RBUD)

18. The following are the classifications of different RAPAL, RAOD and RBUD, except
a. RAPAL/RAOD/RBUD – Personnel Services
b. RAPAL/RAOD/RBUD – Maintenance and Other Operating Expenses c.
RAPAL/RAOD/RBUD – Financial Expenses
c. RAPAL/RAOD/RBUD – Capital Outlays
d. RAPAL/RAOD/RBUD – Noncash Expenses

19. On December 31, 20x1, the Department of the Interior and Local Government billed its lessee on one
of its buildings in the amount of P100,000. On January 31, 20x2, the DILG collected all of the accounts
receivable. On February 28, 20x2, the DILG remitted all the collected amounts to the Bureau of
Treasury. What is the journal entry to record the remittance to the Bureau of Treasury?
a. Debit – Rent Receivable P100,000 and Credit – Rent Income P100,000(Dec 31,20x1)
b. Debit – Rent Receivable P100,000 and Credit – Retained Earnings P100,000
c. Debit – Cash Collecting Officer P100,000 and Credit – Rent Receivable P100,000 (Jan 31,20x2)
d. Debit – Cash – Treasury/Agency Deposit, Regular – P100,000 and Credit Cash – Collecting Officer –
P100,000

20. On January 1, 20x1, the Department of Science and Technology received a P10,000,000 appropriation
from the national government for the acquisition of laboratory equipment. On February 1, 20x1, DOST
received the allotment from the Department of Budget and Management. On March 1, 20x1, DOST
entered into a contract with Express Manufacturing Inc. for the acquisition of the equipment with a
price of P8,000,000. On April 1, 20x1, DOST received the Notice of Cash Allocation from the Department
of Budget and Management net of 1% withholding tax for income tax of supplier and 5% withholding
of Final Tax on VAT of supplier. On May 1, 20x1, Express Manufacturing Inc. delivered the equipment
to DOST. On June 1, 20x1, DOST paid the obligation to Express Manufacturing Inc. On July 1, 20x1,
DOST remitted the withheld income tax and final VAT to BIR. What is the journal entry on March 1,
20x1?
a. No entry but just posting to appropriate registry --- Jan 1
b. No entry but just posting to appropriate registry --- Feb 1
c. No entry but just posting of ORS (Obligation Request and Status) March 1
d. Debit Equipment P8,000,000 and credit Accounts Payable P8,000,000

21. Using the same data in the preceding number, what is the journal entry on April 1, 20x1?
a. Debit Cash-MDS, Regular P7,520,000 and Credit Subsidy Income from National Government
P7,520,000.
b. Debit Equipment P8,000,000 and Credit Accounts Payable P8,000,000 ---May 1
c. Debit Accounts Payable P8,000,000 and Credit Due to BIR P480,000 and Cash-MDS, Regular
P7,520,000.
d. Debit Due to BIR P480,000 and Credit Subsidy Income from National Government P480,000. TRA
(Tax Remittance Advice)

22. On February 1, 20x1, the Department of Environment and Natural Resources (DENR) transferred
P450,000 fund to the Department of Public Works and Highway (DPWH) for the construction of DENR’s
irrigation project. The P450,000 fund was then remitted by DPWH to the Bureau of Treasury on May 1,
20x1. The project was completed and turned over by DPWH to DENR on October 31, 20x1. What is the
journal entry in DENR’s book to record the transfer of funds on February 1, 20x1?

a. Debit Due from DPWH P450,000 and Credit Cash, MDS, Regular P450,000.
b. Debit Cash-Treasury/Agency Deposit/Trust P450,000 and Credit Cash-Collecting Officers
P450,000.
c. Debit Cash Collecting Officers P450,000 and Credit Due to DENR P450,000
d. Debit Cash-Treasury/Agency Deposit/Trust P450,000 and Credit Cash-Collecting Officers
P450,000.

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23. Using the same data in the previous number, what is the journal entry of DPWH to record the turnover
of the irrigation project to DENR on October 31, 20x1?

a. Debit Due to DENR P450,000 and Credit Project Title account Account P450,000
b. Debit Project Title Account P450,000 and Credit Due from DPWH P450,000.
c. Debit Due to DENR P450,000 and Credit Cash-Collecting Officer P450,000
d. Debit Cash Collecting Officer P450,000 and Credit Due from DPWH P450,000.

24. The payroll accountant of Department of Foreign Affairs provided the following data concerning the
salaries of its officers and employees for the month ended December 31, 20x1:

Salaries and wages P510,000

Personal Economic Relief Allowance (PERA) 55,000
Gross compensation 565,000
Withholding income tax 51,000
GSIS 15,300
PAG-IBIG 10,200
Philhealth 510
Net P487,990

DFA received the notice of cash allocation from the DBM net of 10% tax on basic salary. Afterwards,
DFA granted cash advance to the cashier for the payroll. The DFA cashier paid the employees and
submitted the liquidation report of the payroll fund with the corresponding supporting documents.
DFA remitted the withheld tax to BIR and the withheld contribution to GSIS, PAG-IBIG and Philhealth.
What is the journal entry to recognize the grant of cash advance to the cashier for the payroll?

a. Cash – MDS, Regular 514,000

Subsidy Income from National Government 514,000

b. Salaries and Wages 510,000

PERA 55,000
Due to BIR 51,000
Due to GSIS 15,300
Due to PAG-IBIG 10,200
Due to Philhealth 510
Due to officers and employees 487,990

c. Advances for payroll 487,990

Cash-MDS, Regular 487,990

d. Due to officers and employees 487,990

Advances for payroll 487,990

e. Due to BIR 51,000

Subsidy Income from National Government 51,000

f. Due to GSIS 15,300

Due to PAG-IBIG 10,200
Due to PhilHealth 510
Cash – MDS, Regular 26,010

25. The Department of Justice received a Notice of Cash Allocation in the amount of P1,500,000 from DBM.
The DOJ made a total cash disbursement in the amount of P1,225,00. What is the journal entry to
recognize reversion of unused Notice of Cash Allocation by DOJ in its books?
a. Debit Subsidy Income from National Government P275,000 and credit Cash-MDS, Regular
P275,000.
b. Debit Retained Earnings P275,000 and credit Cash-MDS, Regular P275,000.
c. Debit Expenses P275,000 and credit Cash-MDS, Regular P275,000.
d. Debit Investment P275,000 and credit Cash-MDS, Regular P275,000.

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26. Which of the following closing entries in the accounting book of the Department of Transportation and
Communications is incorrect if the following data are provided by its chief accountant?
Total Income, aside from SING P1,598,000
Total expenses 791,652
Total Subsidy Income from National Government 1,181,882

a. Income account other than SING 1,598,000

Revenue and Expense Summary account 1,598,000

b. Revenue and Expense Summary account 791,652

Expense account 791,652

c. Subsidy Income from National Government 1,181,882

Revenue and Expense Summary Account 1,181,882

d. Revenue and Expense Summary Account 1,988,230

Accumulated Surplus/(Deficit) 1,988,230

e. Ordinary shares 3,931,534

Share premium 3,931,534

27. On January 31, 20x1, the collecting officer of the Bureau of Customs collected P350,000 import duties
plus fines of P10,000 on the goods of an importer. On February 28, 20x2, the Bureau of Customs
remitted the P360,000 to the Bureau of Treasury. What is the journal entry to record the collection of
the import duties and fines?

a. Debit Cash-Collecting Officer P360,000 and Credit Import Duties P350,000 and Fines/Penalties
P10,000.
b. Debit Cash-Treasury/Agency Deposit, Regular P360,000 and Credit Cash-Collecting Officer
P360,000.
c. Debit Cash-Treasury/Agency Deposit, Regular. P360,000 and Credit Import Duties P350,000 and
Fines/Penalties P10,000.

28. Using the same data in the preceding number, but assuming the importer directly deposited the
350,000 import duties and P10,000 fines through Authorized Agent Banks instead of collection by a
customer collecting officer, what is the journal entry to record the collection/remittance of import duties
and fines to the Bureau of Treasury?

a. Debit Cash-Collecting Officer P360,000 and Credit Import Duties P350,000 and Fines/Penalties
P10,000.
b. Debit Cash-Treasury/Agency Deposit, Regular P360,000 and Credit Cash-Collecting Officer
P360,000.
c. Debit Cash-Treasury/Agency Deposit, Regular P360,000 and Credit Import Duties P350,000 and
Fines/Penalties P10,000.

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