PROBLEM - BASIC RECORDING OF GOVERNMENT TRANSACTIONS AND

WORKSHEET PREPARATION

Entity DMV is a newly formed government agency. Entity DMV transactions and events
during the calendar year 2022 are as follows;

a. Received appropriation of ₱600,000

b. Received allotment of ₱550,000
c. Incurred obligations amounting to ₱540,000
d. Received Notice of Cash Allocation of ₱530,000
e. Accrued ₱80,000 salaries through granting, and liquidation of cash advance. The
breakdown of the salaries is as follows:
Salaries and Wages ₱70,000

Personal Economic Relief Allowance (PERA) 10,000

Gross Compensation 80,000

Withholding Tax 18,000

GSIS 4,000

Pag-ibig 1,000

Philhealth 2,000

Total Salary Deductions 25,000

f. Received Delivery of purchased office equipment worth ₱200,000. The equipment has
an estimated useful life of 5 years and a 5% residual value. Entity ADM recognizes
monthly depreciation every end of the month using the straight-line method. The
equipment is acquired on January 1, 2021.
g. Paid the accounts payable from the purchase of equipment in (f) above. Taxes withheld
amount to ₱12,000
h. Received delivery of purchased office supplies worth ₱100,000. The office supplies
were purchased through check. Taxes withheld amount to ₱5,000.
i. Issued office supplies worth ₱90,000 to end users.
J. Granted ₱20,000 cash advance to an employee for travelling expenses on an official
local travel. The employee liquidated ₱17,000 and remitted the excess cash advance.
k. Collected unbilled service income for Permit Fees of ₱40,000 and remitted ₱30,000 of
the total collection.
l. Paid water and electricity expenses amounting to ₱5,000 and ₱10,000 respectively.
Taxes withheld amount to ₱2,000.
m. Remitted the taxes withheld to the BIR
n. Remitted contribution to GSIS, PhilHealth and Pag-ibig.
Requirements:
1. Record the transactions and events above. If no journal entry is needed, state the
registry or other document where the transaction or event is recorded.
2. Post the transactions in the ledger. Use T-accounts
3. Prepare the unadjusted trial balance
4. Prepare the adjustments if any.
5. Prepare a complete worksheet showing columns for post-closing trial balance
6. Prepare the closing entries