PROBLEM 1
In connection with your annual audit of Samsy Company’s financial statements for the
year ended December 31, 2023, you have extracted the following information from your
client’s accounting records.
Cash on hand P1,200,000
Petty cash fund 10,000
Balanghay Bank current account 980,000
Solid Bank current account No. 1 460,000
Solid Bank current account No. 2 (100,000)
Lagaslas Bank savings account 1,500,000
Time deposit (90 days) – BDO 2,000,000
Note 1 – cash on hand included the following:
a. PHLPOST money orders from various customers, P300,000.
b. A customer check for P50,000 was returned by the bank on December 29,2023 due
to insufficient fund but was subsequently redeposited and cleared by the bank on
January 6, 2024.
c. The cash receipts journal was held open until January 10, 2024 during which time
P300,000 was collected and recorded on December 31, 2023.
d. A customer check for P30,000 dated January 30, 2024, received on December 27,
2023.
Note 2 – the petty cash fund consisted of the following items on December 31, 2023.
a. Bills and coins P3,000
b. Unreplenished petty cash disbursements P1,000
c. Employees’ IOUs 500
d. Currency in an envelope marked “employees’ contributions for charity” 1,500
e. Check drawn by Samsy Company, payable to the petty cash custodian 4,000
Note 3 – included among the checks drawn by Samsy company against the balanghay
Bank current account are the following:
a. A check written and dated December 23,2023 and delivered to payee on January
29, 2024, P30,000.
b. A check written on December 28, 2023, dated January 3, 2024, delivered to payee
on December 29, 2023, P75,000.
Note 4 – Samsy’s savings account deposit in Lagaslas Bank has been earmarked for the
acquisition of a state-of-the-art manufacturing equipment within the next couple of
months.
Based on the preceding information, compute for the adjusted balances of the following:
1. Cash on hand
2. Petty cash fund
3. Balanghay Bank current account
4. Cash and cash equivalents
PROBLEM 2
In connection with your audit of the financial statements of Ponny Company for the year
ended December 31, 2023, you gathered the following information.
1. The company maintains its current account with TLC Bank. The bank statement on
December 31, 2023, showed a balance of P638,340.
Your audit of the company’s account with TLC Bank disclosed the following:
A check for P22,500 received from a customer whose account is current has
been deposited and then returned by the bank on December 28, 2023. No entry
was made for the return of this check. The customer replaced the checks on
January 15, 2024.
A check for P5,720 was cleared by the bank as P7,520. The bank made the
correction on January 2, 2024.
A check for P3,500 representing payment of an employee advance was received
and deposited on December 27, 2023, but was not recorded until January 3,
2024.
Postdated checks totaling P67,300 was included in the deposits in transit. These
represent collections of current accounts receivable from customers. The checks
were actually deposited on January 5, 2024.
Various debit memos for drafts purchased for payment of importation of
equipment totaling P230,000 were not yet recorded. These purchases were
previously set up as accounts payable. Said equipment arrived in December
2023.
Interest earned on the bank balance for the 4 th quarter of 2023, amounting to
P1,950 was not recorded.
Bank service charges totaling P1,260 were not recorded.
Deposit in transit and outstanding checks at December 31, 2023, totaled
P136,250 and P276,380, respectively.
2. Various expenses from the company’s imprest petty cash fund dated December
2023, totaled P16,250, while those dated January 2024, amounted to P5,903.
Another disbursement from the fund dated December 2023 was a cash advance to
an employee amounting to P3,500. A replenishment of the petty cash fund was
made on January 8, 2024.
3. The company’s trial balance on December 31, 2023, includes the following
accounts:
Cash in bank – TLC Bank P748,320
Cash in bank – ER Bank (restricted account for
plant expansion, expected to be disbursed in 2024) 700,000
Petty cash fund 30,000
Time deposit, placed December 20, 2023,
And due March 20, 2024 1,000,000
Money market placement – Prudential Bank 4,000,000
1. What is the adjusted petty cash fund balance on December 31, 2023?
2. What is the adjusted cash in bank -TLC Bank balance on December 31, 2023?
3. The December 31, 2023, statement of financial position should show “cash and
cash equivalents” at?
PROBLEM 3
The following information pertains to FLINT CORP:
Flint Corp.
BANK RECONCILIATION
November 30, 2023
Balance per bank statement P435,000
Less: outstanding checks
No. 4321 P6,000
No. 4329 15,000
No. 4340 1,700
No. 4341 4,675 27,375
P407,625
Add: Deposit in transit 16, 200
Balance per books P423,825
CHECK REGISTER
December 2023
Vouchers
Date Payee No. Payable Discount Cash
Dec. 1 Dan Beda, Inc. 4342 P10,000 P500
P9,500
3 Miriam Corp. 4343 4,200 - 4,200
7 UE Enterprise 4344 3,755 - 3,755
12 PSBA Corp. 4345 12,000 120
11,880
15 Payroll 4346 96,000 -
96,000
16 BU, Inc. 4347 6,300 - 6,300
18 New Era Co. 4348 14,200 142
14,058
21 UST, Inc 4349 7,000 - 7,000
22 Petty cash fund 4350 10,000 -
10,000
28 Payroll 4351 98,000
98,000
BANK STATEMENT
BANKABLE BANK
PERIOD: NOVEMBER 30, 2023- DECEMBER 31, 2023
No.:001-43-44
Date Description Check Number Debit Credit
balance
Balance last statement P435,000
Dec. 1 Cash deposit 16,200
451,200
1 check issued 4329 P15,000 436,200
4 check issued 4342 9,500 426,700
4 check issued 4341 4,675 422,025
5 check deposit 49,000
471,025
6 check issued 4343 4,200 466,825
8 check deposit 14,000
480,825
10 check issued 4344 3,755 477,070
15 Encashment 4346 96,000
381,070
22 Encashment 4350 10,000
371,070
28 Encashment 4351 98,000
273,070
29 Debit memo-SC 1,000 272,070
29 Credit memo-interest 1,550 273,620
Deposits in transit at December 31 totaled P49,000.
1. What is the total book receipts for December?
2. What is the cash balance per books on December 31, 2023?
3. What is the total outstanding checks on December 31, 2023?
4. What is the adjusted cash balance on December 31, 2023?
