Deloy, Jenivieve O.

BSA601
04 ACTIVITY 1

1) The entries to be made by Y Agency are as follows:

Financial ssets held for Trading 10201010 P 200,000

Cash in Bank-Local Currency, Banko Sentral ng Pilipinas 10102010 200,000
To recognize the acquired financial asset held for trading

Other Financial Charges 50301990 5,000

Cash in Bank-Local Currency, Banko Sentral ng Pilipinas 10102010 5,000
To recognize the transaction cost incurred

2) The entries to be made by Y Agency are as follows:

Investment in Treasury Bonds-Foreign

Cash in Bank-Local Currency, Banko Sentral ng Pilipinas 10202040 P 205,000
To recognize investment foreign treasury bonds 10102010 205,000

3) The accounting entries to recognize the machine shall be as follows:

At the date of acquisition

Agricultural and Forest Equipment 10605040 P 245,000
Accounts Payable 20101010 245,000
To recognize purchase of machinery on account

If the agency pays within the discount period

Accounts payable 20101010 245,000
Cash-Modified Disbursement System (MDS), Regular 10104040 240,100
Due to Bureu of Internal Revenue (BIR) 20201010 4,900
To recognize the payment of machinery within the discount period
If the agency pays beyond the discount period
Accounts payable 20101010 245,000
Other Losses 50504990 5,000
Cash-Modified Disbursement System (MDS), Regular 10104040 245,100
Due to Bureu of Internal Revenue (BIR) 20201010 4,900
To recognize the payment of machinery beyond the discount period