ILLUSTRATIVE PROBLEM 1

 Basic entries in Regular Agency Books

 Closing journal enties
 Income Statement

TRANSACTIONS:

1. The approriation for the year was P14,500.

2. Receipt of allotment for:
a. Personal Services (PS) 2,050
b. Maintenance and Other Operating Expense (MOOE) 2,000
c. Capital Outlay (CO) 8,550
d. Financial Expenses (FE) 400
3. Receipt of Notice of Cash Allocation (NCA) from DBM 10,500

PERSONAL SERVICES

4. Obligation for Personal Services, 2,050

5. Established payroll fund which is composed of :
a. Regular pay 2,400
b. Personal Economic Relief Allowance (PERA) 600
Total 3,000
LESS: Deductions:
Witholding Tax 400
GSIS Life and Retirement Premium 300
Philhealth Premiums 150
Pag-ibig Premiums 100
Note: Accordingly, an amount of P2,050 was advanced by the agency’s disbursing officer.
6. To record liquidation of cash advances/payment of salaries.
7. Remittance of GSIS, Philhealth, PAG-IBIG premiums.
8. Remittance of withholding tax to BIR.
9. Obligation for government share representing:
a. Life and retirement insurance (GSIS) 300
b. Philhealth 150
c. Pag-ibig 100
10. Recording the incurrence of government share for applicable salary deduction
11. Remittance of government share for applicable salary deduction.

MAINTENANCE AND OTHER OPERATING EXPENSES (MOOE)

12. Obligation of rent for two years, P150.

13. Payment of two year’s rent,
14. Obligation for electricity, P300; telepehone, P50.
15. Received the following bill:electricty, P300; telephone, P50
16. Payment of electricty and telephone bills net of withholding tax of P24 and P4.
17. Issuance of purchase order (obligation) for office supplies, P200.
18. Receipt of the office supplies.
19. Paid the office suppplies ( net of withholding tax of P20)
20. Remittance of withholding tax to BIR.

CAPITAL OUTLAY

21. Issuance of purchase order (obligation) for equipment, P100

22. Receipt of office equipment.
23. Payment of office equipment (net of withholding tax of P10)
24. To records obligation for construction of a new building upon signing of contract, P700.
25. Payment of 15% of contract for mobilization (P700 x 15%), P105.
26. Receipt of the first billing for construction of the new building:
50% of P700 P350
 Less:Recoupment 105
Net amount 245
27. Payment of the first progress billing, withholding tax of P25.
28. Presentation of of final billing: 50% of P700.
29. Final payment for building, withholding tax of P35
30. Received the completed building from the contractor.
31. Remit all the witholding taxes to BIR.
32. Agency is to transfer cash of P400 to Agency XYZ for a land beautification project.
33. Cash is transferred to Agency XYZ.
34. Received report from Agency XYZ

FINANCIAL EXPENSES

35. Obligation for finacial expenses, P300

36. Paid interest expense of P300.

OTHER REVENUE (EXCLUDING SING)

37. Collection of the following items in which the agency is AUTHORIZE to use in ther operation:
Sales Revenue P3
Miscellaneous Income 1

38. Collection of the following items in which the agency is NOT AUTHORIZE to use in ther operation:
Licensing Fees P1
Permit Fees 1
Adjusting journal entries:

a. Depreciation for equipment, P5; building, P15.

b. Office supplies used, P140.
c. Rent expense for the year, P75.
REGULAR AGENCY BOOKS (RA)

Debit Credit
1 No journal entry/No memo
entry
2 Memo entries in RAOCO,
RAOMO, RAOPS, and RAOFE
3 Cash- National Treasury
Modified Disbursement
System (NTMDS)
Subsidy Income from
National Government
(SING)
4 Memorandum entry in
RAOPS

5 Cash-Disbursing Officers
Cash-NTMDS

6 Salaries and Wages- Regular

payroll
PERA
Due to BIR
Due to GSIS
Due to Philhealth
Due to Pagibig
Cash-Disbursing Officers

7 Due to GSIS
Due to Philhealth
Due to Pag-ibig
Cash-NTMDS

8A Due to BIR
Cash-NTMDS

8B Due to BIR
SING

9 Memorandum Entry RAOPS

10 Life and Retirement
Insurance Contribution
Philhealth Contribution
Expense
Pag-ibig Contribution
Expense
Due to GSIS
Due to Pag-ibig
Due to Philhealth

11 Due to GSIS
 Due to Pag-ibig
Due to Philhealth
Cash-NTMDS

12 Memo entry in RAOMO

13 Prepaid rent
Cash-NTMDS

14 Memo entry in RAOMO

15 Electricity Expense
Telephone Expense
Accounts Payable

16 Accounts Payable
Cash-NTMDS
Due to BIR

17 Memo entry in RAOMO

18 Office Supplies
Accounts Payable

19 Accounts Payable
Cash-NTMDS
Due to BIR

20A Due to BIR

Cash-NTMDS

20B Due to BIR

SING

21 Memo entry in RAOCO

22. Office Equipmet

Accounts Payable

23 Accounts Payable
Cash-NTMDS
Due to BIR

24 Memo entry in RAOCO

25 Advances to Contractor
Cash-NTMDS
26 CIP-Building
Advances to Contractors
Accounts Payable

27 Accounts Payable
Due to BIR
Cash-NTMDS

28 CIP-Building
Accounts Payable

29 Accounts Payable
Due to BIR
Cash-NTMDS

30 Buildings
CIP-Building

31A Due to BIR

Cash-NTMDS

31B Due to BIR

SING

32 MEMO ENTRY IN RAOCO

33 Due from NGA- Agency XYZ
Cash-NTMDS

34 Land Development
Due from NGA- Agency XYZ

35 MEMO ENTRY IN RAOFE

36 Interest Expense
Cash-NTMDS

37 Cash-Collecting Officer
Sales Revenue
Miscellaneous Income

38 No Journal entries in
RA/Journal entry in NG
REGISTRY OF ALLOTMENTS AND OBLIGATIONS-PERSONAL SERVICES (RAOPS)

Date Allotment received Obligations incurred Balance

REGISTRY OF ALLOTMENTS AND OBLIGATIONS-MAINTENANCE AND OTHER OPEARATING (RAOMO)

Date Allotment received Obligations incurred Balance

REGISTRY OF ALLOTMENTS AND OBLIGATIONS-FINANCIAL EXPENSES (RAOFE)

Date Allotment received Obligations incurred Balance

REGISTRY OF ALLOTMENTS AND OBLIGATIONS-CAPITAL OUTLAY (RAOCO)

Date Allotment received Obligations incurred Balance