ARTS CPA Review

2F & 3F Crème Building, Abella St., Naga City

Tel No. (054) 472-9104; E-mail: artscparev@yahoo.com

PRACTICAL ACCOUNTING PROBLEMS II ADAPTED

NEW GOVERNMENT ACCOUNTING SYSTEM (NGAS)

Illustrative Problems:

Department SS is a national government agency. Some of the major transactions of the agency for the year 2011
were as follows:

1. The approved appropriation for the year was P3,000,000. Ninety percent (90%) of this appropriation was
allotted by the DBM to Department SS. The allotment is broken down as follows:

Capital Outlay (CO) P335,000

MOOE 102,000
Personal Services 60,000
Financial Expenses 40,000

2. Received NCA, P2,000,000 (net of withholding tax).

3. Obligations were incurred as follows:

Personal services P50,000

Obligation for MOOE 70,000
Capital Outlay 180,000
Financial Expenses 30,000

4. Received the office equipment purchased with the charge invoice, P50,000.

5. Grant of cash advance for payroll, P40,000.

6. Payment of Salaries and Wages and Other Allowances:

Salaries, P44,000
Additional compensation, P3,000
PERA, P3,000
Withholding Tax Payable, P3,500
GSIS Payable, P5,500
Pag-ibig Payable, P400
PhilHealth Payable, P600

7. Remittance of salary deductions.

8. Payment of government share for the following:

Life and Retirement Contributions, P5,500

PAG-IBIG Contributions, P400
PHILHEALTH Contributions, P600

9. Payment of the following obligations:

Meralco bill, P5,000

PLDT bill, P4,000
Payment of accounts payable for office equipment (net of withholding tax of P5,000), P45,000

10. Issuance of Tax Remittance Advice (TRA) for tax withheld, P4,500

11. Collection of Income/ Other Receipts which the agency is authorized to use in their operations are as
follows:

Sales Revenue, P40,000

Permit Fees, P30,000
Miscellaneous Income, P20,000

12. Deposited the above collections thru the Agency Depository Bank.

Page 1 of 2 P2 17-35
 Solutions:
1. Memo entry in the RAOPS, RAOMO, RAOCO and RAOFE.
2. Cash – National Treasury – MDS 2,000,000
Subsidy Income from National Government 2,000,000

3. Memo entry in the RAOPS, RAOMO, RAOCO and RAOFE.

4. Office equipment 50,000

Accounts payable 50,000

5. Cash – Disbursing Officer 40,000

Cash – National Treasury – MDS 40,000

6. Salaries and wages – Regular 44,000

Personal economic relief allowance (PERA) 3,000
Additional compensation 3,000
Due to BIR 3,500
Due to GSIS 5,500
Due to Pag-ibig 400
Due to Philhealth 600
Cash – Disbursing Officer 40,000

7. Due to GSIS 5,500

Due to Pag-ibig 400
Due to Philhealth 600
Cash – National Treasury – MDS 6,500

8. Life and retirement contribution 5,500

Pag-ibig contribution 400
Philhealth contribution 600
Cash – National Treasury – MDS 6,500

9. Electricity 5,000
Telephone expense – Landline 4,000
Accounts payable 50,000
Due to BIR 5,000
Cash – National Treasury – MDS 54,000

10. Due to BIR 4,500

Subsidy income from national government 4,500

11. Cash – Collecting Officer 90,000

Sales revenue 40,000
Permit fees 30,000
Miscellaneous income 20,000

12. Cash in Bank – Local currency – Current account 90,000

Cash – Collecting Officer 90,000

Page 2 of 2 P2 17-35