Professional Documents
Culture Documents
1. This account is used to record in the BTR books NG’s quota/authorized subscription to capital stocks,
replenishments, pledges, maintenance of values/revaluation of quota/subscription to capital stocks of
Foreign Financial Institutions (FFIs) of which the NG is a member. Investments are payables in foreign
currencies, Philippine peso or promissory notes.
Answer: INVESTMENT IN STOCKS
2. This account is used to record the amount granted to duly designated Petty Cash Custodian for
payment of authorized petty or miscellaneous expenses which cannot be conveniently paid through
checks.
Answer: PETTY CASH
3. This account is used to record the amount due from customers arising from regular trade and
business transactions.
Answer: ACCOUNTS RECEIVABLE
4. This account is used to record financial assets that, upon initial recognition, are designated by the
entity as at fair value through profit or loss. This shall comprise of both debt and equity securities and
shall be accounted for in the same manner as help for trading securities.
Answer: FINANCIAL ASSETS DESIGNATED AT FAIR VALUE THROUGH SURPLUS AND
DEFICIT
5. This account is used to record debt and equity securities that are: (a) acquired principally for the
purpose of selling or repurchasing them in the near term; or (b) part of a portfolio of identified
securities that are managed together and for which there is evidence of a recent actual pattern of
short-term profit-taking.
Answer: FINANCIAL ASSETS HELD FOR TRADING
6. This account is used to record amounts of credit extended to local government units covered by loan
agreements.
Answer: LOANS RECEIVABLE- LGU
7. This account is used by the BTr to record dividends due on NG equity in GFIs/ GOCCs.
Answer: DIVIDENDS RECEIVABLE
8. This account is used to record foreign currency deposits of agencies implementing foreign-assisted
projects and those authorized by a regulation or by the lending/donor institution to maintain Special
Account/Imprest Account/Working Fund.
Answer: CASH IN BANK-FOREIGN CURRENCY, CURRENT ACCOUNT
9. This account is used to record money invested in entities that are neither a subsidiary nor joint
venture, where the national government agency has significant influence.
Answer: INVESTMENT IN ASSOCIATES
10. This account is used to record money invested in entities that are neither a subsidiary nor
affiliate/associate, where the agency has joint control.
Answer: INVESTMENT IN JOINT VENTURE
Problems:
1. On 2 January 2015, Agency A acquired a zero-coupon bond in the market for P98, 000 plus
transaction fees of P2, 000 in an arm’s length transaction. The bond will be redeemed at P126,000 on
December 31, 2019. The effective interest rate for this transaction is 4.73%.
a. How much Investment in Bonds is to be recognized by Agency A on 2 January 2015?
Initial cost 98,000
Transaction 2,000
fees
Total 100,000
investment
3. On 5 January 2015, Agency A acquired an investment designated at fair value through surplus or
deficit for P1,000,000. In addition Agency A paid P50, 000 to cover the transaction costs pertaining to
agent’s commissions, taxes and other fees.
a. How much Financial Asset Designated at Fair Value through Surplus or Deficit is to be
recognized by Agency A on 5 January 2015?
Purchase price 1,000,000
Transaction costs 50,000
Total costs 1,050,000
4. On December 31, 2015 Agency A reported that the fair value of the Financial Assets Held for Trading
with a carrying amount of 500,000 increases to 600,000. During that day, the fair value of the
Financial Assets classified as available for sale is likewise determined to be 850,000 from its previous
carrying amount of 800,000.
a. Prepare journal entries to record the transactions
Journal entries:
Financial assets held for trading 100,000
Unrealized gain on financial assets held for trading 100,000
2) _______________ used to acknowledge the receipt of supplies purchased and inspection made.
Answer: IAR ( INSPECTION AND ACCEPTANCE REPORT)
5) _________________used to report all materials that are destroyed such as spare parts and other
materials considered scrap due to replacement.
Answer: WMR ( WASTE MATERIALS REPORT)
6) Report of Supplies and Materials Issued – shall be prepared by the ____________based on the RIS
and shall be used by the Accounting Unit as basis in preparing the JEV to record the supplies and
materials issued.
Answer: SUPPLIES OFFICERS OR PROPERTY & SUPPLY CUSTODIAN
9) __________________Used to request for the purchase of inventory/item supplies and materials not
available on stock.
Answer: PR ( PURCHASE REQUEST
QUIZ 8:
The active market provided the fair value less cost to sell of the cows as follows:
January 1, 2023
1. Purchased from Batangas Farmville, eight (8) 3-year-old mature dairy cows for breeding with
property no. 451240 with Fair Value of P18,000.00 and costs to sell of P3,000.00 each.
Breeding stocks 120,000
Loss on initial recognition of biological assets 24,000
Cash,MDs, regular 144,000
July 1, 2023
4. The cows gave birth to five (5) calves
Breeding stocks 20,000
Gain on initial recognition of biological assets 20,000
As a General Accountant of DAR, prepare necessary accounting entries related to biological assets.
• Gain 3 years old
Breeding stocks 72,000
Gain from changes in FVCTS of BA due to price change 24,000
Gain from changes in FVCTS of BA due to physical change 48,000
2. The Bureau of Fisheries and Aquatic Resources (BFAR) acquires through cash purchase a building
which meets the criteria for an IP. Which of the expenditures below should be included in the cost of
this IP?
a. Monthly payroll for the entire property department
b. Property transfer taxes
c. Fees for external legal advice on the preparation of the purchase contract
d. B and C only
3. On June 17, 2023, BFAR received an unconditional donation of a piece of land costing P1,500,000
from the DENR. The fair value of the land at that date is P1,800,000. On December 31, 2023 it has a
fair value of P2,000,000. The land acquired is held by the agency for long – term capital appreciation.
At what amount will the land be recorded in the books of the agency?
a. Dr, Investment Property, Land 1,500,000. Cr, Income from Grants and Donation in Kind
1,500,000
b. Dr, Investment Property, Land 1,800,000. Cr, Income from Grants and Donation in
Kind 1,800,000
c. Dr, Investment Property, Land 2,000,000. Cr, Income from Grants and Donation in Kind
2,000,000
d. None of the above
4. On January 1, 2023 BFAR acquired a building for P950,000. Refundable purchase tax of P50,000 and
legal fees of P20,000 were incurred in acquiring the building and paid on January 1, 2023.The building
is held to earn lease rentals and for long-term capital appreciation. BFAR shall record the building at
what amount?
a. P1,000,000
b. P970,000
c. P950,000
d. P1,020,000
5. On December 31, 2023 investment property costing P5,000,000, with Accumulated Depreciation of
P1,900,000 and Accumulated Impairment Loss of P100,000 was sold for net proceeds of P2,800,000.
What is the gain/loss to be recorded by the entity?
a. Loss – P300,000
b. Gain – P200,000
c. Loss – P200,000
d. Gain – P300,000
QUIZ 10: