PHINMA ARAULLO UNIVERSITY
COLLEGE OF MANAGEMENT & ACCOUNTANCY
ACC 032 INFORMATION & COMMUNICATION TECHNOLOGY 1
Quiz no. 1-2nd Period
Name:__________________________________

Date:_________________

Section:_____________________

Score: ____________

Case 1
A merchandising company needs to use contra-accounts in recording certain company transactions. REQUIRED:
(1) Identify contra-accounts that have normal debit balances commonly used by a merchandising business and explain briefly why they are not considered expenses/assets.
(2) Identify contra-accounts that have normal credit balances commonly used by a merchandising business and explain briefly why they are not considered income/liabilities.
Case 2
You are given the following account balances for the company as of fiscal year-end, July 31, 2015:
 Sales (75% on terms 2/10, n/30) – P1,200,000
 Sales return and allowances (70% made by credit customers) – P50,000
 Sales discount – P10,900
 Accounts receivable, August 1, 2007 – P168,000
 Accounts receivable, July 31,2008 – P183,000
 Allowance for Doubtful Accounts, August 1, 2007 – P7,500
REQUIRED: Prepare the necessary adjusting journal entry in the company’s books on July 31, 2015 to provide the uncollectible accounts, under the following independent assumptions.
(1) It is estimated that 1% of net credit sales is doubtful of collections.
(2) It is estimated that 10% of outstanding accounts receivable is doubtful of collection.
(3) The company wants to maintain the same amount of net realizable value as last year’s.

Case 3
Below are the company’s cash ledger and bank statement for the month of April 2015.

Date
March 31
Apr 02
11
18
24
27
30

Apr 30

Items
Balance
Deposit
Deposit
Deposit
Deposit
Deposit
Deposit

F

CASH IN BANK – MASTER BANK
Dr
Date
Items
61,000
Apr 04 Check#14544 – CEBU
12,500
06 Check#14545 – DAVAO
15,000
09 Check#14546 - QUIZON
8,200
12 Check#14547 – PALAWAN
3,900
16 Check#14548 - MINDORO
17,700
19 Check#14549 – ANTIPOLO
22,400
21 Check#14550 – AKLAN
24 Check#14551 – LAGUNA
30 Check#14552 - SIARGAO
45,000

NOTE: This test is only for students who enrolled ACC 033 ICT 2.(Special Class)

F

1005
Cr
13,000
6,700
11,300
9,900
6,000
12,400
10,800
18,500
7,100

MASTER BANK
Bank Statement
Account Name: Lupang Hinirang Trading
Account number: 1203-774562-2
Date
Apr 01
02
03
03
05
10
11
14
15
17
18
20
24
24
28
30
30

Page 1 Of 1
Period covered: April 1-30, 2015

Description
Balance forwarded
Deposit*
Deposit
Check#14541**
Check#14544
Check#14546
Deposit
Check#14547
Check#14545
Debit memo – cost of checkbook
Deposit
Check#14549
Deposit
Check#14550
Deposit
Credit memo – collection of customer’s note (Principal: P10,000; Interest: 200)
Debit memo – NSF check

Debit

Credit
20,000
12,500

5,000
13,000
11,300
15,000
9,900
6,700
220
8,200
12,400
3,900
10,800
17,700
10,200
8,000

Balances
46,000
66,000
78,500
73,500
60,500
49,200
64,200
54,300
47,600
47,380
55,580
43,180
47,080
36,280
53,980
64,180
56,180

*This refers to the deposit made last March 31, 2015.
**This refers to the check issued last March 25, 2015.
REQUIRED:
(1) Prepare the company’s bank reconciliation statement as of April 30, 2015 under the adjusted balance method.
(2) Prepare all the necessary adjusting entries in the company’s books on April 30, 2015.
Case 4
Details of the fixed assets of UNO COMPANY as of calendar year 2014 are given below:
Asset Type
Store equipment
Store Furniture and
Fixtures
Delivery Equipment

Cost

Date of Purchase

P 20,000
55,000

Estimated Scrap
Value
none
10% of cost

Apr 1, 2013
Jan 31, 2014

Estimated Useful
Life
8 years
10 years

380,000

P50,000

Dec 1, 2014

5 years

The company uses the straight-line method of depreciation.
REQUIRED:
(1) Prepare the adjusting journal entry for depreciation on December 31, 2014. Separate the depreciation according to assets type.
(2) Prepare the company’s supporting note for the property, plant, and equipment section of the balance sheet as of December 31, 2014. Present the supporting notes as follows:
Store
Equipment

Store Furniture
And Fixtures

Cost
Less: Accumulated Depreciation
CARRYING VALUE

NOTE: This test is only for students who enrolled ACC 033 ICT 2.(Special Class)

Delivery
Equipment

Case 5
On December 1, the Accounts Receivable control account balance in the general ledger of KIWI
TRADING was P19,000. The Accounts Receivable subsidiary ledger contained the following detailed customer balance: Apple – P2,100; Melon – P2,600; Orange – P2,800; and Peach – P1,500. The following information is available from the company’s special journals for the month of December:
Cash receipts journal: Cash received from Melon – P1,900; from Peach – P1,600; from Cherry – P1,700; and from Apple – P1,800.
Sales journal: Sales to Cherry – P4,300; to Melon – P1,700; to Peach – P2,300; and to Orange – P2,400.
Additionally, Melon returned defective merchandise for credit for P900. Peach returned defective merchandise for P600 she had purchased for cash.
REQUIRED:
Reconcile the Accounts Receivable control account with the subsidiary ledger by a schedule of Accounts
Receivable as of December 1, 2014.
Case 6
CHRIS AUTO SUPPLY uses a periodic inventory system, while MASS COMPANY uses a perpetual inventory system. Both companies are VAT-registered and all amounts are inclusive of 12% VAT.
During October 2014, the following transactions occurred.
Date
Transaction
May 13 Purchased 6 side-view mirrors at a cost of P440 each from MASS COMPANY on terms
1/10, n/30. The motors cost Mass Company P250 each.
16 Returned 1 defective side-view mirror to Mass Company.
23 Paid Mass Company in full.
REQUIRED:
(1) Prepare all the necessary journal entries in the books of Chris Auto Supply for the above transactions. (2) Prepare all the necessary journal entries in the books of Mass Company for the above transactions. Case 7
The company, which prices its goods at 25% above cost, employs a perpetual inventory system. Selected transactions for the month of July 2014 showed the following:
Date
July 05
05
15
16
26

Transaction
Sold merchandise on terms 2/10, n/30. The cost of sales is P45,000
Received return of merchandise from July 5 sale. The cost of sales returns is P1,800
The account (from the July 5 sale) was collected in full.
Purchased merchandise costing P35,000 on terms 2/10, n/30.
The account (for the July 16 purchase) was paid in full

REQUIRED:
(1) Prepare all the necessary journal entries, including VAT, for the above transactions. Assume all amounts are inclusive of 12% VAT.
(2) Compute the amount of VAT the company has to remit to the BIR on or before August 20.

NOTE: This test is only for students who enrolled ACC 033 ICT 2.(Special Class)

Case 8
Pastel Black has worked for Dr. Rain Bowie for several years. Pastel demonstrates a loyalty that is rare among employees. She hasn’t taken a vacation in the last three years. One of Pastel’s primary duties at the medical office is to open the mail and list the checks received. She also takes cash from patients at the cashier window as patient leave. At times, it is so hectic that Pastel doesn’t bother with giving each patient a receipt for the cash paid on their accounts. She assures them she will see to it that they receive the proper credit. When the traffic is low in the office, Pastel offers to help Eve post the payments to the patients’ Accounts Receivable. Eve is always happy to receive Pastel’s help, because she is a very conscientious worker.
REQUIRED:
Identify any principles of internal control that may be violated in this medical office situation, and indicate your proposed solutions/recommendations.

NOTE: This test is only for students who enrolled ACC 033 ICT 2.(Special Class)