• No results found

AUD REV, Cash & Cash Equiv

N/A
N/A
Protected

Academic year: 2021

Share "AUD REV, Cash & Cash Equiv"

Copied!
11
0
0

Loading.... (view fulltext now)

Full text

(1)

AUDIT OF CASH AND CASH EQUIVALENTS AUDIT OF CASH AND CASH EQUIVALENTS Problem 1

Problem 1

The

The following following pertains to pertains to Pau Pau Company Company on on December 31, December 31, 2016:2016: Postage

Postage stamps stamps Php Php 5,0005,000 Credit memo from a vendor for a purchase

Credit memo from a vendor for a purchase

Return 100,000

Return 100,000

Current

Current account account Kapamilya Kapamilya bank bank ( ( 500,000)500,000) Current

Current account account at at Kapuso Kapuso bank bank 10,000,00010,000,000 Employees

Employees postdated postdated check check 20,00020,000 Foreign

Foreign bank bank account-restrictaccount-restricted ed (in (in equivalent equivalent peso) peso) 5,000,0005,000,000 IOU from Finance Manager’s brother in law

IOU from Finance Manager’s brother in law    50,00050,000 Trading

Trading securities securities 75,00075,000 Payroll

Payroll account account 2,500,0002,500,000 Petty cash fund (Php20,000 in currency and

Petty cash fund (Php20,000 in currency and expenses

expenses receipts receipts for for Php30,000) Php30,000) 50,00050,000 Postal

Postal money money order order 150,000150,000 Traveler’s check

Traveler’s check   250,000250,000 Treasury

Treasury bills, bills, due due 1/31/17 1/31/17 (purchased (purchased 1/31/16) 1/31/16) 1,500,0001,500,000 Treasury

Treasury bills, bills, due due 3/31/17 3/31/17 (purchased (purchased 12/31/16) 12/31/16) 1,000,0001,000,000 Treasury

Treasury warrants warrants 1,500,0001,500,000  Additiona

 Additional informatil information:on: a.

a. Check of Check of Php1,000,000 in Php1,000,000 in payment of payment of accounts accounts payable wpayable was as recorded onrecorded on December 31, 2016 but mailed to suppliers on January 5, 2017.

December 31, 2016 but mailed to suppliers on January 5, 2017. b.

b. Check of Php500,000 Check of Php500,000 dated January 15, dated January 15, 2017 in pay2017 in payment of accountsment of accounts payable was recorded and mailed on December 31, 2016.

payable was recorded and mailed on December 31, 2016. c.

c. Check of Check of Php250,000 dated January Php250,000 dated January 15, 2016 15, 2016 in payment in payment of accountsof accounts payable was recorded and mailed on January 15, 2016. As of the reporting payable was recorded and mailed on January 15, 2016. As of the reporting period, the same has not been encashed by the payee and still outstanding. period, the same has not been encashed by the payee and still outstanding. 1.

1. How How much much cash cash and and cash cash equivalents equivalents should should Pau Pau Company Company report report on on thethe December 31, 2016 statement of financial position?

December 31, 2016 statement of financial position? a. a. Php15,650,000 Php15,650,000 c. c. Php17,170,000Php17,170,000 b. b. Php17,000,000 Php17,000,000 d. d. Php18,650,000Php18,650,000 Problem 2 Problem 2

Total cash and cash equivalent of Php63,250,000 reported by Mari Company on Total cash and cash equivalent of Php63,250,000 reported by Mari Company on December 31, 2017 include the following information:

December 31, 2017 include the following information: a.

a. Two certificates of Two certificates of deposits, each totaling deposits, each totaling Php5,000,000, having Php5,000,000, having a maturity ofa maturity of 120 days.

120 days. b.

b. A check is A check is dated January dated January 12, 2018 in 12, 2018 in the amount of the amount of Php1,250,000.Php1,250,000. c.

c. A A commercial commercial paper paper of of Php21,000,000 which Php21,000,000 which due due in in 90 90 days.days. d.

d. Currency and Currency and coins on coins on hand amounted hand amounted to Php770,000.to Php770,000.

Mari Company has agreed to maintain a cash balance of Php5,000,000 in one of its Mari Company has agreed to maintain a cash balance of Php5,000,000 in one of its banks at all times to ensure future credit availability (this amount is legally restricted as banks at all times to ensure future credit availability (this amount is legally restricted as to withdrawal and was included in the above balance)

to withdrawal and was included in the above balance) 2.

2. How How much much is is the the correct correct amount amount of of cash cash and and cash cash equivalents equivalents that that MariMari Company should report

Company should report in its December in its December 31, 2017 statement o31, 2017 statement of financialf financial position? position? a. a. Php57,000,000 Php57,000,000 c. c. Php47,000,000Php47,000,000 b. b. Php31,000,000 Php31,000,000 d. d. Php62,000,000Php62,000,000

(2)

Problem 3

The cash account of Pau Company on December 31, 2016 has a balance of Php4,620,000 and it consists of the following:

Balance in savings account with a bank closed by the BSP Php 720,000

Bills and coins on hand 1,055,600

Checking account balance in Kapuso bank 440,000 Credit memo from supplier’s for purchase returns   130,000 Customer’s check dated January 15, 2016   160,000 Customer’s check dated January 16, 2017   600,000 Customer’s check returned on 12/31/16 for lack of 

sufficient fund 1,000,000

IOU of an employee 8,000

Money order 16,000

Petty cash including paid cash vouchers of Php16,500 40,000

Postage stamps 2,400

Traveler’s checks  448,000

---Total Php 4,620,000

============ 3. The correct cash and cash equivalents balance on December 31, 2016 is

 _________.

a. Php1,959,600 c. Php1,966,400 b. Php1,966,600 d. Php1,983,100.

Problem 4

In connection with your audit of Camil Company for the year ended December 31, 2016, you gathered the following:

Savings account at Kapatid Bank Php 4,000,000 Current account at Kapuso Bank ( 200,000) Demand deposit, Kapamilya bank 2,000,000 Cash collection not yet deposited 700,000

Payroll account 1,000,000

Travel advances of Php720,000 for executive travel for the first quarter of the next year

(employee to reimburse through salary deduction) 720,000  A separate cash fund in the amount of P6,000,000 is

restricted for the retirement of a long term debt 6,000,000 Camil Company has received a check dated

January 2, 2017 300,000

Camil Company has agreed to maintain a cash balance at all times at Kapuso bank to ensure future

credit availability 400,000

 A customer’s check returned by the bank for 

insufficient fund 300,000

 A check drawn by the Vice-President of the

Corporation dated January 15, 2017 140,000  A check dated May 31, 2016 drawn by the Corporation

against the kapuso Bank in payment of custom duties. Since the importation did not materialize , the check was returned by the customs broker. This

was an outstanding check in the reconciliation of

the Kapuso Bank account 820,000

Foreign bank account- restricted (in equivalent pesos) 2,000,000 Credit memo from a vendor for a purchase return 40,000

Traveler’s check  100,000

(3)

Petty cash fund (Php8,000 in currency and

expense receipts for Php11,900) 20,000 Treasury bills, due 2/28/17 (purchased 12/15/2016) 400,000  Additional information related to Demand deposit at Kapamilya Bank:

a. Check of Php200,000 in payment of accounts payable was recorded on December 31, 2016 but mailed to suppliers on January 5, 2017.

b. Check of Php100,000 dated January 5, 2017 in payment of accounts payable was recorded and mailed on December 31, 2016.

c. The company uses the calendar year. The cash receipts journal was held open until January 15, 2017, during which time Php400,000 was collected and recorded on December 31, 2016.

Based on the above information and the result of your audit. Compute for the cash and cash equivalents that will be reported on the December 31, 2016 statement of financial position, ______________.

Problem 5

The cash account in the ledger of Pau Company had a balance of Php1,689,600 at December 31, 2016. An examination of the account, however, disclosed the following: a. The sales book was left open up to January 5, 2017, and cash sales totaling

Php240,000 were considered as sales in December.

b. Checks of Php148,800 in payment of liabilities were prepared before December 31, 2016, recorded in the books , but not mailed or delivered to payees.

c. Post-dated checks totaling Php124,800 are being held by the cashier as part of cash. The company’s experience shows that post -dated checks are eventually realized.

d. Customer’s check for Php24,000 deposited with but returned by bank, “NSF” on December 27, 2016.

e. The cash account includes Php640,000 earmarked for the purchase of personal computers which will be soon delivered.

The cash balance to be shown on the statement of financial position at December 31, 2016 should be ____________.

Problem 6

You were able to gather the following from the December 31, 2016 trial balance of Mari Corporation in connection with your audit of the company:

Cash on hand Php 1,000,000

Petty cash fund 20,000

Kapuso bank current account 2,000,000 Kapatid bank current account No. 1 2,160,000 Kapatid bank current account No. 2 ( 160,000) Kapamilya savings account 2,400,000 Kapamilya time deposit 1,000,000 Cash on hand includes the following items:

a. Customer’s check for Php80,000 returned by bank on December 26, 2016 due to insufficient fund but subsequently redeposited and cleared by the bank on

January 8, 2017.

b. Customer’s check for Php40,000 dated  January 2, 2017, received on December 29, 2016.

c. Postal money orders received from customers, Php60,000.

The petty cash fund considered of the following items as of December 31, 2016.

Currency and coins Php 4,000

(4)

Currency in an envelope marked “collections

for charity” with names attached 2,400 Unreplenished petty cash vouchers 2,600 Check drawn by Mari Corporation, payable

to the petty cashier 8,000

---20,200 ===========

Included among the checks drawn by Mari Corporation against the Kapuso bank current account and recorded in December 2016 are the following:

 Check written and dated December 29, 2016 and delivered to payee on

January 2, 2017, Php160,000.

 Check written on December 27, 2016, dated January 2, 2017, delivered to

payee on December 29, 2016, Php80,000.

The credit balance in the Kapatid bank current account no. 2 represents checks drawn in excess of the deposit balance. These checks were still outstanding at December 31, 2016.

The savings account deposit in Kapamilya Bank has been set aside by the board of directors for acquisition of new equipment. This account is expected to be disbursed in the next 3 months after the end of the reporting period.

Based on the above and the result of your audit, determine the adjusted balances of the following:

1. Cash on hand

a. Php820,000 c. Php940,000 b. Php1,060,000 d. Php880,000

e. answer not given 2. Petty cash fund

a. Php12,000 c. Php4,000 b. Php14,400 d. Php9,800

e. answer not given 3. Kapuso bank current account

a. Php2,000,000 c. Php2,160,000 b. Php2,240,000 d. Php2,080,000

e. answer not given 4. Cash and cash equivalents

a. Php5,834,400 c. Php6,104,000 b. Php6,149,800 d. Php6,132,000

e. answer not given

Problem 7

Shown below is the bank reconciliation for Mari Company for May 2016: Balance per bank, May 31, 2016 Php 300,000  Add: Deposits in transit 48,000

---Total Php 348,000

Less: Outstanding checks Php 56,000 Bank credit recorded

in error 20,000

--- 76,000 ---Cash balance per books, May 31, 2016 Php 272,000

(5)

The bank statement for June 2016 contains the following data:

Total deposits Php 220,000

Total charges, including an NSF check of Php16,000 and a service charge

of Php800 192,000

 All outstanding checks on May 31, 2016, including the bank credit, were cleared in the bank in June 30, 2016.

There were outstanding checks of Php60,000 and deposits in transit of Php76,000 on June 30, 2016.

Based on the above and the result of your audit, answer the following: 1. How much is the cash balance per bank on June 30, 2016?

a. Php308,000 c. Php328,000 b. Php300,000 d. Php344,800

e. answer not given 2. How much is the June receipts per books?

a. Php248,000 c. Php220,000 b. Php192,000 d. Php296,000

e. answer not given 3. How much is the June disbursements per books?

a. Php192,000 c. Php179,200 b. Php159,200 d. Php196,000

e. answer not given 4. How much is the cash balance per books on June 30, 2016?

a. Php300,000 c. Php360,800 b. Php340,800 d. Php324,000

e. answer not given 5. The adjusted cash in bank balance as of June 30, 2016 is

a. Php283,200 c. Php344,000 b. Php324,000 d. Php392,000

e. answer not given

Problem 8

In the audit of Pau Company’s cash account, you obtained the following information: The company’s bookkeeper prepared the following bank reconciliation as of August 31, 2016:

Bank balance, Aug 31, 2016 Php 181,600

Undeposited collections 10,000

Bank charges 200

Bank collection of customer’s note ( 16,000) Outstanding checks: Number Amount 2059 Php 6,000 2067 10,000 2915 4,000 --- ( 20,000) ---Book Balance-August 31, 2016 Php 155,800 ============

(6)

 Additional data are given as follows:

1. Company recordings for September:

Total collections from customers Php 330,000

Total checks drawn 196,000

2. Bank statement totals for september:

Charges 247,600

Credits 338,000

3. Check2059 dated August 25, 2016, was entered as Php6,000 in payment of a voucher for Php60,000. Upon examination of the checks returned by the bank, the actual amount of the check was Php60,000.

4. Check No. 3010 dated September 22, 2016 was issued to replace a mutilated check (No.2067), which was returned by the payee. Both

checks were recorded in the amount drawn, Php10,000 but no entry was made to cancel check No. 2067.

5. The September bank statement included a check drawn by Mike Company for Php3,000.

6. Undeposited collections on June 30, 2016  – Php16,000.

7. The service charge for September was Php300 which was charged by the bank to another client.

8. The bank collected a note receivable of Php14,000 on September 27, 2016, but the collection was not received on time to be recorded by Pau Company.

9. The outstanding checks on September 30, 2016 were: Check No. Amount Check No. Amount 2067 Php 10,000 3015 Php 4,600

3056 2,600 3043 8,200

Based on the above and the result of your audit, determine the following: 1. Unadjusted cash balance per books as of September 30, 2016

a. Php305,600 c. Php289,800

b. Php305,500 d. Php331,400

e. answer not given 2. Adjusted cash balance as of August 31, 2016

a. Php171,600 c. Php127,600

b. Php117,600 d. Php181,600

e. answer not given 3. Adjusted book receipts for September 2016

a. Php341,000 c. Php344,000

b. Php364,000 d. Php346,000

e. answer not given 4. Adjusted bank disbursement for September 2016

a. Php240,300 c. Php250,300

b. Php152,300 d. Php196,300

e. answer not given 5. Adjusted cash balance as of September 30, 2016

a. Php265,300 c. Php275,600

(7)

Problem 9

You obtained the following information on the current account of Pau Company during your examination of its financial statements for the year ended December 31, 2017. The bank statement on November 30, 2017 showed a balance of Php306,000. Among the bank credits in November was customer’s note for Php100,000 collected for the account of the company which the company recognized in December among its receipts. Included in the bank debits were cost of checkbooks amounting to Php1,200 and a Php40,000 check which was charged by the bank in error against Pau

Company account. Also in November you ascertained that there were deposits in transit amounting to Php80,000 and outstanding checks totaling Php170,000.

The bank statement for the month of December showed total credits of Php416,000 and total charges of Php204,000. The company’s books for  December showed total debits of Php735,600, total credits of Php407,200, and a balance of Php485,600. Bank debit memos for December were: No. 008 for service charges and No. 009 on a

customer’s returned checks marked “ no sufficient fund” for Php24,000.

On December 31, 2017, the company placed with the bank a customer’s promissory note with a face value of Php120,000 for collection. The company treated this note as part of its receipts although the bank was able to collect on the note only in February 2018.

 A check for Php3,960 was recorded in the company cash payments books in December as Php39,600.

Based on the application of the necessary audit procedures and appreciation of the above data, you are to provide the answer to the following:

1. How much is the undeposited collections as of December 31, 2017? a. Php339,600 c. Php219,600

b. Php179,600 d. Php139,600 e. answer not given

2. How much is the outstanding checks as of December 31, 2017? a. Php191,600 c. Php361,960

b. Php397,600 d. Php363,160 e. answer not given

3. How much is the adjusted cash balance as f November 30, 2017? a. Php216,000 c. Php176,000

b. Php256,000 d. Php157,200 e. answer not given 4. How much is the adjusted bank receipts for December?

a. Php635,600 c. Php475,600 b. Php515,600 d. Php435,600

e. answer not given 5. How much is the adjusted book disbursements for December?

a. Php395,600 c. Php225,960 b. Php431,600 d. Php397,160

e. answer not given

6. How much is the adjusted cash balance as of December 31, 2017? a. Php625,640 c. Php220,000

b. Php195,640 d. Php375,640 e. answer not give

(8)

Problem 10

The cashier misplaced all the bank statements for the past year. You reviewed the accounting records and discovered that the following journal entry was made to reconcile the June 30, 2016 bank records and accounting records:

 Accounts receivable 152,024 Miscellaneous expense 1,250

Notes receivable 20,000

Interest revenue 1,000

Cash 132,274

Pre adjustment cash balance in the accounting records was Php768,370, outstanding checks were Php20,750 and no other adjustments were required.

What is the bank statement balance at June 30, 2016?

a. Php615,346 c. Php656,846 b. Php636,096 d. Php768,370

Problem 5

 Assume the following data of Pau Company of its cash and short-term, highly liquid investments for December 31, 2017:

Cash on hand Php 800,000

Checking account No. 421, Kapuso bank 2,000,000 Checking account No. 724, Kapuso bank ( 300,000)

Date Maturity

Securities Acquired Date Amount

120-day certificate of deposit 12/10/17 1/31/18 Php 6,000,000 BSP-Treasury bills (No. 1) 11/30/17 4/30/18 50,000,000 BSP-Treasury bills (No. 2) 10/31/17 1/20/18 10,000,000 180 days commercial paper 12/1/17 6/20/18 14,000,000 Money market funds 11/21/17 2/10/18 20,000,000 5. The correct cash and cash equivalents balance on December 31, 2017 is

a. Php38,500,000 c. Php52,500,000 b. Php38,800,000 d. Php52,800,000 Problem 11

The December 31, 2016 trial balance of Mari Company includes the following accounts:

Petty cash fund Php 700,000

Current account-Kapuso bank 40,000,000 Current account-Kapamilya bank (overdraft) ( 2,500,000) 120-day money market placement-K bank 10,000,000

Time deposit-KB bank 20,000,000

 Additional information:

a. The petty cash fund includes unreplenished December 2016 petty cash expense vouchers for Php150,000 and an employee check for Php50,000 dated January 31, 2017.

b. A check for Php1,000,000 was drawn against Kapuso bank current account dated and recorded December 27, 2106 but delivered to payee on January 10, 2017.

c. The KB bank time deposit is set aside for land acquisition in early January 2017.

(9)

What should be reported as “cash and cash equivalents” on December 31, 2016? a. Php51,300,000 c. Php41,500,000

b. Php51,500,000 d. Php48,800,000

Problem 12

Camil Company’s ledger showed a balance in its cash account at December 31, 2016 of Php1,364,500, which was determined to consist of the following:

Petty cash fund Php 7,200

Checking account in Kapamilya bank ( check

of Php12,000 is still outstanding) 673,500 Notes receivable in the possession of a

collecting agency 50,000

Undeposited receipts, including a postdated check for Php10,500 and traveller’s check

for Php10,000 356,000

Bond sinking fund cash 255,000

IOUs signed by employees 9,900

Paid vouchers, not yet recorded 12,900

---Total Php 1,364,500

============

 At what amount should “cash on hand and in bank” be reported on Camil Company’s statement of financial position?

a. Php1,003,700 c. Php1,258,700

b. Php1,014,200 d. Php1,324,500

Problem 13

The petty cash fund of Pau Company at the end of the fiscal year ended June 30, 2016, is composed of the following:

Currencies Php 7,600 Coins 2,400 Paid vouchers: Office supplies 3,500 Postage stamps 4,000 Loans to employees 12,000

Check drawn by the manager, returned by bank

marked “NSF”.  5,500

Check drawn by the company, payable to the order of the petty cash custodian , representing

her salary 25,000

The amount of petty cash fund that would be shown on the statement of financial position at June 30, 2016 of Pau Company is __________.

a. Php10,000 c. Php40,500

b. Php35,000 d. Php60,000

Problem 14

Upon examination of the petty cash fund of Kapuso Company on June 3, 2017, the following

items were found:

Total bills and coins Php 18,250 Certified check of general manager

dated December 15, 2016 15,000 Petty cash vouchers (PCVs) not yet

replenished:

PCV No.0021 Postage stamps 2,800 PCV No.0022 Supplies 6,500

(10)

PCV No.0023 IOU employee 5,000 Company check representing replenishment

of petty cash fund 51,500

Unused stamps 1,200

 An envelope containing contributions of employees for the death of a fellow

employee (contents intact) 30,000 The petty cash fund was established for an amount of Php100,000.

1. What is the correct amount of petty cash fund at December, 2016? a. Php99,050 c Php69,750

b. Php84,750 d. Php18,250. 2. What is the amount of cash shortage or overage?

a. Php950 shortage c. Php2,150 shortage b. Php250 overage d. canot be determined

Problem 15

The following account balances are shown in the accounting records of Camil Company: January 1, 2016 December 31, 2016 Cash Php 124,000  Accounts receivable 134,000 Php 182,000 Merchandise inventory 172,000 156,000  Accounts payable 106,000 96,000

Sales for 2016 amounted to Php1,596,000 while cost of goods sold was Php1,166,000. Cash operating expenses amounted to Php214,000. All sales and purchases were

made on credit.

 Assuming that there were no other relevant transactions , what is the cash balance at December 31, 2016?

a. Php216,000 c. Php512,000 b. Php298,000 d. Php610,000

Problem 16

Camila Company is making a four column bank reconciliation at December 31 from the following data. The amounts per bank statement were:

Balance November 30, Php650,000; December Receipts, Php1,300,000; December Disbursements, Php1,100,000. The amounts per books were: Balance November 30, Php763,500; December Receipts, Php1,154,800; December Disbursements,

Php 1,123,500; Balance, December 30, Php794,800.

November 30 December 31

Deposits in transit ? Php 150,000

Outstanding checks ? 84,000

The bank overlooked a check for Php7,500 when recording a deposit on Dec 10 Note collected by bank, recorded after

receiving the bank statement 180,000

Service charge, recorded after

receiving the bank statement 4,500 6,000 NSF checks, recorded after

receiving the bank statement 56,000 48,000 Camila recorded a Php37,400 check

received from a customer in December as Php34,700.

(11)

1. The corrected cash balance on December 31 is _____________. a. Php908,500 c. Php923,500

b. Php916,000 d. Php1,007,500. 2. The corrected December receipts is

a. Php1,157,500 c. Php1,334,800 b. Php1,330,000 d. Php1,337,500 3. The corrected amount of December disbursements is

a. Php1,083,000 c. Php1,125,000 d. Php1,117,000 d. Php1,130,000 4. Deposits in transit, November 30

a. Php120,000 c. Php127,500 b. Php240,000 d. answer not given 5. Outstanding checks , November 30

a. Php67,000 c. Php120,000 b. Php70,000 d. answer not given

References

Related documents

[r]

There were four basic uses of the suffix pronouns: 1 as subject of a verbal sentence; 2 as object of a preposition; 3 as direct object after an infinitive; and 4 as possessive,

Nevertheless, there was a seemingly adequate level of understanding of differentiated instruction by primary school teachers regarding the ways to support each group of

While the percentage of this group who enjoy reading using technology increased towards the end of the project (64.2%), the most dramatic change was with regard to the number

• Palm Jumeirah • Internet City, Media City, Knowledge village • Emirates Golf Club • Jumeirah Beach • Ski Dubai • Mall of the Emirates • Souk Madinat •

When asking respondents about cosmetic procedures, only 1% admit that they intend to have Botox or collagen treatments, and 1% admit to plans for plastic surgery, still this

Possible sex differences in injury arising from head trauma have been highlighted as a critical research question (McCrory et al., 2009). To address this issue we conducted the

Comparative characteristics of mesenchymal stem cells from human bone marrow, adipose tissue, and umbilical cord blood.. Kassis I, Zangi L, Rivkin R, Levdansky L, Samuel S, Marx G,