1. Premiere Co.

, had the following account balances as at December 31, 2019:

Cash in bank 5,200,000
Cash on hand 350,000
Cash fund set aside for dividends payable in 2020 200,000
Cash fund set aside for land acquisition in 2020 1,500,000

The Cash in bank includes a compensating balance against short-term borrowing and is not
legally restricted to withdrawal. The cash on hand included a check amounting to P100,000 payable to
the entity dated January 20, 2020.

How much is the cash presented as current assets as at December 31, 2019
a. 5,400,000
b. 5,650,000
c. 5,750,000
d. 7,150,000

2. Premiere Co., has the following account balances and information as at December 31, 2019:
Cash in bank 2,250,000
Cash on hand 125,000
Cash fund for property and equipment acquisition in 2020 1,500,000
3- month money market placement 750,000
Treasury bill purchased November 2019 maturing in January 25, 2020 500,000
Treasury bill purchased December 1, 2019 maturing in March 15, 2020 450,000

Cash in bank includes a P600,000 compensating balance against short-term borrowing

arrangement. The compensating balance is not legally restricted as to withdrawal. How much is
the cash and cash equivalent as at December 31, 2019?

a. 4,025,000
b. 4,625,000
c. 4,475,000
d. 5,075,000

3. Covid, Inc. has the following information as at December 31, 2019:

Cash on hand 500,000
Petty cash fund 20,000
PBB account – current 3,000,000
Sec Bank account #1 400,000
Sec Bank account #1 (50,000)
BSP treasury bill – 60days 4,000,000
BPI time deposit – 30 days 1,000,000

The cash on hand included a customer postdated check of P100,000. A check for P300,000 was
drawn against PNB account, dated January 15, 2020, delivered to the payee and recorded
 December 31, 2019. The BPI time deposit is set aside for acquisition of equipment. How much is
the total cash and cash equivalent as at December 31, 2019?
a. 7,470,000
b. 7,770,000
c. 8,070,000
d. 9,070,000

4. Terra Co., used the imprest system in accounting for petty cash fund. The fund had an imprest
balance of P20,000 as at December 31, 2019 which consisted of the following:
Currency and coins P1,000
Employee’s advances 3,000
Currency envelope marked “collections for Christmas party” 2,000
Check drawn payable to petty cash custodian representing salary 14,000

What is included in the entry to adjust the petty cash fund at year end.

a. Debit cash shortage/overage P2,000

b. Debit petty cash fund P15,000
c. Credit cash shortage/overage P2,000
d. Credit advances to employees P3,000

5. Ianskie Company’s records reveal the following data as at December 31, 2019:
Market placements maturing in 4 months P1,200,000
Cash on hand 500,000
Petty cash 100,000
2-month Certificate of deposits 1,000,000
Balance BDO savings account 2,500,000
Postage 50,000
Balance in PNB checking account (250,000)
Treasury bills maturing in June 15, 2020 2,200,000
Post-dated check from the customer 125,000
Employee advances 75,000
Treasury bills maturing in 1 month 500,000
Treasury bills purchased 2 months before maturity 2,000,000

How much is the cash and cash equivalent as part of the current assets as at December 31,
2019?
a. 4,350,000
b. 6,350,000
c. 4,600,000
d. 6,600,000
6. Potter Corporation’s checkbook balance as at December 31, 2019 is P160,000. Potter has the
following as at December 31, 2019:
 A P5,000 check payable to Potter Corporation, dated January 2, 2020, was included in the
December 31, 2019 check book balance.
 A P3,500 check payable to Potter Corporation which was deposited December 19 and on
December 30 marked as NSF. The check was re-deposited on January 2, 3030 and cleared on
January 9, 2020.
 A P25,000 check payable to a supplier and drawn on Potter Corporation’s account, was
dated December 31, 2019 but was not mailed until January 19, 2020. The check voucher has
not reached the accounting department.

As at December 31, 2019, how much should be the cash balance?

a. P151,500
b. P161,500
c. P176,500
d. P181,500

7. Malcolm Company assembled the following information in completing its March bank
reconciliation: balance per bank P382,000; outstanding checks P77,500; deposits in transit
P125,000; NSF check P8,000; bank service charge P2,500; erroneous book receipt P4,000; cash
balance per books P444,000. As a result of this reconciliation, Malcolm will:
a. Reduce its cash account by P14,500
b. Reduce its cash account by P2,500
c. Increase its cash account by P5,500
d. Reduce its cash account by P10,500

8. The following limited information were made available from the cash record of Clarence
Company and its bank statement for the month of December 31, 2019:

Book receipts P4,462,500

Bank receipts 4,830,000
November 30 Deposit in transit (of which
P50,000 remained to be outstanding
as at December 31, 2019 650,000
Erroneous bank credit for December 25,000
Erroneous book credit for November, corrected in December 50,000
Erroneous book debit 20,000
Erroneous bank debit in November, corrected in December 12,500
Credit memo for December not yet recorded by the Company 300,000
Credit memo for November, recorded by the
Company in December 375,000
Customer’s check received and deposited but
posted as disbursement by the Company 150,000
 What is the total amount of deposit in transit as at December 31, 2019?
a. P245,000
b. P275,000
c. P325,000
d. P375,000

What is the correct cash receipts for December?

a. P4,237,500
b. P4,287,500
c. P4,467,500
d. P4,487,500

9. The cash account shows a balance of P38,000 before reconciliation. The bank statement does
not include a deposit of P2,300 made on the last day of the month. The bank statement shows a
collection by the bank of P940 and a customer’s check for P220 was returned because it was
NSF. A customer’s check for P450 was recorded on the books as P540, and a check written for
P79 was recorded as P97. The correct cash balance in the cash account was?
a. P38,612
b. P38,828
c. P38,648
d. P40,948
10. Ease Company had the following items as at end of the current year:
Cash in bank per bank statement at current month-end 1,500,000
Equity instrument at FVPL 1,700,000
3-year time deposit purchased 2 months prior to maturity 1,200,000
Credit memo authorizing return of goods to vendor 550,000
Debit balance in accounts payable due to overpayment 300,000
Cash surrender value 150,000
Cash fund set aside to acquire property next year 500,000

A review of the records revealed that deposit in transit and outstanding checks were P600,000
and P900,000, respectively. The bank statement at month-end showed debit memo for service
charges amounting to P20,000, NSF check P180,000 and credit memo for loan proceeds
P600,000 and note collected P300,000.

What is the adjusted cash in bank?

a. 1,200,000
b. 1,900,000
c. 1,800,000
d. 2,200,000

What is the cash in bank balance per ledger?

a. 1,100,000
b. 1,400,000
 c. 300,000
d. 500,000
What amount should be reported as cash and cash equivalents
a. 2,900,000
b. 3,000,000
c. 2,700,000
d. 2,400,000

11. ABC Company reported cash account per ledger amounting to P4,700,000 as at December 31,
2019 which consisted of the following:

Petty cash fund 20,000

Undeposited receipts, including a postdated 1,500,000
customer check for P100,000
Cash in bank per bank statement, with a 2,500,000
check for P200,000 still outstanding
Deposit in bank closed by BSP 500,000
Vouchers paid out of collections, not yet 150,000
recorded
IOUs signed by employees, taken from 30,000
collections
4,700,000

What amount should be reported as cash as at December 31, 2019?

a. P3,720,000
b. P3,900,000
c. P4,220,000
d. P4,020,000

12. RAL Company reported the checkbook balance as at December 31, 2019 at P5,000,000. In
addition, the entity held the following items on the same date:
Check payable to Ral, dated January 2, 2020, 2,000,000
collection from a sale made in December
2019, not included in the December 31 check
book balance
Check payable to Ral, deposited December 15 500,000
and included in the December 31 checkbook
balance, but returned by bank on December
30 stamped as “NSF”. The check was
redeposited on January 2, 2020 and cleared
on January 9, 2020.
Check drawn on Ral’s books on December 300,000
2019 but not mailed until January 7, 2020
3-month time deposits 1,000,000
2-year treasury bill purchased 2-months 2,500,000
before maturity date, maturing on February
 1, 2020.

What amount should be reported as cash as at December 31, 2019?

a. P4,800,000
b. P5,300,000
c. P5,800,000
d. P8,300,000

13. Dove Company reported a checkbook balance as at December 31, 2019 amounting to
P4,000,000

 A customer check amounting to P200,000 dated January 2, 2020 was included in the
December 31, 2019 checkbook balance.
 Another customer’s check for P500,000 deposited on December 22, 2019 was included in
the checkbook balance but returned by the bank for insufficiency of fund. This check was
redeposited on December 26, 2019 and cleared two days later.
 A P400,000 check payable to supplier dated and recorded on December 30, 2019 was mailed
on January 16, 2020.
 A Petty cash fund of P50,000 comprised of the following on December 31, 2019:
Coins and currencies 5,000
Expense vouchers 45,000
 A check of P45,000 was drawn on December 31, 2019 payable to the petty cash custodian.

What total amount should be reported as cash as at December 31, 2019?

a. 4,250,000
b. 4,200,000
c. 4,205,000
d. 3,750,000
14. Margar Company kept all cash in a checking account. An examination of the accounting records
and bank statement for the month of December revealed a bank statement balance of
P8,470,000 and a book balance of P8,525,000.

 A deposit of P950,000 placed in the bank’s night depository on December 29 does not
appear on the bank statement.
 Checks outstanding as at December 31 amounted to P270,000
 The bank statement showed that on December 25, the bank collected a note for Margar
Company and credited the proceeds of P935,000 to the entity’s account which included
P35,000 interest.
 Margar Company discovered that a check written in December for P183,000 in payment of
an account had been recorded as P138,000
 Included in the December 31 bank statement was an NSF check for P250,000 that the
Company received from a customer on December 20.
  The bank statement showed a P15,000 service charge for December

What is the adjusted cash in bank as at December 31?

a. P9,150,000
b. P9,240,000
c. P9,195,000
d. P9,215,000
15. Ron Company provided the following data for the month of January:

Balance per book, January 31 3,130,000

Balance per bank statement, January 31 3,500,000
Collections on January 31 but undeposited 550,000
NSF check received from a customer returned 50,000
by the bank on February 5 with the January
bank statement
Outstanding checks on January 31 650,000
Bank debit memo for safety deposit box 5,000
rental not recorded by depositor
A supplier’s check for P30,000 was incorrectly 300,000
recorded by the depositor as
A customer’s check for P200,000 was 20,000
recorded by the depositor as
The deposited neglected to make an entry in 125,000
its books for a check drawn in payment of a
liability

How much is the adjusted cash in bank as at January 31

a. 3,130,000
b. 3,500,000
c. 3,400,000
d. 2,950,000

16. Gross Company provided the following information:

Balance per bank statement, May 31, 2020 1,240,000

Balance per ledger, May 31, 2020 750,000
Deposits of May 2020 not recorded by the 280,000
bank
Debit memo – service charges 10,000
Credit memo – collection of a note by bank 300,000
for the Company
Outstanding checks 550,000

An analysis of the canceled checks returned with the bank statement revealed the following:
 Check for purchase of supplies was drawn for P60,000 but was recorded as P90,000
  The manager wrote a check for travelling expenses of P100,000 while out of town. The
check was not recorded.

What amount of cash in bank should be reported as at May 31, 2020?

a. 970,000
b. 270,000
c. 550,000
d. 610,000

17. Chriss Company presented the following bank reconciliation for the month of November:

Balance per bank statement, November 30 3,600,000

Add: Deposit in transit 800,000

Balance per bank statement, November 30 3,600,000

Add: Deposit in transit 800,000
4,400,000
Less: Outstanding checks 1,200,000
Bank credit recorded in error 200,000 1,400,000
Balance per book, November 30 3,000,000

Data per bank statement for the month of December:

December deposits, including a note collected amounting to 5,500,000

P1,000,000 for the Company
December disbursements, including NSF customer check P350,000 4,400,000
and service charge P50,000

All items that were outstanding on November 30 cleared through the bank in December,
including the bank credit.

In addition, checks amounting to P500,000 were outstanding and deposits of P700,000 were in
transit as at December 31.

What is the adjusted cash in bank as at December 31?

a. 4,700,000
b. 4,900,000
c. 4,500,000
d. 3,200,000

What is the cash balance per ledger as at December 31?

a. 4,100,000
b. 4,900,000
c. 4,700,000
d. 4,300,000
 What is the amount of cash receipts per books in December?
a. 5,400,000
b. 4,400,000
c. 5,500,000
d. 6,400,000

What is the amount of cash disbursements per books in December?

a. 3,700,000
b. 3,300,000
c. 3,100,000
d. 3,500,000

18. Jam Company provided the following bank reconciliation on May 31:
Balance per bank statement 2,100,000
Deposits in transit 300,000
Outstanding checks (30,000)
2,370,000

Balance per books 2,372,000

Bank service charge (2,000)
Adjusted cash balance 2,370,000

Data for the month of June:

Bank Books
Disbursements 2,300,000 2,360,000
Deposits 1,620,000 1,800,000
Collection by bank (P400,000 note plus 420,000
interest)
NSF check returned with June 30 Statement 10,000
Balances 1,830,000 1,810,000

What is the amount of outstanding checks as at June 30?

a. 30,000
b. 90,000
c. 60,000
d. 0

What is the amount of deposits in transit as at June 30?

a. 480,000
b. 120,000
c. 180,000
d. 680,000
What is the adjusted cash in bank as at June 30?
a. 1,810,000
b. 2,220,000
c. 2,240,000
d. 2,780,000