ACCOUNTING FOR DISBURSEMENTS AND RELATED TRANSACTIONS

1. Statement 1: Government entüties are allowed by law to make purchases using credit
card.
Statement 2: The Department of National Defense is one government entity allowed to use
credit card for payments
Both statements are true.

2. Entity A purchases office supplies from an authorized merchant using an electronic card.
The journal entry to record this transaction includes a
Credit to Accounts Payable

3. Statement 1: According to the GAM for NGAs, the Advice to Debit Account (ADA) mode of
disbursement can be used only if the payee maintains an account in the same bank where
the government entity maintains an account
Statement 2: Land Bank of the Philippines is the sole government servicing bank where
Advice to Debit Account (ADA) mode of disbursement can be done
Both statements are false

4. Accoding to the GAM for NGAs, cash disbursements are made through
Cash advances to authorized personnel
5. When a government agency pays an account and withholds tax, the journal entry includes
a credit to
Due to BIR

6. Statement I: Due to stict internal control measures, a government entity can only disburse
funds via cash or check
Statement 2: Checks can be MDS or commercial checks
Only statement 2 is true

.Statement T: No additional cash advance shall be given to any offical or employee unless
the previous cash advance given to him/her is first liquidated.
Statement 2: Liquidation of cash advance for foreign travel should be done 30 days upon
return to workstation.
Only statement 1 is true

8. All of the following are considered valid cashless disbursements except:

Payment to a supplier through GCash

9. Statement 1: The Non-Cash Availment Authority (NCAA) is a disbursement authority

issued to a government agency with foreign service posts.
Statement 2: The Department of Foreign Affairs has this kind of disbursement authority.
Both statements are false

10. Statement 1: Disbursements through the Cash Disbursement Ceiling (CDC) results in
the recognition of a loan payable in the books of accounts of the BTr.
Statement 2: Since liability is recognized, the Cash Disbursement Ceiling (CDC) involves
cash inflow to the BTr.
Both statements are false.

11. Statement 1: Entity A may acquire equipment from a supplier, on account anda lender
settles the account of A by directly paying the supplier the proceeds of a loan payable that is
recorded in the BTr's books
Statement 2: this transaction is called Cash Disbursement Ceiling (CDC).
Only statement 1 is true.

12. A certification on the availability of allotment is required before a disbursement of

government funds is made. According to the GAM for NGAs, who shall issue the
certification?
Budget officer

13. Which of the following results in the recognition of payroll?

Liquidation of eash advance for travel

14. Which of the following shall certity the availability of funds and completeness of
supporting documents before the Head of Agency or his/her authorized representative can
enter into a contract that obligate the government for the eventual payment of government
funds?
Chief accountant

15. Which of the following is not used in processing disbursements?

ORs

16. Statement 1: All disbursements shall be made through Disbursement Vouchers (DV) or
payroll.
Statement 2: The head of the requisitioning unit shall approve any disbursements.
Only statement I is true

17. According to the GAM for NGAs, accounting for Petty Cash shall be done using
Imprest system

18. Statement 1: Under the Automatic Debit Arrangement (ADA) mode of disbursement,
payments from a government entity are directly debited to the accounts of the payees
through fund bank transfers.
Statement 2: Automatic Debit Arrangement (ADA) works like a check, hence, once notified,
the payee can go to the bank to withdraw the cash by presenting the notification.
Both statements are false

19. Which of the followng is not one of the modes of disbursements by a government entıty?
Payment thru Gcash

20. Which of the following is not a signatory in the LDDAP-ADA?

Payee

21. The Chief Accountant shall charge obligations incurred against available allotment to
ensure that
No overdraft is incurred

22. The Petty Cash shall be replenished when

Disbursements reach at least 75% or as needed

23. Which of the following accounts shall be debited in recording replenishment of PCF?
Appropriate expense account

24. Which of the following accounts is credited in the books of a government entity to reflect
a non-cash availment authority (NCAA) mode of disbursement?
Subsidy from National Government

25. Which of the following accounts shall be debited once cash advance has been granted?
Advances to Officers and Employees

26. When overpayment of expense related to the previous year is discovered, the journal
entry to record the overpayment includes a
Credit to accumulated surplus/(Deficit)

27. Which of the following statements regardıng the disbursement of government funds is
incorrect?
Officials and employees authorized to travel shall be granted cash advance to cover
traveling expenses. The amount granted shall be accounted for as "Due to Officers
and Employees"

28. Which of the following is not true regarding cash advance for payroll?
Advances for payroll may be used for encashment of checks or for liquidation of
previous or other types of cash advances

29. This is used to recognize in the books of national govemment agencies, the constructive
remittance to BIR and BOC of taxes" duties withheld
Tax Remittance Advice (TRA)

30. Statement 1: All disbursements require prior certification to establish their validity and
legality
Statement 2: A certification for fictitious obligation is void and results to criminal liability by
the certifying officials
Both statements are true.

31. Entity A disburses a check chargeable against its checking account maintained with
Government Servicing Bank.
The joumal entry to record disbursement involves a credit to which of the following
accounts?
Cash in Bank-Local Currency, Current Account

32. Which of the following government agencies will most likely be able to obtain
disbursement authority in the form of Cash Disbursement Ceiling (CDC)?
DFA

33. The entry in the books of a government agency with foreign service post to record the
receipt of disbursement authority called Cash Disbursement Ceiling (CDC) includes a
Credit to Subsidy from National Government

34. Which is the account credited when remitting government share for Pag-IBIG
contribution?
Due to Pag-IBIG

35. Entity A makes payment through bank transfer. This mode of disbursement is most likely
through the use of a(an)
Advice to Debit Account

36. EntityA has a foreign service post. During the period, it receives authorization from DBM
allowing it to use the collections its foreign service post to pay tor the necessary operatıng
expenses. The entry to record the disbursement authority includes a
Debit to Cash-Constructive Income Remittance

37. Payments of checks that are chargeable against the Treasury Account are credited to
the
Cash-Modified Disbursement System (MDS) account

38. According to the GAM for NGAs, disbursements for salaries and wages shall be
supported by
Payroll

39. The following disbursements are excluded from payment using LDDAP-ADA except
Payment of government employee salaries

40. Which of the following results to the recognition in the books of accounts classified as
Personnel Services?
Set up of payable for payroll

41. Which of the following is true regarding disbursement through electronic Modified
Disbursement System (eMDS)?
The disbursement is made via an online transaction.

42. It is an authority by an agency's Central Office to its regioal and operating units to cover
the latter's cash requirements.
Notice of Transfer of Allocation (NTA)

43. A government entity makes constructive remittance of taxes withheld to the BIR through
Tax Remittance Advice (TRA). The entry in recording the transaction includes a
Debit to Due to BIR

44. This is used to recognize in the books of national govemment agencies, the constructive
remittance to BIR and BOC of taxes and customs" duties withheld.
Tax Remittanee Advice (TRA)

45. When a government entity remits its collections to BTr, the journal entry to record the
remittance includes a
Debit to Cash-Treasury/Ageney Deposit, Regular

46. Entity A acquires an equipment on account and settles the account by debiting accounts
payable and crediting subsidy from national government. The mode of disbursement used is
most likely a/an
Non cash availment authority

47. Statement I: Under the ADA mode of disbursement, payments from a government entity
are directly debited to the accounts of the payees through fund/bank
Statement Il: ADA works like a check, hence, once notified, the payee can go to the back to
withdraw the cash by presenting the notification
Both statements are false

48. Which of the following is not a form of a disbursement authority?

CBC

49. Entity A wants to make disbursements online. Which of the following should Entity A do
so that it can make valid disbursements online?
Enroll with the eMDS of the LBP

50. All Disbursement Vouchers (DVs) or Payroll shall be approved by the

Head of agency

51. Which of the following shall certify the availability of allotment before obligations can be
incurred and disbursements are made?
Budget officer

52. A certification of availability of funds and completeness of supporting documents is

required before a disbursement of government funds is made. According to the GAM for
NGAs, who shall issue this certification?
Chief accountant