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06 Task Performance 1 ARG

The document provides budgetary information for a municipality including estimated and actual income, appropriations, allotments, and obligations. It requires preparing adjusting entries, a post-closing trial balance, computing over and underestimations, and adjusting entries for estimates.

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93 views4 pages

06 Task Performance 1 ARG

The document provides budgetary information for a municipality including estimated and actual income, appropriations, allotments, and obligations. It requires preparing adjusting entries, a post-closing trial balance, computing over and underestimations, and adjusting entries for estimates.

Uploaded by

shiplus
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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BUDGETARY ACCOUNTS

Direction: Read the problem and give what are required. Write your answers on another sheet of paper.

The Municipality of Loboc has the following data for the calendar year 20X1:

Annual Budget
Estimates of Income Appropriations
Tax Revenue:
Basic Real Property Tax P10,000 Personal Services P6,000
Business Tax 5,000 Maintenance and Other Operating Expenses 10,000
Share from National Taxes: Capital Outlay 18,000
Share from Internal Revenue Collection 30,000 20% Development Fund 6,000
Total: P45,000 Total: P40,000

It releases the following allotments:

Personal Services P4,000


Maintenance and Other Operating Expenses 7,000
Capital Outlay 13,000
20% Development Fund 6,000
Total P30,000

Its realized estimates of income for the year are:

Tax Revenue
Basic Real Property Tax P6,000
Business Tax 3,000
Share from National Taxes
Share from Internal Revenue Collection 30,000
P39,000

It has the following current obligations based on Certifications on Appropriations, Funds, and Obligations of Allotment
(CAFAO).

Personal Services P3,000


Maintenance and Other Operating Expenses 4,000
Capital Outlay 10,000
20% Development Fund 6,000
Total P23,000

It recorded the following consummated obligations:

Personal Services P2,500


Maintenance and Other Operating Expenses 4,000
Capital Outlay 8,500
20% Development Fund 6,000
Total P21,000

Required: Prepare the following:


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a. All necessary adjusting entries.

b. Post-closing trial balance. (5 points)

c. Table for the computation of over and underestimation. (5 points)

d. Entries to record the adjustment for the over and underestimates.

Solutions:

a.

Estimates of Income Revenues and Receipt 3-05-02-010 45,000


Estimates – Internal Sources 3-05-02-020 15,000
Estimates – External Sources 3-05-02-030 30,000
To record estimated sources of revenues and receipts for appropriation.

Appropriations – Annual Budget 3-05-02-050 40,000


Legislative Appropriations 3-05-02-070 40,000
To record the appropriations.

Released Current Allotment 3-05-02-080 30,000


Current Allotment 3-05-02-090 30,000
To record release of allotment.

Fund Balance 3-05-01-010 39,000


Realized Income Revenues and Receipts 3-05-02-040 39,000
To record realized estimates of income based on the Report of the Realized Budgetary Income Revenues and Receipts.

Current Allotments – Obligated 3-05-03-010 23,000


Obligations – Current Allotment 3-05-03-020 23,000
To record the obligation from current allotment based on the CAFOA.

Current Allotments – Obligations Consummated 3-05-03-050 21,000


Consummated Obligations 3-05-03-070 21,000
To record consummated obligations from current allotment.

b.
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Post-closing trial balance

Account Title Account Code Dr. Bal. Cr. Bal.


Fund Balance 3-05-01-010 10,000
Continuing Allotment 3-05-01-030 3,000
Continuing Appropriations 3-05-01-040 5,000
Commitments 3-05-01-050 2,000
Total 10,000 10,000

Solution for Post-closing trial balance:

Reversion of non-continuing appropriations and allotments

Account Title Appropriati Allotments Balance Obligation Balance Consumm Commitmen


ons ated t
Personal Services 6,000 4,000 2,000 3,000 1,000 2,500 500
MOOE 10,000 7,000 3,000 4,000 3,000 4,000 -0-
CO 18,000 13,000 5,000 10,000 3,000 8,500 1,500
20% Development 6,000 6,000 -0- 6,000 -0- 6,000 -0-
Fund
Total 40,000 30,000 10,000 23,000 7,000 21,000 2,000

Legislative Appropriations 3-05-02-070 5,000


Continuing Appropriations 3-05-01-040 5,000
To record continuing appropriations.

Current Allotment 3-05-02-090 3,000


Continuing Allotments 3-05-01-030 3,000
To record continuing allotment.

Obligations – Current Allotment 3-05-03-010 2,000


Commitments 3-05-01-050 2,000
To close obligations from current not yet consummated.

c.

Adjustment for overestimated and underestimated income

A. Adjustment of over/under estimated income: Estimate Actual (Over)under Estimate


Tax Revenue
Real Property Tax – Basic 10,000 6,000 (4,000)
Business Tax 5,000 3,000 (2,000)
Share from National Taxes
Share from Interna Revenue Collections 30,000 30,000 -
Total 45,000 39,000 (6,000)

d.
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Estimates of Income Revenues and Receipts 3-05-02-010 (4,000)
(2,000)
Estimates – Internal Sources 3-05-02-020 (6,000)
To record adjustment of overestimated income.

This study source was downloaded by 100000886485644 from CourseHero.com on 06-02-2024 06:56:07 GMT -05:00

https://www.coursehero.com/file/106948349/06-Task-Performance-1-ARGdocx/
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