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Questions and Answers
What is the condition for recognizing individual items of PPE as a group?
What is the condition for recognizing individual items of PPE as a group?
How are trade discounts treated in the initial measurement of items of PPE according to GAM for NGAs?
How are trade discounts treated in the initial measurement of items of PPE according to GAM for NGAs?
What is the treatment of items below the capitalization threshold of PPE?
What is the treatment of items below the capitalization threshold of PPE?
How are provision for decommissioning and restoration costs of an item of PPE subsequently measured?
How are provision for decommissioning and restoration costs of an item of PPE subsequently measured?
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What are the two models that government entities may choose from to subsequently measure their PPE?
What are the two models that government entities may choose from to subsequently measure their PPE?
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What is the typical residual value assigned to items of PPE by government entities?
What is the typical residual value assigned to items of PPE by government entities?
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When do government entities recognize depreciation on PPE?
When do government entities recognize depreciation on PPE?
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When is an item of PPE derecognized?
When is an item of PPE derecognized?
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What is the net amount paid to MERALCO?
What is the net amount paid to MERALCO?
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What is the invoice price of the construction equipment purchased by DPWH?
What is the invoice price of the construction equipment purchased by DPWH?
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What is the estimated useful life of the asset purchased by DPWH?
What is the estimated useful life of the asset purchased by DPWH?
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What is the depreciation expense for 2020?
What is the depreciation expense for 2020?
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What is the book value of the equipment on December 31, 2021?
What is the book value of the equipment on December 31, 2021?
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What is the amount of cash advance granted to Department Heads?
What is the amount of cash advance granted to Department Heads?
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What is the debit account in the journal entry to recognize liquidation of cash advance?
What is the debit account in the journal entry to recognize liquidation of cash advance?
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What is the total amount of invoices paid to MERALCO and PLDT?
What is the total amount of invoices paid to MERALCO and PLDT?
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What is the total amount of payments made to ESJAY CORP. and MANARA MKTG.?
What is the total amount of payments made to ESJAY CORP. and MANARA MKTG.?
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What is the total amount of contributions made to Retirement & Life Insurance, PAG-IBIG, and PHIL-HEALTH?
What is the total amount of contributions made to Retirement & Life Insurance, PAG-IBIG, and PHIL-HEALTH?
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What is the total amount of Employees Compensation Insurance Premiums?
What is the total amount of Employees Compensation Insurance Premiums?
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What is the correct entry to record the advances relating to payroll in a national government agency?
What is the correct entry to record the advances relating to payroll in a national government agency?
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What is the total amount of payments made to MANILA WATER and TIP TOP CO.?
What is the total amount of payments made to MANILA WATER and TIP TOP CO.?
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What is the total amount of payments made to MERALCO, PLDT, MANILA WATER, and TIP TOP CO.?
What is the total amount of payments made to MERALCO, PLDT, MANILA WATER, and TIP TOP CO.?
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What is required for the establishment of a petty cash fund according to GAM for NGAs?
What is required for the establishment of a petty cash fund according to GAM for NGAs?
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What is the purpose of a petty cash fund?
What is the purpose of a petty cash fund?
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What happens if the cash on hand and petty cash vouchers (PCV) do not equal the ledger balance of the petty cash fund?
What happens if the cash on hand and petty cash vouchers (PCV) do not equal the ledger balance of the petty cash fund?
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What is the system of handling petty cash fund called if the cash on hand and petty cash vouchers must be equal to the ledger balance?
What is the system of handling petty cash fund called if the cash on hand and petty cash vouchers must be equal to the ledger balance?
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Who is responsible for approving the establishment of a petty cash fund?
Who is responsible for approving the establishment of a petty cash fund?
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What is the purpose of petit cash vouchers (PCV)?
What is the purpose of petit cash vouchers (PCV)?
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What happens if there is a shortage in the petty cash fund?
What happens if there is a shortage in the petty cash fund?
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Why is a petty cash fund used?
Why is a petty cash fund used?
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What is the total amount of taxes withheld?
What is the total amount of taxes withheld?
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What is the unused NCA for the month of January?
What is the unused NCA for the month of January?
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What is the total obligations incurred for Personnel Services?
What is the total obligations incurred for Personnel Services?
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What is the total amount remitted to GSIS?
What is the total amount remitted to GSIS?
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What is the 'Net Financial Assistance/Subsidy' to be reported in the Statement of Financial Performance?
What is the 'Net Financial Assistance/Subsidy' to be reported in the Statement of Financial Performance?
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What is the surplus (deficit) for the period?
What is the surplus (deficit) for the period?
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What is the total revenue earned from billings and collections of unbilled income?
What is the total revenue earned from billings and collections of unbilled income?
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What is the unused balance of Cash – MDS, Regular at the end of the period?
What is the unused balance of Cash – MDS, Regular at the end of the period?
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Study Notes
Government Accounting and Management (GAM) for National Government Agencies (NGAs)
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Petty cash fund establishment requires approval of the Head of the Agency, not the President of the Republic of the Philippines.
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Petty cash fund handling system involves reconciling cash on hand and petty cash vouchers (PCVs) to the ledger balance to ensure equality, and any difference is either a shortage or overage.
Accounting for Property, Plant, and Equipment (PPE)
- Trade discounts are excluded from initial measurement of PPE, but not cash discounts.
- Items below the capitalization threshold are not recognized as PPE, but as Semi-Expendable Property – a separate class of PPE.
- Provision for decommissioning and restoration costs of PPE is subsequently measured at amortized cost.
- Government entities may choose either the cost model or revaluation model to subsequently measure PPE.
- Government entities normally assign a residual value of 10% of cost to PPE.
- Depreciation on PPE is typically recorded on a monthly basis.
Accounting for Disbursements and Inventory
- A government entity derecognizes an item of PPE that is idle, fully depreciated, or unserviceable.
- Inventory and Construction and Heavy Equipment acquisitions are recorded at cost, and depreciation is calculated accordingly.
Government Accounting and Management (GAM) for Liquidation of Cash Advances
- A cash advance is granted to defray expenses, and a liquidation report is submitted to justify the expenses incurred.
- Journal entries for liquidation of cash advance involve crediting Advances to Officers and Employees and debiting relevant expense accounts.
Government Accounting and Management (GAM) for Payroll and NCA
- Payment of government share includes Retirement & Life Insurance Contributions, PAG-IBIG Contributions, PHIL-HEALTH Contributions, and Employees Compensation Insurance Premiums.
- Receipt of NCA for the month is recorded by debiting Cash – MDS Regular and crediting Subsidy from National Government.
- Advances relating to payroll are recorded by debiting Advances to Officers & Employees or Due from Officers & Employees.
Accounting for Taxes Withheld and NCA
- Taxes withheld include withholding taxes, and the total amount of taxes withheld is recorded accordingly.
- Unused NCA for the month is calculated by subtracting total obligations incurred from total NCA received.
- Net Financial Assistance/Subsidy is calculated by adding unused NCA, total revenue, and total taxes withheld, then subtracting total expenses.
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Description
Practice quiz for government accounting students, covering topics related to accountancy and finance.