PROBLEM 1: (KAS) =))

You have been assigned to audit the cash account of GUSTOPUMASA Company. The following are the
information that you have obtained in the process:

BANK BALANCE May 31, 2014 P 90,800
UNDEPOSITED COLLECTIONS 5,000
BANK SERVICE CHARGE 100
COLLECTION OF NOTE BY THE BANK (8,000)
OUTSTANDING CHECKS:
CHECK#0612 P 3,000
CHECK#0708 5,000
CHECK#0908 2,000



(10,000)
BOOK BALANCE May 31, 2014 P 77,900

Additional data:

a. For June:
Total collections from customers P165,000
Total checks drawn 98,000
Bank charges 123,800
Bank credits 169,000
b. CHECK#0612 was erroneously entered in the payment voucher at P30,000 instead of P3,000.
c. CHECK#0614 was issued to replace CHECK#0708 which was damaged and returned by the
payee. Both were recorded in the amount drawn but entry was made to cancel the first check
that was issued.
d. The bank statement in june included a check drawn by GOSTUPOMASA Company for P1,500.
e. The service charge for june was P 150 and was charged by the bank to another account.
f. Undeposited collections on June 30, 2014 amounts to P8,000
g. The bank collected a note during the month of june which amounts to P7,000 but was ot
received on time to be recorded by GUSTOPUMASA.
h. The outstanding checks as of June 30, 2014 were:
CHECK#0708 P5,000
CHECK#0911 1,300
CHECK#0939 2,300
CHECK#1001 4100

1. How much is the unadjusted balance per books as of June 30, 2014?
a. 152,800
b. 152,750
c. 144,900
d. 165,700
2. How much is the adjusted cash balance as of May 31, 2014?
a. P85,800
b. P58,800
c. P63,800
d. P90,800
3. How much is the adjusted book receipts for June 2014?
a. 170,500
b. 182,000
c. 172,000
d. 173,000
4. How much is the bank disbursement for June 2014?
a. 120,150
b. 76,150
c. 125,150
d. 98,150
5. Adjuste cash balance as of June 30, 2014?
a. P132,650
b. 137,650
c. 137,800
d. 134,650

PROBLEM 2: (AR)
You have been assigned to audit the accounts receivable and related accounts of PRETTYPLEASE
Company.

The balance of the Accounts Receivable control account is P788,000.

The entries that were poste in the Doubtful Accounts Expense were:
a. A debit on December 31 for the amount of the credit to the Allowance for Doubtful
Accounts
b. A credit for P1,296 on December 3, 2014 because PUMASANA Comapny remitted in full for
the accounts charged off on October 31, 2014.

Debit Credit Balance
January 1, 2014 P14,632
October 31, 2010
Uncollectible accounts
Company naksuno P1,296
Company lakasdos 3,280
Company sawakastres 2,256 P6,032 8,600
December 31, 2014 P39,400 P48,000
Table 1: The Allowance for Doubtful Accounts schedule

Age Balance Rate
0 30 days 372,960 1%
31 90 days 307,280 2%
91 180 days 88,720 3%
Over 181 days 24,000 4,000 definitely uncollectible
8,000 50% uncollectible
12, 000 20% uncollectible
Table 2: Aging Schedule of Accounts Receivable
Addional information:
a. A credit balance of P8,000 in the 0 30 days. It represents an advance on sales contract.
b. A credit balance of P2,000 in the 31 60 days for which mechandise will be accepte by the
customer.
c. Legder accounts are still open as of December 31, 2014.
d. The Accounts Receivable cotrol account is not in agreement with the subsiiary ledger.
Note:
Adjust the control account to the sum of the subsidiaries after the corrections are made.

6. How much is the adjusted balance of Accounts Receivable as of December 31, 2014?
a. 794,000
b. 793,200
c. 798,960
d. 802,960
7. How much is the adjusted balance of the Allowance for Doubtful Accounts as of December 31,
2014?
a. 63,552
b. 23,057
c. 18,937
d. 19,057
8. How much is the net adjustment to the Allowance for Doubtful Accounts?
a. 24,493 debit
b. 15,552 credit
c. 28,943 debit
d. 29,063 debit
9. How much is the Doubtful Accounts Expense for the year 2014?
a. 13,961
b. 58,456
c. 18,411
d. 13,841
10. How much is the net ajustment to the Doubtful Accounts Expense account?
a. 20,352 debit
b. 24,263 credit
c. 24,143 credit
d. 19,693 credit