4 Revenue 30 Questions

A government entity collects fees for the processing of certain permits.
The processing of a permit

would normally takes few minutes. The processing fee is collected upon issuance of the permit. This
government entity would normally recognize revenue from permit fees
on a straight line basis
by reference to the stage of completion.
upon collection of the fee
when the significant risks and rewards are transferred to the customer.
According to the GAM for NGAs, an exchange of goods or services of similar nature and value
between entities
A. gives rise to revenue measured at the fair value of the goods or services received, adjusted for
any cash paid or received on the exchange.
B. gives rise to revenue measured at the fair value of the goods or services given up, adjusted for
any cash paid or received on the exchange
C.a or b, whichever is more clearly determinable.
d. does not give rise to revenue
When cash flows are deferred, the fair value of the consideration receivable is its present value.
true
false
The taxable event for income tax is the passage of the time period for which the tax is levied. <br />
true
false
Revenues of a government entity arise from exchange transactions only.

true
false
Taxes are compulsory payments, imposed on persons properties or activities, intended to provide
revenue to the government. Taxes include fees, lines and penalties. <br />
true
false
According to the GAM for NGAs, the receipt of concessionary loans by government entities may give
rise to revenue recognition.
true
false
The receipt of which of the following may not give rise to revenue by a government entity?
Notice of Cash Allocation
Tax Remittance Advice
Subsidy from another government entity
Inter-agency fund transfer
According to the GAM for NGAs, all of the following criteria must be met before a government entity
recognizes revenue from the sale of goods, except
Significant risks and rewards of ownership of the goods are transferred to the buyer and the entity
does not retain control over those goods.
It is probable that economic benefits will flow to the entity.
The amounts of revenue and related costs can be measured reliably
The stage of completion can be measured reliably.
The main source of revenue for the government is taxes.

true
false
According to the GAM for NGAs, interest revenue is recognized

on a time proportion basis using the effective interest method
on a straight line basis
in accordance with the substance of the relevant loan agreement.
when the entity's right to receive payment is established.
The national government receives a foreign grant conditioned on the construction of a public
infrastructure. According to the GAM for NGAs, when does the national government recognize
revenue from the grant (i.e., credit to the 'Income from Grants and Donations in Cash' account)?
Upon receipt of the grant.
When the grant becomes receivable, provided there is reasonable assurance that the attached
condition will be satisfied
When the condition is met.
When the related expenses for which the grant is intended to compensate are incurred.
Payments to government entities in the form of checks are not allowed.

true
false
Which of the following would result to an increase or decrease in the revenue reported by a
government' 'entity in its statement of financial performance?
Impairment loss on an amount already recognized as revenue.
Receipt of a pledge
Receipt of donation in the form of services in kind.
The repayment of a loan payable is forgiven.
The constructive remittance of taxes withheld through the TRA gives rise to the recognition of
revenue. <br />
true
false
Entity A enters into a long-term contract to provide services. The outcome of the transaction can be
estimated reliably and the progress on the contract can be measured with sufficient reliability.
According to the PPSAS, how should Entity A recognize revenue from the contract?
On a straight line basis over the contract term
By reference to the stage of completion of the contract at the reporting date.
Full recognition of contract price upon completion of the contract.
Only to the extent of costs that are expected to be recovered.
According to the GAM for NGAs, which of the following may never give rise to revenue for a
government entity?
Services in-kind
Debt forgiveness
Concessionary loan
Grant with condition
According to the GAM for NGAs, when the outcome of a service contract cannot be estimated
reliably, revenue is recognized
on a straight line basis over the periods the services are rendered
by reference to the contract's stage of completion at each reporting date.
nly to the extent of costs that are expected to be recovered.
only upon the completion of the contract.
When an amount already recognized as revenue becomes subsequently uncollectible, it is

recognized as expense.
recognized as an adjustment to the revenue originally recognized.
not recognized
Gifts, donations and goods in-kind with condition are recognized

as revenue immediately upon the receipt thereof.
initially as liability and recognized as revenue only when the condition is satisfied
as revenue measured at fair value only when actually received.
directly in equity.
Imposition and collection of tax revenue is considered a(an)

exchange transaction
non exchange transaction
donation
any of these
All revenues shall be remitted to the BTr and included in the Special Fund, unless another law
specifically requires otherwise. <br />
true
false
It is a type of fund held by a government entity that is designated for special purposes.
General fund
Special fund
Trust fund
Fiduciary fund
According to the GAM for NGAs, revenue from exchange transactions are measured at the amount
of cash received.
true
false
Which of the following receipts of a government entity will give rise to revenue recognition?
Receipt of excess cash advance
Receipt of refund for overpayment of expenses
Receipt of performance bond
Receipt of subsidy from the National Government or other National Government Agencies.
The receipt of a performance bond or a security deposit is credited to a

liability account
revenue account
cash account
Entity A sells goods with a list price of $100,000, on account. The credit term is 20% and 10%. The
journal entry to recognize the revenue includes all of the following except?
A debit to accounts receivable for P72,000.
A credit to sales revenue for P 72,000.
A debit to sales discount for P28,000.
All of these are included in the entry.
The taxable event for Value added tax (VAT) is the a undertaking of
taxable activity.
earning of taxable income
movement of dutiable goods or services across the customs boundary.
any of these
Which of the following is a non-exchange transaction?
Leasing
Collection of taxes
Rendering of legal services
Collection of tuition fees
Which of the following is not one of the fundamental principles for revenue under P.D. No. 1445?
All revenues shall be remitted to the BTr and included in the General Fund, unless another law
specifically allows otherwise.
Recording of revenue in other types of funds (e.g., Special Fund) shall be made only when
authorized by law.
Collections of revenue shall be properly acknowledged through pre-numbered Official Receipts.
All collections of revenue must be in the form of cash. Checks are not acceptable

4 Revenue 30 Questions

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4 Revenue 30 Questions

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A government entity collects fees for the processing of certain permits.

The processing of a permit

Revenues of a government entity arise from exchange transactions only.

The main source of revenue for the government is taxes.

According to the GAM for NGAs, interest revenue is recognized

Payments to government entities in the form of checks are not allowed.

When an amount already recognized as revenue becomes subsequently uncollectible, it is

Gifts, donations and goods in-kind with condition are recognized

Imposition and collection of tax revenue is considered a(an)

The receipt of a performance bond or a security deposit is credited to a

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