Unit I: Review of the Accounting Cycle for Service Business page 1 Date Jan 2 Cash Particulars F 101 301

Debit 500,000.00 Credit 500,000.00

Andrea Ramos, Capital Initial Investment. 3 Prepaid Rent Cash Paid rent covering a 3 month period starting January. 4 Equipment Cash Purchased 3 photocopying machines. 5 Furniture and Fixtures Cash Purchased tables and chairs. 6 Photocopying supplies Cash Accounts Payable - Goodwill Store Purchased supplies, balance payable in 15 days. 18 Accounts Receivable - Eastern University Service Income Billed Eastern University for services rendered. 21 Accounts Payable - Goodwill Store Cash Settled account with Goodwill Store. 25 Cash Accounts Receivable - Eastern University Collected account from Eastern University. 28 Andrea Ramos, Drawing Cash Withdrew cash for personal use. 31 Cash Service Income Received cash for services rendered. 31 Salaries Expense Cash Withholding Tax Payable Paid salary of an office assistant.

103 101

30,000.00 30,000.00

111 101

150,000.00 150,000.00

112 101

12,000.00 12,000.00

104 101 201

40,000.00 20,000.00 20,000.00

102 401

3,500.00 3,500.00

201 101

20,000.00 20,000.00

101 102

3,500.00 3,500.00

302 101

10,000.00 10,000.00

101 401

28,200.00 28,200.00

501 101 202

8,400.00 7,900.00 500.00

Unit I: Review of the Accounting Cycle for Service Business MultipliCity Trial Balance January 31, 2010 Account Titles Cash Prepaid Rent Photocopying Supplies Equipment Furniture and Fixtures Withholding Tax Payable Andrea Ramos, Capital Andrea Ramos, Drawing Service Income Salaries Expense Total P Debit 281800.00 30,000.00 40,000.00 150,000.00 12,000.00 P 10,000.00 31,700.00 8,400.00 P 532200.00 P 532200.00 Credit

500.00 500,000.00

Unit I: Review of the Accounting Cycle for Service Business page 3 Date Particulars Jan 31 Service Income Income and Expense Summary To close the books. Income and Expense Summary Photocopying Supplies Expense Rent Expense Salaries Expense Utilities Expense Depreciation Expense To close the books. Andrea Ramos, Drawing Income and Expense Summary To close the books. Andrea Ramos, Capital Andrea Ramos, Drawing To close the books. Feb 1 Accrued Utilities Expense - MERALCO Utilities Expense - MERALCO To reverse entries. Accrued Utilities Expense - Maynilad Utilities Expense - Maynilad To reverse entries. Service Income Accounts Receivable - Philippine College To reverse entries. F Debit 33,500.00 Credit 33,500.00

67,300.00 38,500.00 10,000.00 8,400.00 7,800.00 2,600.00

33,800.00 33,800.00

43,800.00 43,800.00

6,100.00 6,100.00

1,700.00 1,700.00

1,800.00 1,800.00

Unit I: Review of the Accounting Cycle for Service Business MultipliCity Post-Closing Trial Balance January 31, 2010 Account Titles Cash Prepaid Rent Photocopying Supplies Equipment Less: Accumulated Depreciation - Equipment Furniture and Fixtures Less: Accumulated Depreciation - Furniture and Fixtures Withholding Tax Payable Accrued Utilities Expense - MERALCO Accrued Utilities Expense - Maynilad Andrea Ramos, Capital Debit 281800.00 30,000.00 40,000.00 150,000.00 12,000.00 100.00 500.00 6,100.00 1,700.00 456,200.00 Credit

P 2,500.00

Total

467,100.00 P

467,100.00

Unit I: Review of the Accounting Cycle for Service Business Cash Debit 500,000.00 3,500.00 28,200.00 101 Credit 30,000.00 150,000.00 12,000.00 20,000.00 20,000.00 10,000.00 7,900.00

Date Jan 2 25 31

Particulars

F GJ1 GJ1 GJ1

Date Jan

Particulars 3 4 5 6 21 28 31

F GJ1 GJ1 GJ1 GJ1 GJ1 GJ1 GJ1

31 Balance

281,800.00 Accounts Receivable Date F Debit 3,500.00 GJ1 Jan Prepaid Rent Debit 30,000.00 30,000.00 Photocopying Supplies Date F Debit 40,000.00 GJ1 40,000.00 Equipment Debit 150,000.00 150,000.00 Furniture and Fixtures Date F Debit 12,000.00 GJ1 12,000.00 Accounts Payable Date Debit 20,000.00 Jan 201 Credit 20,000.00 202 Credit 500.00 500.00 112 Credit 111 Credit 104 Credit Date 102 Credit 3,500.00 103 Credit

Date Jan 18 Date 3 Jan

Particulars

Particulars 25

F GJ1

Particulars

F GJ1

Particulars

31 Balance

Date 6 Jan

Particulars

Particulars

31 Balance

Date 4 Jan

Particulars

F GJ1

Date

Particulars

31 Balance

Date 5 Jan

Particulars

Particulars

31 Balance

Date Jan 21 Date

Particulars

F GJ1

Particulars 6

F GJ1

Particulars

Withholding Tax Payable Date F Debit Jan

Particulars 31 31 Balance

F GJ1

Unit I: Review of the Accounting Cycle for Service Business page 2 Date Particulars Jan 31 Photocopying Supplies Expense Photocopying Supplies To adjust for the used portion of photocopying supplies. 31` Utilities Expense - MERALCO Accrued Utilities Expense - MERALCO To accrue for utilities expense (MERALCO). 31 Utilities Expense - Maynilad Accrued Utilities Expense - Maynilad To accrue for utilities expense (Maynilad). 31 Accounts Receivable - Philippine College Service Income Billed Philippine College for services rendered. 31 Depreciation Expense - Equipment Accumulated Depreciation - Equipment To record depreciation. 31 Depreciation Expense - Furniture and Fixtures Accumulated Depreciation - Furniture and Fixtures To record depreciation. 31 Rent Expense Prepaid Rent Expense\ To adjust for the used portion of prepaid rent. F Debit 38,500.00 Credit 38,500.00

6,100.00 6,100.00

1,700.00 1,700.00

1,800.00 1,800.00

2,500.00 2,500.00

100.00 100.00

10,000.00 10,000.00

Unit I: Review of the Accounting Cycle for Service Business MultipliCity Statement of Financial Position January 31, 2010 ASSETS Current Assets Cash Accounts Receivable Prepaid Expenses Non-Current Assets Property, Plant and Equipment Total Assets LIABILITIES AND OWNER'S EQUITY Current Liabilities Trade and Other Payables Owner's Equity Andrea Ramos, Capital Total Liabilities and Owner's Equity P 281,800.00 1,800.00 21,500.00

Note 3

P 305,100.00

Note 4

159,400.00 P 464,500.00

Note 5

P 8,300.00

456,200.00 P 464,500.00

Unit I: Review of the Accounting Cycle for Service Business Andrea Ramos, Capital Date F Debit Jan 301 Credit 500,000.00 500,000.00 302 Credit

Date

Particulars

Particulars 2 31 Balance

F GJ1

Date Jan 28

Particulars

Andrea Ramos, Drawing Date F Debit GJ1 10,000.00 10,000.00 Service Income Debit

Particulars

31 Balance

Date

Particulars

Date Jan

Particulars 18 31 31 Balance

F GJ1 GJ1

401 Credit 3,500.00 28,200.00 31,700.00 501 Credit

Date Jan 31

Particulars

F GJ1

Salaries Expense Date Debit 8,400.00 8,400.00

Particulars

31 Balance

Unit I: Review of the Accounting Cycle for Service Business MultipliCity Income Statement For the month ending January 31, 2010 Revenues Service Income Expenses Photocopying Supplies Expense Rent Expense Salaries Expense Utilities Expense Depreciation Expense Net Loss

33,500.00

Note 1 Note 2

38,500.00 10,000.00 8,400.00 7,800.00 2,600.00 P

(67,300.00) 33,800.00

MultipliCity Statement of Changes in Owner's Equity For the month ending January 31, 2010 Andrea Ramos, Capital - beginning Less: Net Loss Less: Andrea Ramos, Drawing Andrea Ramos, Capital - end P P 33,800.00 10,000.00 P 500,000.00 (43,800.00) 456,200.00

MultipliCity Statement of Cash Flows For the month ending January 31, 2010 Cash Flows from Operating Activities Cash Receipts from Customers Cash Payments for Operating Expenses Cash Flows from Investing Activities Purchase of Equipment Purchase of Furniture and Fixtures Cash Flows from Financing Activities Initial Investment Withdrawals Net Increase in Cash Cash Balance - beginning Cash Balance - end

31,700.00 (77,900.00)

(P

46,200.00)

(P 150,000.00) (12,000.00) P 500,000.00 (10,000.00)

(162,000.00)

40,000.00 P 281,800.00 0.00 P 281,800.00

Unit I: Review of the Accounting Cycle for Service Business Notes to the Financial Statements Note 1 - Utilities Expense Utilities Expense - MERALCO Utilities Expense - Maynilad Total Note 2 - Depreciation Expense Depreciation Expense - Equipment Depreciation Expense - Furniture and Fixtures Total Note 3 - Prepaid Expenses Prepaid Rent Photocopying Supplies Total Note 4 - Property, Plant and Equipment Equipment Less: Accumulated Depreciation - Equipment Furniture and Fixtures Less: Accumulated Depreciation - Furniture and Fixtures Total Note 5 - Trade and Other Payables Withholding Tax Payable Accrued Utilities Expense - MERALCO Accrued Utilities Expense - Maynilad Total

P 6,100.00 1,700.00 P 7,800.00

P 2,500.00 100.00 P 2,600.00

P 20,000.00 1,500.00 P 21,500.00

P 150,000.00 (2,500.00) P 12,000.00 (100.00)

P 147,500.00 11,900.00 P 159,400.00

500.00 6,100.00 1,700.00 P 8,300.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-4:Purchase and Sale of Merchandise with Returns and Partial Payments page 1 Date Particulars June 8 Accounts Receivable - Rose Daycare Center Sales Sold computer at 50% above cost. Cost of Goods Sold Merchandise Inventory Cost of Merchandise sold. 9 Sales Returns and Allowances Accounts Receivable - Rose Daycare Center Granted allowance. 12 Cash Accounts Receivable - Rose Daycare Center Received partial payment of account. 25 Cash Accounts Receivable - Rose Daycare Center Collection from customer. Mar 1 Merchandise Inventory Cash Accounts Payable - RGM Trading Terms: 50% down, balance on account. 2 Accounts Payable - RGM Trading Merchandise Inventory Returned Merchandise. 5 Accounts Payable - RGM Trading Cash Made partial payment. 11 Accounts Payable - RGM Trading Guada, Capital Paid account using personal check of the owner, Guada. F Debit 75,000.00 Credit 75,000.00

50,000.00 50,000.00

1,500.00 1,500.00

20,000.00 20,000.00

53,500.00 53,500.00

20,000.00 10,000.00 10,000.00

300.00 300.00

5,000.00 5,000.00

4,700.00 4,700.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-5: Purchase and Sale of Merchandise with Trade and Cash Discounts page 1 Date July 1 Merchandise Invetory Argem, Capital Additional Investment. Particulars F Debit 85,000.00 Credit 85,000.00

4 Merchandise Inventory Cash Accounts Payable - Pio Marketing Terms: 50% down, balance 2/15, n/30. 7 Accounts Receivable - Maffy's Merchandising Sales Sold merchandise on terms: 2/10, 1/15, n/30 Cost of Goods Sold Merchandise Inventory Cost of Merchandise sold. 10 Freight - Out Cash Paid freight. 12 Accounts Payable - Pio Marketing Merchandise Inventory Issued debit memo. 15 Sales Returns and Allowances Accounts Receivable - Maffy's Merchandising Issued credit memo. Merchandise Inventory Cost of Goods Sold Cost of Merchandise returned. 18 Accounts Payable - Pio Marketing Cash Merchandise Inventory Settled account in full. 19 Cash Accounts Receivable - Maffy's Merchandising Received partial payment.

90,000.00 45,000.00 45,000.00

55,290.00 55,290.00

25,000.00 25,000.00

1,200.00 1,200.00

1,000.00 1,000.00

2,500.00 2,500.00

1,000.00 1,000.00

44,000.00 43,120.00 880.00

26,395.00 26,395.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-5: Purchase and Sale of Merchandise with Trade and Cash Discounts page 3 Date July 1 Purchases Argem, Capital Additional Investment. Particulars F Debit 85,000.00 Credit 85,000.00

4 Purchases Cash Accounts Payable - Pio Marketing Terms: 50% down, balance 2/15, n/30. 7 Accounts Receivable - Maffy's Merchandising Sales Sold merchandise on terms: 2/10, 1/15, n/30 10 Freight - Out Cash Paid freight. 12 Accounts Payable - Pio Marketing Purchase Returns and Allowances Issued debit memo. 15 Sales Returns and Allowances Accounts Receivable - Maffy's Merchandising Issued credit memo. 18 Accounts Payable - Pio Marketing Cash Purchase Discounts Settled account in full. 19 Cash Accounts Receivable - Maffy's Merchandising Received partial payment.

90,000.00 45,000.00 45,000.00

55,290.00 55,290.00

1,200.00 1,200.00

1,000.00 1,000.00

2,500.00 2,500.00

44,000.00 43,120.00 880.00

26,395.00 26,395.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-6: Journalizing Merchandising Transactions page 1 Date Particulars May 1 Merchandise Inventory Accounts Payable - Gabrielle Novelty Shop Terms: 2/10, n/30. 1 Merchandise Inventory Cash Paid freight. 3 Accounts Receivable - Rafaela Department Store Sales Terms: 2/10, 1/15, n/30. Cost of Goods Sold Merchandise Inventory Cost of Merchandise sold. 4 Accounts Payable - Gabrielle Novelty Shop Merchandise Inventory Returned goods. 7 Accounts Payable - Gabrielle Novelty Shop Cash Made Partial Payment 9 Cash Accounts Receivable - Judielle Boutique Sales Terms: 50% down, balance 2/10, 1/15, n/30 Cost of Goods Sold Merchandise Inventory Cost of Merchandise sold. 11 Accounts Payable - Gabrielle Novelty Shop Merchandise Inventory Cash Paid account in full. 14 Sales Returns and Allowances Accounts Receivable - Judielle Boutique Granted Allowance 17 Merchandise Inventory Cash Accounts Payable - Legion Trading Terms: 25% down, balance 2/eom, n/30. F Debit 21,000.00 Credit 21,000.00

500.00 500.00

9,000.00 9,000.00

6,000.00 6,000.00

600.00 600.00

10,000.00 10,000.00

7,500.00 7,500.00 15,000.00

9,000.00 9,000.00

10,400.00 408.00 9,992.00

300.00 300.00

30,000.00 7,500.00 22,500.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-6: Journalizing Merchandising Transactions page 3 Date Particulars May 1 Purchases Accounts Payable - Gabrielle Novelty Shop Terms: 2/10, n/30. 1 Freight - In Cash Paid freight. 3 Accounts Receivable - Rafaela Department Store Sales Terms: 2/10, 1/15, n/30. 4 Accounts Payable - Gabrielle Novelty Shop Purchase Returns and Allowances Returned goods. 7 Accounts Payable - Gabrielle Novelty Shop Cash Made Partial Payment 9 Cash Accounts Receivable - Judielle Boutique Sales Terms: 50% down, balance 2/10, 1/15, n/30 11 Accounts Payable - Gabrielle Novelty Shop Purchase Discount Cash Paid account in full. 14 Sales Returns and Allowances Accounts Receivable - Judielle Boutique Granted Allowance 17 Purchases Cash Accounts Payable - Legion Trading Terms: 25% down, balance 2/eom, n/30. 20 Cash Sales Discount Accounts Receivable - Judielle Boutique Collection from customer. F Debit 21,000.00 Credit 21,000.00

500.00 500.00

9,000.00 9,000.00

600.00 600.00

10,000.00 10,000.00

7,500.00 7,500.00 15,000.00

10,400.00 408.00 9,992.00

300.00 300.00

30,000.00 7,500.00 22,500.00

7,128.00 72.00 7,200.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-8: Four Cases of Freight page 1 Date Particulars Sept 2 Purchases Cash Accounts Payable - Agnes Merchandising Purchased goods on terms: 50% down, balance 2/10, n/30. Freight - In Cash FOB Shipping Point, collect. 3 Accounts Payable - Agnes Merchandising Purchase Returns and Allowances Issued debit memo. 6 Accounts Payable - Agnes Merchandising Cash Made partial payment. 12 Accounts Payable - Agnes Merchandising Cash Purchase Discounts Settled account in full. F Debit 60,000.00 Credit 30,000.00 30,000.00

1,000.00 1,000.00

2,000.00 2,000.00

10,000.00 10,000.00

18,000.00 17,440.00 560.00

Sept

2 Purchases Cash Accounts Payable - Agnes Merchandising Purchased goods on terms: 50% down, balance 2/10, n/30. Freight - In Accounts Payable - Agnes Merchandising FOB Shipping Point, Prepaid. 3 Accounts Payable - Agnes Merchandising Purchase Returns and Allowances Issued debit memo. 6 Accounts Payable - Agnes Merchandising Cash Made partial payment. 12 Accounts Payable - Agnes Merchandising Cash Purchase Discounts Settled account in full.

60,000.00 30,000.00 30,000.00

1,000.00 1,000.00

2,000.00 2,000.00

10,000.00 10,000.00

19,000.00 18,440.00 560.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-8: Four Cases of Freight page 3 Date Particulars Sept 2 Cash Accounts Receivable Sales Sold goods on terms: 50% down, balance 2/10, n/30. 3 Sales Returns and Allowances Accounts Receivable - Rose Ladies Accessories Received debit memo. 6 Cash Accounts Receivable - Rose Ladies Accessories Received partial payment. 12 Cash Sales Discounts Accounts Receivable - Rose Ladies Accessories Collection from Customer F Debit 60,000.00 Credit 30,000.00 30,000.00

2,000.00 2,000.00

10,000.00 10,000.00

17,440.00 560.00 18,000.00

Sept

2 Cash Accounts Receivable Sales Sold goods on terms: 50% down, balance 2/10, n/30. Accounts Receivable - Rose Ladies Accessories Cash FOB Shipping Point, Prepaid. 3 Sales Returns and Allowances Accounts Receivable - Rose Ladies Accessories Received debit memo. 6 Cash Accounts Receivable - Rose Ladies Accessories Received partial payment. 12 Cash Sales Discounts Accounts Receivable - Rose Ladies Accessories Collection from Customer

60,000.00 30,000.00 30,000.00

1,000.00 1,000.00

2,000.00 2,000.00

10,000.00 10,000.00

18,440.00 560.00 19,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise
Exericse 3-9: Journalizing Merchandising Transactions with Freight and Discounts under the Periodic Inventory System

page 1 Date Particulars Aug 1 Merchandise Inventory Accounts Receivable Furniture and Fixtures Store Equipment Accounts Payable Rose Guada Marie, Capital Initial Investment. Cash Rose Guada Marie, Capital Additional Investment. 2 Store Supplies Cash Accounts Payable - Leand Marketing Terms: 20% down, 2/10, n/30. Accounts Payable - Leand Marketing Cash FOB Destination Point, Collect. 3 Purchases Accounts Payable - Erika Power Books Terms: 2/5, n/eom. Freight - In Accounts Payable - Erika Power Books FOB Shipping Point, Prepaid. 4 Accounts Payable - Leand Marketing Store Supplies Received credit memo. 5 Accounts Payable - Erika Power Books Cash Made partial payment. 6 Cash Sales Sold goods. Freight - Out Cash FOB Destination Point, Collect. F Debit 125,000.00 12,000.00 94,000.00 20,000.00 Credit

37,000.00 214,000.00

10,000.00 10,000.00

9,000.00 1,800.00 7,200.00

500.00 500.00

76,000.00 76,000.00

350.00 350.00

1,000.00 1,000.00

20,000.00 20,000.00

20,000.00 20,000.00

700.00 700.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-4:Purchase and Sale of Merchandise with Returns and Partial Payments page 2 Date Particulars June 8 Accounts Receivable - Rose Daycare Center Sales Sold computer at 50% above cost. 9 Sales Returns and Allowances Accounts Receivable - Rose Daycare Center Granted allowance. 12 Cash Accounts Receivable - Rose Daycare Center Received partial payment of account. 25 Cash Accounts Receivable - Rose Daycare Center Collection from customer. Mar 1 Purchases Cash Accounts Payable - RGM Trading Terms: 50% down, balance on account. 2 Accounts Payable - RGM Trading Purchase Returns and Allowances Returned Merchandise. 5 Accounts Payable - RGM Trading Cash Made partial payment. 11 Accounts Payable - RGM Trading Guada, Capital Paid account using personal check of the owner, Guada. F Debit 75,000.00 Credit 75,000.00

1,500.00 1,500.00

20,000.00 20,000.00

53,500.00 53,500.00

20,000.00 10,000.00 10,000.00

300.00 300.00

5,000.00 5,000.00

4,700.00 4,700.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-5: Purchase and Sale of Merchandise with Trade and Cash Discounts page 2 Date July 20 Cash Sales Sold merchandise. Cost of Goods Sold Merchandise Inventory Cost of Merchandise sold. 22 Cash Sales Discount Accounts Receivable - Maffy's Merchandising Collection from customer. 30 Cash Accounts Receivable - Leand Department Store Sales Terms: 25% down, balance 2/10, n/30. Cost of Goods Sold Merchandise Inventory Cost of Merchandise Sold. Particulars F Debit 93,000.00 Credit 93,000.00

45,000.00 45,000.00

25,871.10 527.90 26,395.00

37,500.00 112,500.00 150,000.00

100,000.00 100,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-5: Purchase and Sale of Merchandise with Trade and Cash Discounts page 4 Date July 20 Cash Sales Sold merchandise. Particulars F Debit 93,000.00 Credit 93,000.00

22 Cash Sales Discount Accounts Receivable - Maffy's Merchandising Collection from customer. 30 Cash Accounts Receivable - Leand Department Store Sales Terms: 25% down, balance 2/10, n/30.

25,871.10 527.90 26,395.00

37,500.00 112,500.00 150,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-6: Journalizing Merchandising Transactions page 2 Date Particulars May 20 Cash Sales Discount Accounts Receivable - Judielle Boutique Collection from customer. 22 Cash Sales Sold goods. Cost of Goods Sold Merchandise Inventory Cost of Merchandise sold. 23 Sales Returns and Allowances Cash Customer returned goods. Merchandise Inventory Cost of Goods Sold Cost of Merchandise returned. 25 Accounts Receivable - Cherubim Bags and Accessories Sales Terms: 2/10, 1/15, n/30. Cost of Goods Sold Merchandise Inventory Cost of Merchandise sold. 25 Freight - Out Cash Paid freight. 31 Accounts Payable - Legion Trading Cash Merchandise Inventory Paid account in full. F Debit 7,128.00 72.00 Credit

7,200.00

26,250.00 26,250.00

22,500.00 22,500.00

700.00 700.00

600.00 600.00

16,000.00 16,000.00

12,000.00 12,000.00

300.00 300.00

22,500.00 22,050.00 450.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-6: Journalizing Merchandising Transactions page 4 Date May 22 Cash Sales Sold goods. Particulars F Debit 26,250.00 Credit 26,250.00

23 Sales Returns and Allowances Cash Customer returned goods. 25 Accounts Receivable - Cherubim Bags and Accessories Sales Terms: 2/10, 1/15, n/30. 25 Freight - Out Cash Paid freight. 31 Accounts Payable - Legion Trading Cash Purchase Discount Paid account in full.

700.00 700.00

16,000.00 16,000.00

300.00 300.00

22,500.00 22,050.00 450.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-8: Four Cases of Freight page 2 Date Particulars Sept 2 Purchases Cash Accounts Payable - Agnes Merchandising Purchased goods on terms: 50% down, balance 2/10, n/30. Accounts Payable - Agnes Merchandising Cash FOB Destination Point, Collect. 3 Accounts Payable - Agnes Merchandising Purchase Returns and Allowances Issued debit memo. 6 Accounts Payable - Agnes Merchandising Cash Made partial payment. 12 Accounts Payable - Agnes Merchandising Cash Purchase Discounts Settled account in full. F Debit 60,000.00 Credit 30,000.00 30,000.00

1,000.00 1,000.00

2,000.00 2,000.00

10,000.00 10,000.00

17,000.00 16,440.00 560.00

Sept

2 Purchases Cash Accounts Payable - Agnes Merchandising Purchased goods on terms: 50% down, balance 2/10, n/30. 3 Accounts Payable - Agnes Merchandising Purchase Returns and Allowances Issued debit memo. 6 Accounts Payable - Agnes Merchandising Cash Made partial payment. 12 Accounts Payable - Agnes Merchandising Cash Purchase Discounts Settled account in full.

60,000.00 30,000.00 30,000.00

2,000.00 2,000.00

10,000.00 10,000.00

18,000.00 17,440.00 560.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-8: Four Cases of Freight page 4 Date Particulars Sept 2 Cash Accounts Receivable Sales Sold goods on terms: 50% down, balance 2/10, n/30. Freight - Out Accounts Receivable - Rose Ladies Accessories FOB Destination Point, Collect. 3 Sales Returns and Allowances Accounts Receivable - Rose Ladies Accessories Received debit memo. 6 Cash Accounts Receivable - Rose Ladies Accessories Received partial payment. 12 Cash Sales Discounts Accounts Receivable - Rose Ladies Accessories Collection from Customer F Debit 60,000.00 Credit 30,000.00 30,000.00

1,000.00 1,000.00

2,000.00 2,000.00

10,000.00 10,000.00

16,440.00 560.00 17,000.00

Sept

2 Cash Accounts Receivable Sales Sold goods on terms: 50% down, balance 2/10, n/30. Freight - Out Cash FOB Destination Point, Prepaid. 3 Sales Returns and Allowances Accounts Receivable - Rose Ladies Accessories Received debit memo. 6 Cash Accounts Receivable - Rose Ladies Accessories Received partial payment. 12 Cash Sales Discounts Accounts Receivable - Rose Ladies Accessories Collection from Customer

60,000.00 30,000.00 30,000.00

1,000.00 1,000.00

2,000.00 2,000.00

10,000.00 10,000.00

17,440.00 560.00 18,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise
Exericse 3-9: Journalizing Merchandising Transactions with Freight and Discounts under the Periodic Inventory System

page 2 Date Particulars Aug 7 Cash Accounts Receivable - Faith Christian School Sales Terms: 50% down, balance 2/10, n/30. Accounts Receivable - Faith Christian School Cash FOB Shipping Point, Prepaid. 8 Accounts Payable - Erika Power Books Cash Purchase Discount Settled account in full. 11 Accounts Payable - Leand Marketing Cash Store Supplies Settled account in full. 12 Sales Returns and Allowances Cash Customer returned goods. 14 Accounts Receivable - Oliver Bookstore Sales Terms: 2/10, n/30. 17 Cash Sales Discount Accounts Receivable - Faith Christian School Collection from customer. 24 Purchases Accounts Payable - Bulacan Publishing Terms: 2/10, n/30. F Debit 25,000.00 25,000.00 Credit

50,000.00

1,800.00 1,000.00

56,350.00 54,830.00 1,520.00

5,700.00 5,576.00 124.00

300.00 300.00

10,000.00 10,000.00

26,300.00 500.00 26,800.00

45,000.00 45,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-10: Value Added Tax (VAT) on Merchandise Purchased page 1 Date July 1 Purchases Input Tax Cash Purchased goods. Particulars F Debit 40,000.00 4,800.00 Credit

44,800.00

4 Purchases Input Tax Accounts Payable - Romy Trading Terms: 2/10, n/30. 7 Cash Purchase Returns and Allowances Input Tax Returned defective goods. 9 Store Equipment Input Tax Cash Bought a cash register. 12 Store Supplies Input Tax Accounts Payable - Guadalupe Mart Terms: 2/10, n/30. 14 Accounts Payable - Romy Trading Cash Purchase Discount Input Tax Settled account in full. 16 Accounts Payable - Guadalupe Mart Store Supplies Input Tax Returned store supplies. 20 Office Equipment Input Tax Accounts Payable - Dell Inc. Purchased Office Equipment 22 Accounts Payable - Guadalupe Mart Store Supplies Input Tax Cash Settled account in full.

80,000.00 9,600.00 89,600.00

1,680.00 1,500.00 180.00

30,000.00 3,600.00 33,600.00

4,000.00 480.00 4,480.00

89,600.00 87,808.00 1,600.00 192.00

224.00 200.00 24.00

70,000.00 8,400.00 78,400.00

4,256.00 76.00 9.12 4,170.88

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-11: Value Added Tax (VAT) on Merchandise Purchased and Sold page 1 Date Particulars Sept 1 Purchases Input Tax Accounts Payable - Rose Trading Terms: 2/10, n/30. 4 Accounts Receivable - Victoria Mart Sales Output Tax Terms: 2/10, n/30. 5 Store Furniture and Fixtures Input Tax Cash Purchased additional store shelves and cabinet. 8 Cash Sales Output Tax Cash sales from Sept. 1 to 8. 9 Sales Returns and Allowances Output Tax Accounts Receivable - Victoria Mart Issued credit memo. 10 Sales Returns and Allowances Output Tax Cash Refunded cash customer for goods returned. 11 Accounts Payable - Rose Trading Purchase Discount Input Tax Cash Settled account in full. 14 Cash Sales Discount Output Tax Accounts Receivable - Victoria Mart Collection from Customer 18 Cash Sales Output Tax Sold goods. F Debit 81,000.00 9,720.00 Credit

90,720.00

89,600.00 80,000.00 9,600.00

10,000.00 1,200.00 11,200.00

84,896.00 75,800.00 9,096.00

2,000.00 240.00 2,240.00

500.00 60.00 560.00

90,720.00 1,620.00 194.40 88,905.60

85,612.80 1,560.00 187.20 87,360.00

28,000.00 25,000.00 3,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Additional Exercise on Value Added Tax (VAT) on Merchandise Purchased and Sold page 1 Date Particulars Jan 1 Purchases Input Tax Accounts Payable - Purefoods Co. Terms: 2/10, n/30, VAT inclusive. 3 Accounts Receivable - Cebu Coop Sales Output Tax Terms: 1/15, n/30, VAT inclusive. 5 Accounts Payable - Purefoods Co. Purchase Returns and Allowances Input Tax Issued debit memorandum. 7 Store Furniture and Fixtures Input Tax Cash Purchased store racks and shelves, plus 12% VAT. 8 Purchases Input Tax Cash Accounts Payable - URC Co. Terms: 10% down, balance 2/10, n/30 VAT inclusive. 9 Sales Returns and Allowances Output Tax Accounts Receivable - Cebu Coop Received debit memorandum. 10 Cash Sales Output Tax Cash sales from January 1 to 10. 11 Accounts Payable - Purefoods Co. Purchase Discounts Input Tax Cash Settled account in full. 15 Purchases Input Tax Cash Cash purchases from Swift Inc. F Debit 90,000.00 10,800.00 Credit

100,800.00

56,000.00 50,000.00 6,000.00

2,268.00 2,025.00 243.00

15,000.00 1,800.00 16,800.00

30,000.00 3,600.00 3,360.00 30,240.00

800.00 96.00 896.00

78,400.00 70,000.00 8,400.00

98,532.00 1,759.50 211.14 96,561.36

25,000.00 3,000.00 28,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Additional Exercise on Value Added Tax (VAT) on Merchandise Purchased and Sold page 3 Date Jan 30 Output Tax Input Tax Cash Remittance to BIR. Particulars F Debit 39,012.96 Credit 27,681.06 11,331.90

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-10: Value Added Tax (VAT) on Merchandise Purchased page 2 Date Particulars July 31 Purchases Input Tax Cash Accounts Payable - Joseph Marketing Terms for the balance: 2/10, n/30. F Debit 12,000.00 1,440.00 Credit

5,000.00 8,440.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-11: Value Added Tax (VAT) on Merchandise Purchased and Sold page 2 Date Sept 20 Purchases Input Tax Cash Cash purchases, Particulars F Debit 20,000.00 2,400.00 Credit

22,400.00

25 Cash Accounts Receivable - Babes Daycare Center Sales Output Tax Terms on balance: 2/10, n/30. 30 Output Tax Input Tax Cash Remittance to BIR.

10,000.00 34,800.00 40,000.00 4,800.00

26,008.80 13,125.60 12,883.20

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Additional Exercise on Value Added Tax (VAT) on Merchandise Purchased and Sold page 2 Date Jan 15 Freight In Cash Paid freight. Particulars F Debit 700.00 Credit 700.00

17 Cash Sales Discount Output Tax Accounts Receivable - Cebu Coop Collection from customer. 18 Accounts Payable - URC Co. Purchase Discount Input Tax Cash Settled account in full. 20 Cash Sales Output Tax Cash sales from January 11 to 20. 25 Purchases Input Tax Cash Accounts Payable - Sari-sair Hypermart Terms: 2/10eom, n/45, VAT Inclusive. 26 Accounts Receivable Sales Output Tax Terms: 2/10, n/30. Accounts Receivable Cash FOB Shipping Point, Prepaid. 27 Sales Returns and Allowances Output Tax Cash Refunded cash customer for goods returned. 30 Cash Sales Output Tax Cash sales from January 21 to 30.

54,552.96 492.00 59.04 55,104.00

30,240.00 540.00 64.80 29,635.20

89,600.00 80,000.00 9,600.00

75,000.00 9,000.00 35,000.00 49,000.00

50,400.00 45,000.00 5,400.00

1,000.00 1,000.00

600.00 72.00 672.00

91,840.00 82,000.00 9,840.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-15: Property Plant and Equipment Date April Land 350,000.00 4,500.00 3,000.00 Real Estate Tax Expense 20,000.00 10,000.00 (15,000.00) 250,000.00 369,500.00 315,000.00 3,000.00 40,000.00 Building 25,000.00 Other Accounts Account Titles

May July TOTALS

4 8 10 15 17 24 28 1 31

March

July

March

May

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-16: Journalizing page 1 Date Particulars CASE A June 7 Office Equipment Accounts Payable - Francis Computer Sales Bought computer. Office Equipment Cash F.O.B. Shipping Point, Collect 9 Accounts Payable - Francis Computer Sales Office Equipment Received credit memo. 12 Accounts Payable - Francis Computer Sales Cash Made partial payment. 25 Accounts Payable - Francis Computer Sales Discounts Lost Cash Full payment of account. CASE B May 1 Store Equipment Cash Accounts Payable - Omron Sales, Inc. Bought cash register. Store Equipment Cash F.O.B. Shipping Point, Collect. 3 Accounts Payable - Omron Sales, Inc. Store Equipment Received credit memo. 11 Accounts Payable - Omron Sales, Inc. Cash Full payment of account. F Debit 35,280.00 44,800.00 Credit

750.00 750.00

980.00 980.00

5,000.00 5,000.00

29,300.00 700.00 30,000.00

53,320.00 20,000.00 33,320.00

2,500.00 2,500.00

1,372.00 1,372.00

31,948.00 31,948.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-16: Journalizing page 2 Date Particulars CASE C March 1 Office Furniture and Fixtures Cash Accounts Payable - Rose Furniture Shop Bought office tables and chairs. Office Furniture and Fixtures Cash Paid freight. 3 Accounts Payable - Rose Furniture Shop Office Furniture and Fixtures Allowance granted. 20 Accounts Payable - Rose Furniture Shop Discounts Lost Cash Full payment of account. July 31 Cash Accumulated Depreciation - Office Furniture and Fixtures Loss on Sale of Property Office Furniture and Fixtures Sold office tables and chairs. F Debit 46,950.00 20,000.00 26,950.00 Credit

2,500.00 2,500.00

1,274.00 1,274.00

25,676.00 524.00 26,200.00

15,000.00 30,000.00 3,176.00 48,176.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-17: Computations of Plant Assets Cost and Gain or Loss on Disposal through Sale

CASE A List Price Trade Discounts (P400,000 x 10%) Trade Discounts (P360,000 x 5%) Trade Discounts (P342,000 x 2%) Invoice Price Purchase Discount (P335,160 x 2%) Freight Cost Customs Duties Insurance while in Transit Installation Materials and Labor Cost of Labor and Materials for Testing the Equipment Equipment

400,000.00 (40,000.00) (18,000.00) (6,840.00) 335,160.00 (6,703.20) 12,000.00 7,000.00 5,200.00 2,500.00 900.00

328,456.80

27,600.00 356,056.80

CASE B Date 20X7 March 11 Office Equipment Cash Accounts Payable Bought computer. Office Equipment Cash Paid freight. Accounts Payable Office Equipment Allowance granted. 20 Accounts Payable Cash Full payment of account.

Particulars

Debit 35,480.00

Credit

10,000.00 25,480.00

800.00 800.00

490.00 490.00

24,990.00 24,990.00

20X9 May 31 Cash Accumulated Depreciation - Office Equipment Office Equipment Gain on Sale of Property Sold office equipment.

25,000.00 18,500.00 35,790.00 7,710.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Additional Exercises on Property, Plant and Equipment

1a Cash Payment Accounts Payable Insurance while in Transit Freight Special Foundation Fee paid to factory representative for installation Equipment 1b Purchase Price Freight Installation Necessary repair or wreckage during installation Replacement of worn-out parts Fees paid to attorney to review purchase agreement Equipment 2 Invoice price Purchase discount Add: Transportation - In Installation Costs Testing Costs prior to regular operation Acquisition Cost 3a Land Legal Fees Land Survey Landfill for Building Site Cost of the Land 3b Architect's Fees Construction Costs Engineer's Fees Excavation of Basement Cost of the Building 80,000.00 (1,600.00) 1,200.00 700.00 550.00

100,000.00 396,000.00 12,000.00 4,000.00 15,000.00 5,000.00 532,000.00 200,000.00 3,000.00 5,000.00 11,000.00 35,000.00 5,000.00 259,000.00

78,400.00

2,450.00 80,850.00
3,200,000.00

41,000.00 96,000.00 140,000.00 3,477,000.00 210,000.00

9,500,000.00

193,000.00 290,000.00 10,193,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-18:Preparation of Functional Form Income Statement MAYA TRADING INCOME STATEMENT For the Year Ended December 31, 20X7

Net Sales Cost of Goods Sold Gross Profit Interest Income Total Income Expenses Distribution Expenses Administrative Expenses Interest Expense Net Income

Note 1 Note 2

P 749,104.00 (467,510.00) P 281,594.00 6,960.00 P 288,554.00

Note 3 Note 4

P 112,672.00 151,018.00 8,362.00

(272,052.00) P 16,502.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-18:Preparation of Functional Form Income Statement Notes to the Financial Statements Note 1 - Net Sales Sales Less: Sales Discounts Less: Sales Returns and Allowances Net Sales Note 2 - Cost of Goods Sold Merchandise Inventory, January 1 Add: Net Cost of Purchases Add: Purchases Add: Less: Purchase Discounts Add: Less: Purchase Returns and Allowances Add: Net Purchases Add: Add: Freight - In Cost of Goods Available for Sale Less: Merchandise Inventory, December 31 Cost of Goods Sold Note 3 - Distribution Expenses Sales Salaries Advertising Expense Representation Expense Salesmens' Commission Gasoline and Lubrication - Distribution Freight-Out Total Distribution Expenses Note 4 - Administrative Expenses Office Salaries Light and Water Office Supplies Expense Rent Expense Depreciation Expense Communication Expense Repairs and Maintenance Total Administrative Expenses

P 766,200.00 P 10,000.00 7,096.00 (17,096.00) P 749,104.00

P 123,450.00 P 484,836.00 P 5,440.00 9,168.00 (14,608.00) P 470,228.00 8,392.00

478,620.00 P 602,070.00 (134,560.00) P 467,510.00

P 40,696.00 25,320.00 18,200.00 12,100.00 9,300.00 7,056.00 P 112,672.00

P 62,200.00 45,568.00 14,160.00 10,000.00 9,820.00 5,420.00 3,850.00 P 151,018.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-25: Special and General Journals SALES JOURNAL Date Jun 3 HORR. C. 9 P.G. Customer Terms 2/15, 1/eom, n/45 Page 1 Sales (Cr) Accounts Receivable Debit P 17,000.00 18,800.00 P 35,800.00 102 501 PURCHASES JOURNAL Date Jun 1 D. RAGON Customer Terms 2/10, n/60 Page 1 Sales (Cr) Accounts Receivable Debit P 21,340.00 P 21,340.00 301 601

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-25: Special and General Journals GENERAL JOURNAL Page 1 Date Particulars Jun 1 Freight - In Accounts Payable - D.RAGON FOB SP, Prepaid. Accounts Payable - D.RAGON Purchase Returns and Allowances Issued debit memo. 4 Office Supplies Accounts Payable - MON KEE Terms: 1/10, n/25. 7 Sales Returns and Allowances Accounts Receivable - OX Issued credit memo. 22 Accounts Payable - ROBBY T. Store Furniture and Fixtures Issued debit memo. F 604 301 Debit 600.00 Credit 600.00

301 603

1,500.00 1,500.00

104 301

4,000.00 4,000.00

503 102

2,000.00 2,000.00

301 201

1,960.00 1,960.00

Jun

Jun

Jun

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-25: Special and General Journals CUSTOMER NAME: HORR. C. Date Terms Jun 3 2/15, 1/eom, n/45 8 Partial Collection 18 Full Collection

F Debit SJ-1 P 17,000.00 CRJ - 1 CRJ - 1

Credit P 8,500.00 8,500.00

Balance P 17,000.00 8,500.00 0.00

CUSTOMER NAME: P.G. Date Jun 9 2/10, n/30

Terms

F SJ-1

Debit P 18,800.00

Credit

Balance P 18,800.00

CUSTOMER NAME: OX Date Terms Jun 6 2/15, 1/eom, n/45 7 Partial Collection

F Debit CRJ - 1 P 5,378.24 GJ - 1

Credit P 2,000.00

Balance P 5,378.24 3,378.24

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-25: Special and General Journals SUPPLIER NAME: D.RAGON. Date Terms Jun 1 2/10, n/60 1 Freight 2 Debit Memorandum 30 Partial Payment

F PJ - 1 GJ - 1 GJ - 1 CPJ - 1

Debit

Credit P 21,340.00 600.00

P 1,500.00 10,220.00 .

Balance P 21,340.00 21,940.00 20,440.00 10,220.00

SUPPLIER NAME: R. ATT Date Jun 1 2/10, n/30

Terms

F CPJ - 1

Debit

Credit P 4,600.00

Balance P 4,600.00

SUPPLIER NAME: MON KEE Date Terms Jun 4 1/10, n/25 14 Full Payment

F GJ - 1 CPJ - 1

Debit P 4,000.00

Credit P 4,000.00

Balance P 4,000.00 0.00

SUPPLIER NAME: ROBBY T. (Display Cabinet) Date Terms Jun 21 2/5, n/20 22 Debit Memorandum 26 Full Payment

F CPJ - 1 GJ - 1 CPJ - 1

Debit P 1,960.00 9,564.80

Credit P 11,524.80

Balance P 11,524.80 9,564.80 0.00

Jun

Jun

Jun

Jun

Jun

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-25: Special and General Journals CASH Debit P 50,738.24 P 133.44 101 Credit P 50,604.80

Date Jun 30

Particulars

F
CRJ1

Date Jun 30

Particulars

F
CPJ1

Jun 30 Balance

Date Jun 30 30

Particulars

F
SJ1 CRJ1

ACCOUNTS RECEIVABLE Date Debit P 35,800.00 Jun 7 5,378.00 30 P 22,178.24

Particulars

F
GJ1 CRJ1

102 Credit P 2,000.00 17,000.00

Jun 30 Balance

Date Jun 4

Particulars

F
GJ1

OFFICE SUPPLIES Date Debit P 4,000.00 Jun 14 P 3,960.00

104 Particulars F
CPJ1 P

Credit 40.00

Jun 30 Balance

Date Jun 21

Particulars

FURNITURE AND FIXTURES Date Debit CPJ1 P 23,284.80 Jun 22 F P 21,324.80

Particulars

F
GJ1

201 Credit P 1,960.00

Jun 30 Balance

Date Jun 29

Particulars

ACCUMULATED DEPRECIATION - EQUIPMENT Date F Debit Particulars CRJ1 P 21,500.00 P 21,500.00

202 F Credit

30 Balance

Date

Particulars

EQUIPMENT Date Debit Jun 29

Particulars

F
CRJ1

202 Credit P 55,000.00 P 55,000.00

30 Balance

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-25: Special and General Journals ACCOUNTS PAYABLE Date Debit P 1,500.00 Jun 1 1,960.00 4 23,784.80 30 30 301 Credit GJ1 P 600.00 GJ1 4,000.00 PJ1 21,340.00 CPJ1 16,124.80 F P 14,820.00

Date Jun 2 22 30

Particulars

F
GJ1 GJ1 CPJ1

Particulars

30 Balance

Date Jun 11

Particulars

F
CPJ1

ZOE, DRAWING Date Debit P 14,000.00 P 14,000.00

402 Particulars F Credit

30 Balance

SALES Date Particulars F Debit Date Jun 30 30 Particulars F

SJ1 CRJ1

501 Credit P 35,800.00 10,756.48 P 46,556.48

Jun 30 Balance

Date Jun 30

Particulars

F
CRJ1

SALES DISCOUNTS Date Debit P 340.00 P 340.00

502 Particulars F Credit

30 Balance

Date Jun 7

Particulars

SALES RETURNS AND ALLOWANCES Date F Debit Particulars GJ1 P 2,000.00 P 2,000.00

502 F Credit

30 Balance

Date Jun 30 30

Particulars

F
PJ1 CPJ1

PURCHASES Date Debit P 21,340.00 Jun 11 9,200.00 P 26,540.00

601 Particulars F
CPJ1

Credit P 4,000.00

Jun 30 Balance

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-25: Special and General Journals PURCHASE RETURNS AND ALLOWANCES Date F Debit Particulars Jun 2 Jun 30 Balance 603 Credit P 1,500.00 P 1,500.00

Date

Particulars

F
GJ1

Date Jun 1

Particulars

F
GJ1

FREIGHT - IN Date Debit P 600.00 P 600.00

604 Particulars F Credit

30 Balance

Date Jun 3

Particulars

FREIGHT - OUT Date Debit CPJ1 P 500.00 F P 500.00

605 Particulars F Credit

30 Balance

Date Jun 29

Particulars

LOSS ON SALE OF PROPERTY Date F Debit CRJ1 P 4,800.00 P 4,800.00

606 Particulars F Credit

30 Balance

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-27: Petty Cash Fund DATE Dec 1 2 8 15 23 30 EXPLANATION Establishment Purchased supplies Repair of machine Gasoline and Lubrication Messenger's Fares IOU of employee
PCV

110 111 112 113 114

PETTY CASH BOOK PETTY CASH FUND DISTRIBUTION OF PAYMENTS Disbursements Supplies Expense Transporation Expense Repairs and Maintenance Expense Receipts Sundry Account 2,000.00 500.00 500.00 400.00 400.00 600.00 Gas & Oil Expense 100.00 100.00 200.00 Advances to Employees 2,000.00 1,800.00 500.00 100.00 400.00

Amount

600.00 200.00 800.00

Balance of Fund 31 Replenishment

200.00 1,800.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-27: Petty Cash Fund CASH PAYMENTS JOURNAL Page 1 DATE Dec PAID TO 1 Petty Cash Fund 31 Petty Cash Fund CASH Credit 2,000.00 1,800.00
PURCHASE D.

Credit

ACCOUNTS PAYABLE Debit Credit

Purchases Credit

SUNDRY Account Titles Petty Cash Fund Supplies Expense Transporation Expense Repairs and Maintenance Expense Gasoline and Oil Expense Advances to Employees F Debit 2,000.00 500.00 400.00 600.00 100.00 200.00 3,800.00 Credit

Balance

3,800.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-30: Accrued Revenues page 1 Date Particulars May 31 Accrued Interest Income Interest Income To accrue for interest income. 31 Accrued Interest Income Interest Income To accrue for interest income. 31 Accrued Commission Income Commission Income To accrue for sales commission. 31 Accrued Rent Income Rent Income To accrue for rent income. 31 Accrued Interest Income Interest Income To accrue for interest income. F Debit 341.43 Credit 341.43

786.25 786.25

8,690.40 8,690.40

9,000.00 9,000.00

987.73 987.73

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-31: Accrued Expenses page 1 Date Particulars June 30 Rent Expense Accrued Rent Expense To accrue for rent expense. 30 Salaries Expense Accrued Salaries Expense SSS Premiums Payable Philhealth Premiums Payable Withholding Taxes Payable To accrue for salaries expense. 30 Utilities Expense Accrued Utilities Expense To accrue for utilities expense. 30 Advertising Expense Accrued Advertising Expense To accrue for advertising expense. 30 Interest Expense Accrued Interest Expense To accrue for interest expense. F Debit 120,000.00 Credit 120,000.00

241,500.00 202,860.00 12,075.00 2,415.00 24,150.00

19,103.75 19,103.75

7,500.00 7,500.00

7,623.13 7,623.13

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-32: Accruals page 1 Date Particulars Dec 31 Accrued Interest Income Interest Income To accrue for interest income. 31 Interest Expense Accrued Interest Expense To accrue for interest expense. 31 Taxes Expense Accrued Taxes Expense To accrue for tax expense. 31 Accrued Rent Income Rent Income To accrue for rent income. 31 Commissions Expense Accrued Commissions Expense To accrue for commissions expense. F Debit 98.00 Credit 98.00

2,137.78 2,137.78

4,560.00 4,560.00

2,420.00 2,420.00

250.00 250.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-33: Prepaid Expenses page 1 Date Particulars June 30 Prepaid Subscription Subscription Expense To adjust for the unused portion of subscription expense. Mar 31 Rent Expense Prepaid Rent To adjust for the used portion of prepaid rent. Aug 31 Prepaid Advertising Advertising Expense To adjust for the unused portion of advertising expense. Dec 31 Supplies Expense Office Supplies To adjust for the used portion of office supplies. F Debit 5,400.00 Credit 5,400.00

100,000.00 100,000.00

22,500.00 22,500.00

19,471.20 19,471.20

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-34: Unearned Revenue page 1 Date Particulars June 30 Unearned Rent Income Rent Income To adjust for the earned portion of unearned rent income. Sept 30 Unearned Commissions Sales Commissions Income To adjust for the earned portion of unearned commissions. May 31 Interest Income Unearned Interest Income To adjust for the unearned portion of interest income. April 30 Unearned Rent Income Rent Income To adjust for the earned portion of unearned rent income. F Debit 288,000.00 Credit 288,000.00

10,388.40 10,388.40

469.08 469.08

440,000.00 440,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-35: Amortization of Discount page 1 Date Particulars June 30 Interest Expense Discount on Notes Payable To amortize own discounted note. 30 Interest Expense Discount on Notes Payable To amortize own discounted note. F Debit 267.00 Credit 267.00

1,673.44 1,673.44

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-36: Accruals, Deferrals and Amortization of Discount page 1 Date Particulars Dec 31 Rent Expense Prepaid Rent To adjust for the used portion of prepaid rent. 31 Prepaid Interest Interest Expense To adjust for the used portion of interest expense. 31 Interest Expense Discount on Notes Payable To amortize notes payable. 31 Unearned Commissions Sales Commissions Income To adjust for the earned portion of unearned commissions. 31 Accrued Interest Income Interest Income To accrue for interest income. 31 Salaries Expense Accrued Salaries Expense To accrue for salaries expense. 31 Interest Income Unearned Interest Income To adjust for the unearnede portion of interest income. F Debit 240,000.00 Credit 240,000.00

353.63 353.63

72.22 72.22

83,000.00 83,000.00

50.00 50.00

18,400.00 18,400.00

318.89 318.89

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-37: Depreciation Expense page 1 Date Particulars Dec 31 Depreciation Expense - Office Equipment Accumulated Depreciation - Office Equipment To record depreciation. 31 Depreciation Expense - Office Furniture A Accumulated Depreciation - Office Furniture A To record depreciation. 31 Depreciation Expense - Office Furniture B Accumulated Depreciation - Office Furniture B To record depreciation. 31 Depreciation Expense - Office Furniture Accumulated Depreciation - Office Furniture To record depreciation. F Debit 2,985.53 Credit 2,985.53

7,928.57 7,928.57

2,385.00 2,385.00

872.83 872.83

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-37: Depreciation Expense

CASE A 1 Purchase Price (P56200 - 5620) Cash Discount (P50580 x 0.02) Office Computer Scrap Value Estimated Useful Life Annual Depreciation x Fractional Year Accumulated Depreciation - December 31, 20X9 Office Computer Accumulated Depreciation - December 31, 20X9 Carrying Value CASE B 1 Purchase Price Cash Discount (P12600 2 x 0.02) Office Cabinet Scrap Value Estimated Useful Life Annual Depreciation x Fractional Year Accumulated Depreciation - Office Cabinet 2 Office Furniture A Scrap Value Estimated Useful Life Annual Depreciation x Fractional Year Accumulated Depreciation - Office Furniture A 3 Office Furniture B Scrap Value Estimated Useful Life Annual Depreciation x Fractional Year Accumulated Depreciation - Office Furniture B 4 Office Furniture A Accumulated Depreciation - Office Furniture A Office Furniture B Accumulated Depreciation - Office Furniture B Office Cabinet Accumulated Depreciation - Office Cabinet Carrying Value

50,580.00 (1,011.60) 49,568.40 (1,800.00)

47,768.40 4 11,942.10 x 3/12 2,985.53 49,568.40 (2,985.53) 46,582.87

12,600.00 (126.00) 12,474.00 (2,000.00)

10,474.00 5 2,094.80 x 5/12 872.83

60,000.00 (4,500.00)

55,500.00 7 7,928.57 x 33.5/12 22,133.93

26,950.00 (3,100.00)

23,850.00 10 2,385.00 x 32/12 6,360.00

60,000.00 (22,133.93) 26,950.00 (6,360.00) 12,474.00 (872.83)

37,866.07 20,590.00 11,601.17 70,057.24

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-38: Depreciation Expense page 1 Date Particulars 20X9 Dec 31 Depreciation Expense - Office Furniture Accumulated Depreciation Expense - Office Furniture To record depreciation. Depreciation Expense - Delivery Equipment Accumulated Depreciation - Delivery Equipment To record depreciation. Depreciation Expense - Office Equipment Accumulated Depreciation - Office Equipment To record depreciation. 2011 Dec 31 Cash Accumulated Depreciation - Office Furniture Gain on Sale of Property Office Furniture Sold property. F Debit 26,640.00 26,640.00 Credit

25,375.00 25,375.00

27,011.67 27,011.67

40,000.00 79,320.00 60,740.00 58,580.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-38: Depreciation Expense

1 Office Furniture Scrap Value Estimated Useful Life Annual Depreciation - Office Furniture Delivery Equipment Scrap Value Estimated Useful Life Annual Depreciation - Delivery Equipment Office Equipment Scrap Value Estimated Useful Life Annual Depreciation - Office Equipment 2 Accumulated Depreciation - Office Furniture Annual Depreciation - Delivery Equipment x Fractional Year Accumulated Depreciation - Delivery Equipment Annual Depreciation - Office Equipment x Fractional Year Accumulated Depreciation - Office Equipment 3a Office Furniture Accumulated Depreciation - Office Furniture Carrying Value - December 31, 20X9 Delivery Equipment Accumulated Depreciation - Delivery Equipment Carrying Value - December 31, 20X9 Office Equipment Accumulated Depreciation - Office Equipment Carrying Value - December 31, 20X9 3b Office Furniture Accumulated Depreciation - Office Furniture (P26440 x 5) Carrying Value - End of Useful Life (Scrap Value) Carrying Value - End of Useful Life (Scrap Value - Delivery) Carrying Value - End of Useful Life (Scrap Value - Office)

137,900.00 (5,700.00)

132,200.00 5 26,440.00

654,000.00 (45,000.00)

609,000.00 10 60,900.00

87,300.00 (2,000.00)

85,300.00 5 17,060.00 26,440.00 60,900.00 5/12 25,375.00 17,060.00 19/12 27,011.67 137,900.00 (26,440.00) 111,460.00 654,000.00 (25,375.00) 628,625.00 87,300.00 (27,011.67) 60,288.33 137,900.00 (132,200.00) 5,700.00 45,000.00 2,000.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-39: Doubtful Accounts page 1 Date Particulars CASE A Sept. 30 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. 30 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. 30 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. 30 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. 30 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. 30 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. CASE B June 30 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. 30 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. 30 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. F Debit 32,174.10 32,174.10 Credit

13,500.00 13,500.00

2,500.00 2,500.00

42,874.10 42,874.10

13,500.00 13,500.00

13,200.00 13,200.00

9,008.60 9,008.60

14,908.60 14,908.60

10,128.60 10,128.60

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-39: Doubtful Accounts

CASE A Sales on Account (P567930 x 0.7) Sales Returns Cash Collection Accounts Receivable - October 1, 20X8 Accounts Receivable - September 30, 20X9 x Estimated Uncollectible Rate Allowance for Doubtful Accounts - September 30, 20X9 Allowance for Doubtful Accounts - October 1, 20X8 Doubtful Accounts Expense Accounts Receivable - September 30, 20X9 Allowance for Doubtful Accounts - September 30, 20X9 Net Realizable Value CASE B Doubtful Accounts Expense Doubtful Accounts Expense Allowance for Doubtful Accounts - October 1, 20X8 Allowance for Doubtful Accounts - September 30, 20X9 Accounts Receivable - September 30, 20X9 Allowance for Doubtful Accounts - September 30, 20X9 Net Realizable Value CASE C Allowance for Doubtful Accounts - September 30, 20X9 Allowance for Doubtful Accounts - October 1, 20X8 Doubtful Accounts Expense Allowance for Doubtful Accounts - September 30, 20X9 Accounts Receivable - September 30, 20X9 Allowance for Doubtful Accounts - September 30, 20X9 Net Realizable Value 7,850.00 (5,350.00) 2,500.00 7,850.00 375,241.00 (7,850.00) 367,391.00 13,500.00 13,500.00 5,350.00 18,850.00 375,241.00 (18,850.00) 356,391.00 403,851.00 12,760.00 158,700.00 (171,460.00) 142,850.00 375,241.00 x 10% 37,524.10 (5,350.00) 32,174.10 375,241.00 (37,524.10) 337,716.90

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-40: Doubtful Accounts

1 Accounts Receivable - Sept. 30, 20X9 (34260 - 10000 + 128000) x Estimated Uncollectible Rate Allowance for Doubtful Accounts Allowance for Doubtful Accounts, unadjusted Doubtful Accounts Expense 2 Accounts Receivable - Sept. 30, 20X9 Allowance for Doubtful Accounts Net Realizable Value 3 Allowance for Doubtful Accounts Allowance for Doubtful Accounts, unadjusted Doubtful Accounts Expense

152,260.00 x 3.5% 5,329.10 (4,075.00) 1,254.10 152,260.00 (5,329.10) 146,930.90 5,329.10 4,075.00 9,404.10

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-41: Doubtful Accounts with Write-Off and Recovery page 1 Date Cash Accounts Receivable Sales Sales during the year. Sales Returns and Allowances Accounts Receivable Sales returns made by charge customers. Cash Sales Discount Accounts Receivable Cash collection with discount. Cash Accounts Receivable Cash collection without discount. Allowance for Doubtful Accounts Accounts Receivable Accounts written-off during the year. Cash Miscellaneous Income Recovery and subsequent collection of accounts. Dec 31 Doubtful Accounts Expense Allowance for Doubtful Accounts To record allowance for doubtful accounts. Accounts Receivable - Dec. 31, 20X6 Allowance for Doubtful Accounts Net Realizable Value Particulars F Debit 206,376.00 481,544.00 Credit

687,920.00

15,744.00 15,744.00

307,720.00 6,280.00 314,000.00

22,500.00 22,500.00

10,000.00 10,000.00

3,000.00 3,000.00

14,772.00 14,772.00

222,150.00 (8,886.00) 213,264.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-42: Doubtful Accounts with Write-Off and Recovery page 1 Date Cash Accounts Receivable Sales Sales during the year. Sales Returns and Allowances Accounts Receivable Sales returns made by charge customers. Cash Sales Discount Accounts Receivable Cash collection with discount. Cash Accounts Receivable Cash collection without discount. Allowance for Doubtful Accounts Accounts Receivable Accounts written-off during the year. Cash Miscellaneous Income Recovery and subsequent collection of accounts. Dec 31 Doubtful Accounts Expense Allowance for Doubtful Accounts To record allowance for doubtful accounts. Accounts Receivable - Dec. 31, 20X6 Allowance for Doubtful Accounts Net Realizable Value Particulars F Debit 206,376.00 481,544.00 Credit

687,920.00

15,744.00 15,744.00

307,720.00 6,280.00 314,000.00

22,500.00 22,500.00

10,000.00 10,000.00

3,000.00 3,000.00

14,772.00 14,772.00

222,150.00 (8,886.00) 213,264.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-39: Doubtful Accounts

CASE D a Sales on Account (P567930 x 0.7) Sales Returns Cash Collection Accounts Receivable - October 1, 20X8 Accounts Receivable - September 30, 20X9 x Estimated Uncollectible Rate Allowance for Doubtful Accounts - September 30, 20X9 Allowance for Doubtful Accounts - October 1, 20X8 Doubtful Accounts Expense Accounts Receivable - September 30, 20X9 Allowance for Doubtful Accounts - September 30, 20X9 Net Realizable Value

403,851.00 12,760.00 158,700.00 (171,460.00) 142,850.00 375,241.00 x 10% 37,524.10 5,350.00 42,874.10 375,241.00 (37,524.10) 337,716.90

b Doubtful Accounts Expense Doubtful Accounts Expense Allowance for Doubtful Accounts - October 1, 20X8 Allowance for Doubtful Accounts - September 30, 20X9 Accounts Receivable - September 30, 20X9 Allowance for Doubtful Accounts - September 30, 20X9 Net Realizable Value

13,500.00 13,500.00 (5,350.00) 8,150.00 375,241.00 (8,150.00) 367,091.00

c Allowance for Doubtful Accounts - September 30, 20X9 Allowance for Doubtful Accounts - October 1, 20X8 Doubtful Accounts Expense Allowance for Doubtful Accounts - September 30, 20X9 Accounts Receivable - September 30, 20X9 Allowance for Doubtful Accounts - September 30, 20X9 Net Realizable Value

7,850.00 5,350.00 13,200.00 7,850.00 375,241.00 (7,850.00) 367,391.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-43: Comprehensive Exercises

1 Interest Income, beginning x Discount Period Interest Income, end 2 Supplies on Hand, beginning Additional Supplies Supplies on Hand, end Supplies Expense 3 Downpayments Notes Receivable [(P25,000 x 0.98) - P10,000] Interest Income (P14,500 x 0.12 x 18/360) Net Income 4 Cost (P150,000 x 0.95 x 0.98) Installation Cost Freight Machinery Salvage Value Estimated Useful Life Annual Depreciation x Fractional Years Used Accumulated Depreciation - Machinery Machinery Accumulated Depreciation - Machinery Carrying Value 5 Merchandise Inventory, beginning Net Cost of Purchases Cost of Sales Merchandise Inventory, end 6 Accounts Receivable [P12,300 + (P887,500 x 0.30)] Allowance for Doubtful Accounts (P278,550 x 0.05) Net Realizable Value 139,650.00 3,000.00 2,000.00 144,650.00 (10,000.00)

2,500.00 30/45 1,666.67 2,000.00 3,000.00 (1,400.00) 3,600.00 10,000.00 14,500.00 87.00 24,587.00

134,650.00 10 13,465.00 x 31/12 34,784.58 144,650.00 (34,784.58) 109,865.42 31,000.00 987,000.00 (896,000.00) 122,000.00 278,550.00 (13,927.50) 264,622.50

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-46: Problem Solving

1 CASE A Cash Balance per Bank Statement, unadjusted Deposits in Transit Outstanding Checks Correct Cash Balance Cash Balance per Ledger, unadjusted Bank Service Charge Note Collection by Bank Correct Cash Balance CASE B Correct Cash Balance Outstanding Checks Deposits in Transit Cash Balance per Bank Statement, unadjusted CASE C Correct Cash Balance Bank Service Charge Note Collection by Bank Cash Balance per Ledger, unadjusted 2 Total deposits by Adobe Company during June Total deposits received by Makati Bank during June Deposits in Transit Total checks issued by Adobe Company during June Total checks paid by Makati Bank during June Outstanding Checks Cash Balance per Bank Statement, unadjusted Deposits in Transit Outstanding Checks Correct Cash Balance

5,200.00 800.00 (1,500.00) 4,500.00 4,000.00 (800.00) 1,300.00 4,500.00

28,900.00 11,100.00 (4,000.00) 36,000.00

20,000.00 600.00 (4,200.00) 16,400.00 63,000.00 (60,000.00) 3,000.00 45,000.00 (35,000.00) 10,000.00 224,650.00 3,000.00 (10,000.00) 217,650.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-47: Preparation of Bank Reconciliation Statement page 1 Date Particulars March 31 Accounts Receivable Cash To adjust the balance of the book. Liability on Discounted Note Notes Receivable To close contingent liability. 31 Accounts Receivable Cash To adjust the balance of the book. 31 Miscellaneous Expense Cash To adjust the balance of the book. F Debit 23,500.00 Credit 23,500.00

20,000.00 20,000.00

1,290.50 1,290.50

340.00 340.00

MERUDO COMPANY Bank Reconciliation Statement March 31, 2010 Cash Balance per Bank Statement, unadjusted Add: Deposits in Transit Subtotal Less: Outstanding Checks Less: Check No. 020168 Less: Check No. 020172 Less: Check No. 020176 Corrected Cash Balance Cash Balance per Book, unadjusted Less: Unrecorded Bank Debits Less: Dishonored Note Less: NSF Checks Less: Bank Service Charges Corrected Cash Balance P 15,030.86 14,816.59 P 29,847.45 P 1,112.40 645.23 2,940.15

4,697.78 P 25,149.67 P 50,280.17

P 23,500.00 1,290.50 340.00

25,130.50 P 25,149.67

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-48: Preparation of Bank Reconciliation Statement page 1 Date Particulars Jan 31 Cash Interest Income To adjust the balance of the book. Miscellaneous Expense Cash To adjust the balance in the book F Debit 400.00 Credit 400.00

350.00 350.00

MERCADO COMPANY Bank Reconciliation Statement January 31, 2010 Cash Balance per Bank Statement, unadjusted Add: Deposits in Transit Subtotal Less: Outstanding Checks Less: Check No. 02007 Less: Check No. 02009 Less: Check No. 02010 Less: Check No. 02011 Corrected Cash Balance Cash Balance per Bank Statement, unadjusted Add: Deposits in Transit Subtotal Less: Outstanding Checks Corrected Cash Balance P 46,450.00 15,000.00 P 61,450.00 P 1,200.00 6,000.00 800.00 1,000.00

9,000.00 P 52,450.00 P 52,400.00 400.00 P 52,800.00 350.00 P 52,450.00

PARTICULARS Cash Accounts Receivable Allowance for Doubtful Accounts Notes Receivable Merchandise Inventory, beginning Prepaid Expenses Furniture & Fixtures Accumulated Depreciation - Furniture & Fixtures Office Equipment Accumulated Depreciation - Office Equipment Accounts Payable Mortgage Payable Edith Joy, Capital Edith Joy, Drawing Sales Sales Discounts Sales Returns and Allowances Purchases Purchase Discounts Purchase Returns and Allowances Advertising Expense Light and Water Freight in Freight out Interest Expense Interest Income Office Supplies Expense Office Salaries Sales Salaries TOTAL Doubtful Accounts Expense Accrued Interest Income Merchandise Inventory, end Income and Expense Summary Depreciation Expense - Furniture and Fixtures Depreciation Expense - Office Equipment Commissions Expense Accrued Commissions Expense Accrued Interest Expense TOTAL Net Income TOTAL

Unadjusted Trial Balance Debit 102,040.00 106,120.00 46,440.00 82,800.00 9,960.00 82,730.00 23,440.00 171,560.00 51,468.00 94,280.00 164,200.00 214,180.00 28,520.00 766,200.00 10,000.00 7,096.00 484,836.00 5,440.00 9,168.00 25,320.00 45,568.00 8,392.00 7,056.00 8,362.00 6,960.00 14,160.00 62,200.00 40,696.00 1,343,856.00 Credit

EDITH JOY TRADING WORKSHEET December 31, 20Y9 Adjustments Debit Credit

Adjusted Trial Balance Debit 102,040.00 106,120.00 46,440.00 82,800.00 9,960.00 82,730.00 Credit

Income Statement Debit Credit

Balance Sheet Debit 102,040.00 106,120.00 46,440.00 Credit

8,520.00

2,092.00

10,612.00 82,800.00 9,960.00 82,730.00 39,986.00 171,560.00 171,560.00 85,780.00 94,280.00 164,200.00 214,180.00 28,520.00 766,200.00 10,000.00 7,096.00 484,836.00 5,440.00 9,168.00 25,320.00 45,568.00 8,392.00 7,056.00 15,862.00 25,320.00 45,568.00 8,392.00 7,056.00 15,862.00 9,080.00 14,160.00 62,200.00 40,696.00 14,160.00 62,200.00 40,696.00 9,080.00 10,000.00 7,096.00 484,836.00 5,440.00 9,168.00 766,200.00 28,520.00

10,612.00

16,546.00 34,312.00

39,986.00 85,780.00 94,280.00 164,200.00 214,180.00

7,500.00 2,120.00

1,343,856.00 2,092.00 2,120.00 75,950.00 75,950.00 16,546.00 34,312.00 7,491.04 7,491.04 7,500.00 146,011.04 16,546.00 34,312.00 7,491.04 7,491.04 7,500.00 1,489,867.04 2,092.00 2,120.00 75,950.00 75,950.00 16,546.00 34,312.00 7,491.04 7,491.04 7,500.00 624,029.04 1,410.96 625,440.00 2,092.00 2,120.00 75,950.00 75,950.00

146,011.04

1,489,867.04

864,427.04 1,410.96 865,838.00

865,838.00 865,838.00

625,440.00 625,440.00

Pua, Angelie Actbas2 K31 11045523 CN27

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-53: Preparation of Statement of Cash Flows TESSA NARITA COMPANY Statement of Cash Flows For the year ended December 31, 2010 Cash Flows from Operating Activities Collections from customers Interest on Bank Loan Operating Expenses Net Cash Flows provided by Operating Activities Cash Flows from Investing Activities Sale of Old Equipment Purchase of Equipment Net Cash Flows Used by Investing Activities Cash Flows from Financing Activities Bank Loan Additional Investment of Tessa Principal of Bank Loan Withdrawal of Tessa Net Cash Flows Provided by Financing Activities Net Increase in Cash Cash - January 1 Cash - December 31

270,000.00 (2,500.00) (112,000.00) 155,500.00

9,200.00 (20,000.00) (10,800.00)

100,000.00 50,000.00 (20,000.00) (10,000.00) 120,000.00 264,700.00 65,000.00 329,700.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-53: Preparation of Statement of Cash Flows CORA UBIDO COMPANY Statement of Cash Flows For the year ended December 31, 2010 Cash Flows from Operating Activities Collections from customers Dividends on Stock Investments Interest on Bank Loan Operating Expenses Net Cash Flows provided by Operating Activities Cash Flows from Investing Activities Sale of Furniture Purchase of Equipment Net Cash Flows Used by Investing Activities Cash Flows from Financing Activities Bank Loan Additional Investment of Cora Principal of Bank Loan Withdrawal of Cora Net Cash Flows Provided by Financing Activities Net Increase in Cash Cash - January 1 Cash - December 31

110,000.00 7,000.00 (2,000.00) (70,500.00) 44,500.00

32,000.00 (60,000.00) (28,000.00)

120,000.00 125,000.00 (15,000.00) (12,000.00) 218,000.00 234,500.00 32,000.00 266,500.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-55: Financial Statements RYE TRADING Income Statement For the year ended December 31, 20Y9 Net Sales Cost of Goods Sold Gross Profit Other Income Total Income Operating Expenses Distribution Expenses Advertising Expenses Interest Expense Net Income RYE TRADING Statement of Changes in Equity For the year ended December 31, 20Y9 Cora, Capital - January 1 Add: Net Income Subtotal Less: Cora, Drawing Cora, Capital - December 31 RYE TRADING Statement of Cash Flows For the year ended December 31, 20Y9 Cash Flows from Operating Activities Cash Sales Collections on Accounts Receivable Payment of Account Purchases Cash Payments for Operating Expenses Net Cash Flows Provided by Operating Activities Cash Flows from Investing Activities Sale of Old Office Equipment Acquisitions of Furniture and Equipment Net Cash Flows Used in Investing Activities Cash Flows from Financing Activities BDO Loan with Collateral Settlement of Promissory Note on Loan Net Cash Flows Used in Financing Activities Net Increase in Cash Cash balance, beginning Cash balance, end 120,007.00 67,381.00 187,388.00 (5,400.00) 181,988.00 1 2 3 645,845.00 (458,882.00) 186,963.00 2,122.00 189,085.00 20,725.00 95,494.00 5,485.00

4 5

(121,704.00) 67,381.00

250,485.00 222,190.00 (231,432.00) (99,968.00) 141,275.00

13,264.00 (50,000.00) (36,736.00)

120,000.00 (169,350.00) (49,350.00) 55,189.00 10,000.00 65,189.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-55: Financial Statements RYE TRADING Statement of Financial Position December 31, 20Y9 ASSETS Current Assets Cash Trade and Other Receivables Merchandise Inventory Unexpired Rent Non-Current Assets Property, Plant and Equipment Total Assets LIABILITIES AND OWNER'S EQUITY Current Liabilities Trade and Other Payables Non-Current Liabilities Mortgage Payable Total Liabilities Owner's Equity Cora, Capital Total Liabilities and Owner's Equity

65,189.00 171,120.00 75,150.00 15,815.00

327,274.00

151,920.00 479,194.00

177,206.00

120,000.00 297,206.00

181,988.00 479,194.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-55: Financial Statements Notes to the Financial Statements Note 1 - Net Sales Sales Less: Sales Discounts Sales Returns and Allowances Net Sales Note 2 - Cost of Goods Sold Merchandise Inventory - January 1 Add: Net Cost of Purchases Purchases Less: Purchase Discounts Purchase Returns and Allowances Net Purchases Add: Freight In Cost of Goods Available for Sale Less: Merchandise Inventory, December 31 Cost of Goods Sold Note 3 - Other Income Interest Income Gain on Sale of Property Total Other Income Note 4 - Distribution Expenses Sales Commission Depreciation Expense - Store Furniture and Equipment Freight Out Total Distribution Expenses Note 5 - Administrative Expenses Salaries and Wages Rent Expense Depreciation Expense - Office Equipment Doubtful Accounts Expense SSS & Philhealth Premiums Expense Office Supplies Expense Total Administrative Expenses Note 6 - Trade and Other Receivables Accounts Receivable Less: Allowance for Doubtful Accounts Notes Receivable Total Trade and Other Receivables

660,985.00 10,580.00 4,560.00 15,140.00 645,845.00

188,500.00 366,200.00 (18,265.00) (3,653.00) 344,282.00 1,250.00

345,532.00 534,032.00 (75,150.00) 458,882.00

1,771.00 351.00 2,122.00

13,535.00 6,510.00 680.00 20,725.00

54,200.00 30,000.00 7,230.00 2,590.00 954.00 520.00 95,494.00

138,500.00 (4,680.00)

133,820.00 37,300.00 171,120.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-55: Financial Statements Notes to the Financial Statements Note 7 - Property, Plant and Equipment Store Furniture and Equipment Accumulated Depreciation - Store Furniture and Equipment Office Equipment Accumulated Depreciation - Office Equipment Carrying Value Note 8 - Trade and Other Payables Accounts Payable Notes Payable Withholding Taxes Payable SSS & Philhealth Premiums Payable Unearned Sales Income Total Trade and Other Payables

107,100.00 (13,020.00) 72,300.00 (14,460.00)

94,080.00 57,840.00 151,920.00

112,850.00 55,650.00 3,906.00 2,750.00 2,050.00 177,206.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-55: Financial Statements page 1

DATE PARTICULARS Dec 31 Sales Purchase Discount Purchase Returns and Allowances Interest Income Gain on Sale of Equipment Income Summary To close all nominal accounts with credit balances. 31 Income Summary Merchandise Inventory, January 1 Sales Discount Sales Returns and Allowances Purchases Freight In Sales Commission Depreciation Expense - Store Furniture and Equipment Freight Out Salaries and Wages Rent Expense Depreciation Expense - Office Equipment Doubtful Accounts Expense SSS & Philhealth Premiums Expense Office Supplies Expense Interest Expense To close all nominal accounts with debit balances. 31 Income Summary Cora, Drawing To close income summary to drawing. 31 Cora, Drawing Cora, Capital To close drawing to capital.

DEBIT 660,985.00 3,653.00 18,265.00 1,771.00 351.00

CREDIT

685,025.00

692,794.00 188,500.00 10,580.00 4,560.00 366,200.00 1,250.00 13,535.00 6,510.00 680.00 54,200.00 30,000.00 7,230.00 2,590.00 954.00 520.00 5,485.00

67,381.00 67,381.00

61,981.00 61,981.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-55: Financial Statements RYE TRADING Post-Closing Trial Balance December 31, 20Y9 Account Titles Cash Accounts Receivable Allowance for Doubtful Accounts Notes Receivable Merchandise Inventory Unexpired Rent Office Equipment Accumulated Depreciation - Office Equipment Store Furniture and Equipment Accumulated Depreciation - Store Furniture and Equipment Accounts Payable Notes Payable Unearned Sales Income Withholding Taxes Payable SSS & Philhealth Premiums Payable Mortgage Payable Cora, Capital Total

Debit 65,189.00 138,500.00 37,300.00 75,150.00 15,815.00 72,300.00

Credit

4,680.00

14,460.00 107,100.00 13,020.00 112,850.00 55,650.00 2,050.00 3,906.00 2,750.00 120,000.00 181,988.00 511,354.00

511,354.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Exercise 3-58: Reversing Entries page 1

DATE 1 No Entry 2 No Entry 3 No Entry

PARTICULARS

DEBIT

CREDIT

4 Accrued Interest Expense Interest Expense To reverse the entries. 5 Insurance Expense Prepaid Insurance To reverse the entries. 6 Accrued Salaries Expense Salaries Expense To reverse the entries. 7 Interest Income Accrued Interest Income To reverse the entries. 8 No Entry

3,000.00 3,000.00

15,300.00 15,300.00

9,600.00 9,600.00

2,200.00 2,200.00

Unit III - Accounting Cycle - Merchandising Concern: Purchase and Sale of Merchandise Additional Exercises on Adjusting Entries page 1

DATE PARTICULARS Dec 31 Prepaid Insurance Insurance Expense To adjust for the unexpired portion of insurance expense. 31 Interest Expense Accrued Interest Expense To adjust for accrued interest on notes payable. 31 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. 31 Doubtful Accounts Expense Allowance for Doubtful Accounts To adjust for doubtful accounts. 31 Rent Revenue Unearned Rent Revenue To adjust for the unearned portion of rent revenue. 31 Accrued Interest Income Interest Income To adjust for accrued interest on notes receivable. Oct 1 Cash Interest Receivable Interest Revenue To record collection of interest. Cash Interest Revenue To record collection of interest. Dec 31 Unearned Rent Revenue Rent Revenue To adjust for the earned portion of rent revenue. 31 Insurance Expense Prepaid Insurance To adjust for the expired portion of prepaid insurance. 31 Rent Expense Prepaid Rent To adjust for the expired portion of prepaid rent.

DEBIT 3,400.00

CREDIT 3,400.00

450.00 450.00

14,300.00 14,300.00

5,200.00 5,200.00

3,500.00 3,500.00

300.00 300.00

2,400.00 1,800.00 600.00

2,400.00 2,400.00

44,300.00 44,300.00

120,000.00 120,000.00

10,000.00 10,000.00