Accounting 162 – Material 001

1. The remaining steps in the accounting cycle performed at the end of the year are:
1. Closing entries 3. Financial statements 5. Post – closing trial balance
2. Reversing entries 4. Adjusting entries
The proper sequence is 43152
2. If the total liabilities amount to P2,196,000 which is 60% of the total assets, what is the amount of the total assets of the business?3.66
3. On January 1, the assets were P500,000 and the liabilities were P200,000. During the year, the assets increased by P100,000 and the
liabilities decreased to P150,000. Determine the owner’s equity at December 31. 450K
4. Bess Quedan began operating the Ace Modelling Agency by inventing cash of P200,000, ½ of which was paid for the lease contract of floor
space in Makati. She also borrowed P500,000 from PNB, ¼ of this was used to buy furniture and fixtures and P100,000 for the purchase of
computer, printer and fax machine. She issued to PNB a 180-day promissory note as owner-manager of the business. She also bought a
car for P600,000 from World Motors paying 50% in cash with the balance payable within a year. The business was ready for operation on
March 31, 20A. Determine the amount of total assets. 1M
5. The information below are taken from the books of Mr. Larong Pinoy for the year ended December 31, 200A.
Jan 1, 200A Jan 1, 200B
Assets 200,000 300,000
Liabilities 80,000 120,000
Mr. Pinoy made an additional investment of P40,000 during the year. Revenue and expenses during the year amounted to P180,000 and
P80,000. Determine the amount of withdrawal.80K
6. Presented below are the non-current assets of Mars Pillow Company.
Acquisition date Property Cost Scrap Estimated life
April 1, 2011 Building 2,000,000 7.5% 25 years
August 31, 2015 Furniture & fixtures 127,000 5,000 10 years
October 16, 2017 Office equipment 99,000 3,000 8 years
Determine the carrying amount of the property as of December 31, 2017 1,695,533.
7. The unexpired insurance account before adjustment on December 31, 2017 shows a balance of P71,100. This balance is made up of the
following policies. 45,800
a. A 3-year policy, dated October 1, 2016, premium P21,600.
b. A 5-year policy dated March 31, 2015, premium P66,000.
c. A 1-year policy, dated June 1, 2017, Premium P8,400
If proper adjusting entry was made, what is the balance of the prepaid insurance?
8. Unadjusted unearned rent has a credit balance of P139,500, composed of the following items:
a. January balance of P37,500, representing customer’s prepaid rent for January thru May.
b. A credit posting of P102,000 representing payment for annual rent of P8,500 a month, beginning June.
On December 31, what is the ending balance of unearned rent after adjustment? 42,500 Rent expense? 97,000
9. Worker’s wages for the 6 – day week is P12,000 payable every Saturday. December 31 falls on Tuesday. Determine the wage expense that
should be accrued at December 31. 4K
10. A salesman receives his commission 15 days after the close of every sales transaction. He made a sale worth P500,000 on December 27,
2017. His commission on the sale is 5%. An adjusting entry would include a credit to (account title and amount). Commission liability 25K
11. The equipment amount to P50,000 showed an accumulated depreciation of P15,750 as of December 31, 2017. If the estimated useful life is
10 years and scrap of P5,000, the acquisition date was. July 1, 2014
12. The company provides for uncollectible accounts based on 5% of net sales. During 2017, the provision amounted to P5,500 and the sales
return and allowances amounted to P5,000. How much was the gross sales? 105,000
13. The income statement showed utilities expense of P24,000 and the balance sheet showed utilities payable of P4,000. How much was the
utilities paid? 20K
14. The income statement showed rent income of P55,000 for the year 2012. If the balance sheet showed unearned rent income of P5,000 as
of December 31, 2012 and P5,000 accrued rent income, how much was the total cash collected from rental? 55K
15. A buyer is entitled to a 2% discount is he/she pays his/ her account within 10 days. What is the amount of cash discount allowable on a sale
of P15,000 on which the seller prepays the freight of P1,000. 300
16. Given the following information regarding the sales of Melon and Syrup Merchandisers, how much cash was received from customers during
the year assuming all accounts are collected within the discount period? Accounts receivable, January 1, 200Y - 540,000; Accounts
receivable, January 1, 200X - 360,000; Year’s sales - 4,500,000; Terms: 2/10; n/30. 4,233.6
17. The gross profit rate of Peridot Company is 40% of net sales. Ledger balances showed the following, Sales, P6,000,000; Sales returns and
allowances, P1,000,000; Purchases, P3,200,000; Freight – in, P300,000; Merchandise inventory beg., P500,000. The cost of merchandise
inventory ending is:1M
18. The following information was taken from the income statement: Sales, P34,000; Salaries expense, P12,000; Utilities expense, P3,000. If
the owner withdrew P2,000 from the firm, thereby resulting in a P3,000 decrease in capital after affecting the net loss, how much is the net
loss? 1K
19. How much is the cost of sales? 20K
FOR THE NEXT TWO REQUIREMENTS: Lou Gue Trading sold merchandise to Boom Co.
Invoice date List price Trade discount Date paid Returns
Oct 07 P130,000 15-15 October 18 P20,000
Oct 25 P550,000 5-10-15 November 10 P50,000
With the aforementioned transactions, determine the amount of sales to be recorded and the amount of collection. Terms: 2/15, n/60.
20. October 07 sales 93,925
21. October 25 collection 349,712.50
FOR THE NEXT 2 REQUIREMENTS: The following balances have been excerpted from Edwards' balance sheets: 532,500
December 31, 2017 December 31, 2016
Prepaid Insurance P 6,000 P 7,500
Interest Receivable 3,700 14,500
Salaries Payable 61,500 53,000
Edwards Company paid or collected during 2017 the following items:
Insurance premiums paid P 41,500
Interest collected 123,500
Salaries paid 481,000
22. Compute the interest income 112,700
23. Determine the amount of total expenses (2017) based on the given information. 532,500
24. The following information is available for ABC Company: Payment for goods during 2018 - P82,000; Accounts payable, January 1, 2018 -
9,000; Inventory, January 1, 2018 - 10,400; Accounts payable, December 31, 2018 - 7,200; Inventory, December 31, 2018 - 59,700. Cost of
goods sold for 2018 is 30900
25. The December 31, 2015 statement of financial position of Hazel Company showed the following current assets: Cash and cash
equivalent - 700,000; Accounts receivable - 1,200,000; Inventories - 600,000. An examination of the accounts revealed that the accounts
receivable include the following: Trade accounts - 930,000; Allowance for doubtful accounts- 20,000 ; Claim against shipper for goods lost
in transit - 30,000; Selling price of unsold goods sent by Hazel on consignment - at 130% of cost and not included in Hazel's ending inventory.
- 260,000. What is the correct amount of currents assets on December 31, 2015? 2,440,000