Reference no: EM131590148
Problem 1 -
You decided to open a Merchandising business in Davao City on December 1, 2015 under your name with the following investments:
Cash on Hand P500,000 Merchandise Inventory 650,000
Store Furniture and Fixture 409,000 Travel Equipment 174,000
Cash in Bank 400,000
The ff. transactions occurred during December 2015( the company practice the use of imprest system):
Dec. 1 Establish petty cash fund of P20,000.
Sold merchandise to Duterte Merchandising amounting to P280,000 with a downpayment of P80,000. Duterte merchandising issued a check under the name of your business and it was deposited to your account.
Issued checks as payment for the ff. (expense method)
Rent for three months P60,000 Advertising for three months 24,000
Store Supplies 30,000 Insurance Expense for 12 months 36,000
3 - Sold merchandise to Yee Trading, P200,000 on account. Freight paid out of the petty cash fund, P3,000.
4 - Received a merchandise return by Duterte Merchandising amounting to P15,000.
5 - Purchased merchandise on account from Badoy Supplier, P350,000. Your company issued a check amounting to P150,000 as downpayment.
7 - Yee Trading return a merchandise amounting to P15,000.
Received P50,000 from Duterte Merchandising as partial payment of the account.
9 - Sold merchandise to Orange Company, P80,000 on account.
10 - Received check from Duterte Merchandising as full payment of the account.
Returned a merchandise to Badoy Supplier for damaged products, P15,000.
12 - Received a check from Yee Trading as full payment of the account.
15 - Your company borrowed from a friend amounting P300,000 and the same amount was credited to the company's account.
Issued checks as payment of the ff.
Salaries and Wages P30,000Badoy Supplier as full payment ?
For personal use 15,000 Light and Water 2,500
15 - Issued checks as payment of the ff. (asset method)
Internet and Cable (2 months) 20,000 Postage Stamps 5,000
Additional Information:
a. Merchandise December 31, 2015 per physical count, P420,000.
b. Store supplies expenses, P20,000.
c. Store furniture and fixture acquired on December 1, 2015 has 4 years estimated useful life with P25,000 salvage value.
d. Travel equipment acquired on December 1, 2015 has estimated useful life of 3 years with a residual value of P12,000.
e. Doubtful account expenses is 5.5% of net sales.
f. The loan from a friend has 0.8% interest rate per month, and payable 6 months after December 1, 2015.
g. Postage stamps used, P2,700.
h. Unpaid taxes and licenses, P15,000.
Required:
1. Record the transactions in a two-column general journal
2. Record the adjustments in a two-column general journal
3. Prepare a 10 - column worksheet.
4. Prepare the statement of comprehensive income in good form
5. Prepare the statement of changes in owner's equity
6. Prepare the statement of financial position
7. Record the closing entries in a two-column general journal
8. Prepare a post-closing trial balance
9. Record the reversing entries in a two-column general journal.
Problem 2 -
Angel opened her Merchandising business on December 1, 2015 under the trade name Angel Mercantile with the following investments:
Cash on Hand P250,000
Merchandise Inventory 550,000
Store Furniture and Fixture 280,000
Store Equipment 190,000
Bank Loan Payable - Short Term 250,000
The ff. transactions occurred during December 2015:
Dec. 1 Opened a current account in the bank with initial deposit of P250,000.
1 - Sold merchandise on account to Yellow Merchandising, P80,000.
Issued checks as payment for the ff. (expense method)
Rent for three months P30,000
Advertising for four months 16,000
Store Supplies 24,000
3 - Sold merchandise to Brown Trading, P100,000 on account. Freight paid out of cash on hand, P2,000.
4 - Received a merchandise return by Yellow Merchandising amounting to P5,000.
5 - Purchased merchandise on account from Macro Supplier, P250,000.
7 - Brown Trading return a merchandise amounting to P12,000.
Received P40,000 from Yellow Merchandising as partial payment of the account.
9 - Sold merchandise to Orange Company, P80,000 on account.
10 - Received check from Yellow Merchandising as full payment of the account.
Returned a merchandise to Macro Supplier for damaged products, P15,000.
12 - Received a check from Brown Trading as full payment of the account.
15 - Issued checks as payment of the ff. (expense method)
Salaries and Wages P25,000
Insurance for three months 12,000
Macro Supplier as full payment ?
For personal use 20,000
Light and Water 2,000
Postage Stamps 1,000
Travelling expenses 4,000
Additional Information:
a. Merchandise December 31, 2015 per physical count, P420,000.
b. Store supplies expenses, P10,000.
c. Store furniture and fixture acquired on December 1, 2015 has 6 years estimated useful life with no salvage value.
d. Store equipment acquired on December 1, 2015 has estimated useful life of 5 years with a residual value of P10,000.
e. Doubtful account expenses is 3% of net sales.
f. The bank loan has 6% interest rate per annum, and payable 6 months after December 1, 2015.
g. Postage stamps used, P800.
h. Unpaid taxes and licenses, P5,000.
Required:
1. Record the transactions in a two-column general journal
2. Post to the ledger
3. Prepare the preliminary trial balance.
4. Record the adjustments in a two-column general journal
5. Prepare a 10 - column worksheet.
6. Prepare the statement of comprehensive income in good form
7. Prepare the statement of changes in owner's equity
8. Prepare the statement of financial position
9. Record the closing entries in a two-column general journal
10. Prepare a post-closing trial balance
11. Record the reversing entries in a two-column general journal.