Question

January 1 – On January 1, 2020, Audrey started her merchandising business and invested P10,000,000 cash and two delivery trucks worth P5,000,000 with an estimated useful life of 10 years and a salvage value of P500,000 as her initial capital.

January 1 – Audrey paid insurance policy for P19,000 and recorded it as prepaid insurance.

January 20 – Sold goods to customers worth P2.500,000 for cash

February 1 – Purchase furniture worth P250,0000 and office equipment worth P850,000 for cash, with salvage value of P25,000 and P85,000 respectively. Their estimated useful life is 5 years

March 8           – Purchase office supplies from ABC Corporation worth P100,000, she paid 60%, balance on account

March 14 – Sold goods to Margaux for P2,000,000 (75% cash sales, balance on credit)

May 18            – She withdrew P200,000 for personal use July 20    – Sold goods to Carlo for 4,500,000 on credit August 22 – Paid ABC Corporation for the balance September 1         – Audrey barrowed P500,000 from ABC Bank. September 26   – Received the balance from Margaux October 28   – Received 80% on the sales made in July 20

November 15 – Sold goods to Ina worth P5,000,000 with 20% down payment and the balance on account

December 30    – Paid salaries of 15 employees for the month of December - P450,000.

Additional information, December 31, 2020:

1. Prior to recording the adjusting entries, a physical count of the supplies showed that P22,500 were unused.
2. The insurance policy purchased by Audrey on January 1 is a five-year insurance policy with coverage starting immediately.
3. The loan from ABC bank is subject to 9% interest per annum for five years. The interest is paid when the loan matures one year from the issue date
4. On December 1, Audrey received P5,340,000 from its customer for a truck of goods to be delivered on December 30 of the current year, however, the Accountant failed to record the said transaction in Audrey’s books of accounts.

Required – in EXCEL (sheet 1 to 7) format:

1. Journalize the above-mentioned transactions
2. Prepare the General Ledger/T-Accounts
3. Prepare the unadjusted trial balance
4. Journalize the adjusting entries
5. Prepare worksheet which includes (Unadjusted TB, Adjustments, Adjusted TB, Income Statement, Balance sheet)
6. Balance Sheet (Statement of Financial Position)
7. Income Statement (Statement of Financial Performance)
8. Statement of Changes in Owner’s Equity

Answer 1

Journal Entries :

January 1 : Debit: Cash for P 10,000,000 & Truck[Fixed Asset] for P 5,000,000

Credit : Capital for P 15,000,000

January 1: Debit: Prepaid Insurance for P 19,000

Credit : Cash for P 19,000

January 20: Debit: Cash P 2,500,000

  Credit: Sales P 2,500,000

February 1 : Debit: Furniture for P 2,500,000 & Office equipment : for P 850,000

   Credit Cash for P 3,350,000

March 8 : Debit: Office Supplies for P 100,000

Credit : Cash for P 60,000 & ABC Corporation for P 40,000

March 14 : Debit: Cash for P 1,500,000 & Margaux for P 500,000

Credit ; Sales 2,000,000

May 18 Debit: Drawings for P 200,000

Credit: Cash for P 200,000

July 20 : Debit : Carlo for P 4,500,000

Credit ; Sales for P 4,500,000

August 22 : Debit : ABC Corporation for P 40,000

Credit : Cash for P 40,000

September 01 : Debit: Bank for P 500,000

Credit : ABC Bank Loan for P 500,000

September 26: Debit : Cash for P 500,000

Credit : Margaux for P 500,000

October 28: Debit : Cash for P 3,600,000

Credit : Carlo for P 3,600,000

November 15: Debit: Cash for 1,000,000 & INA for 4,000,000

Credit: Sales 5,000,000

December 30: Debit: Salaries for P 450,000

Credit : Cash for P 450,000

Note: As per our guidelines we are required to give solution only to 1st requirement