Question

Prepare the Income Statement, Balance Sheet and Statement of Owner's Equity in an Excel File. (1). Mr. Sheng sought an attorney for legal advice to help him start a company, The Sheng Enterprise, which sells native rattan bags. On January 1, 2010, Mr. Sheng invested P2,000,000.00 cash in the business. The attorney advised him to hire an accountant for his bookkeeping. Mr. Sheng paid P1,000.00 for the legal services. However, Mr. Sheng was preoccupied with the product development that was already the end of January before he hired you to straighten out his records. While understanding the business transactions that occurred during January, you discover that: After he invested P2,000,000.00 cash and paid the attorney, P1,000.00, on January 5, Mr. Sheng borrowed P600,000.00 from the bank, where he has to pay the bank a part of the principal and interest monthly for 1 year starting this January 31st. That is, a fixed P50,000.00 from the principal and interest amounting, P1,500.00. On January 13, Mr. Sheng purchased a secondhand delivery truck in the company name, paying P450,000.00 down and financing P300,000.00. The first payment on the truck is due February 15. Apart from this, he also rented an office and paid 3 months’ rent of P36,000.00 in advance, credit purchase of office equipment of P45,000.00, cash purchase of supplies amounting, P15,000.00. On the 24th of January, Mr. Sheng sold P180,000.00 worth of rattan bags- P75,000.00 were credit transactions. Of the credit transactions, P32,000.00 was collected during January 31 and the balance remained to be collected at the end of February. On January 31, the company received a bill of P7,000.00 for the January utility expenses and a check amounting, P6,000.00 from a customer for orders to be completed February. Lastly, wages of P15,000.00 were paid to the employees.

Answer 1