Project and Research

Learn how to work with the group! There are three different ways to finish this project and research: First: Solve the project and research by yourself, but with proper guidance and supervision of an accounting faculty. Second: Solve the project and research with your assigned group in accounting, accompanied by group discussions and the guidance of a faculty. Third: Copy the finished project and research from somebody else. Of the three ways, the easier is the third. But definitely, this is the worst choice you could make. Choosing the third is tantamount to cheating yourself. Nobody wants to cheat oneself, right? The best choice is the second. This is the most difficult but it would be the most fruitful of the three ways. Whatever time, effort and money are used while working on this project and research, treat them as a long-term investment. Think about this! Instructions to the Group: 1. Secure the following materials a. Long Bond Papers b. 2-Column Journal Sheets (white) c. Plastic Envelop 2. Based on the given business transactions below, prepare the following: a. Store/Office Layout b. Expanded Accounting Equation (long bond paper) c. T-Accounts (long bond paper) d. Journal Entries (2-column journal sheets) 3. Last day of submission is on January 13, 2012, Friday. Background of Bart M. Manuel, Architect Bart M. Manuel is a graduate of UST. After passing the board examinations for Architecture, Bart M. Manuel was gainfully employed by SM as its in-house architect and interior designer. At the start of this year, Architect Bart M. Manuel resigned from his job in SM and put up his own architectural firm under the registered name of Bart M. Manuel, Architect. Manuel was able to buy furniture, fixtures, equipment and other assets of a relative, Arch. Andres A. Vergara, who retired and decided to join his family in Canada. Manuel got the fixed assets of Vergara at prices and terms that are very reasonable. Some of the friends and former classmates of Manuel wanted to be part of the new architectural firm. However, Manuel opted to practice as a sole proprietorship. He is confident that he is equipped for this new challenge. Architect Bart M. Manuel is your uncle. He asked for your help in connection with the bookkeeping needs of his new firm. Although you are very young and inexperienced, you saw this invitation as an opportunity to learn. So, you gladly accepted the challenges offered by Arch. Manuel.

After doing some careful researches and thorough inquiries, you came up with the Chart of Accounts, as given in the following section, which you decided to use in recording transactions of the business. Because there are not too many transactions, you believe that a manual accounting system would be appropriate. Chart of Accounts of Bart M. Manuel, Architect Cash Accounts Payable Accounts Receivable Advances from Customers Prepaid Rent Bart M. Manuel, Capital Prepaid Insurance Bart M. Manuel, Drawing Unused Supplies Professional Fees Furniture and Fixtures Salaries and Wages Office Equipment Consultancy Expenses Automobile Taxes and Licenses Leasehold Improvements Gasoline Expense Tools Rent Expense Utility Expense Repairs and Maintenance Business Transactions June Architect Bart M. Manuel transferred cash from a personal bank account to 1 an account to be used for his business, P250,000. 2 Purchased the following assets (on cash) from Andres A. Vergara: Furniture and fixture (drawing table and chair, other worktables and chairs, counter, cabinets and sofa), P35,800. Office equipment (airbrush and compressor, computer with CADD and other design software, and electric fans), P75,000. Tools (scales, T-squares, curves and other architectural gadgets), P10,000. Unused supplies (tracing paper, pens, pencils, cartridges, folders, binders and coloring materials), P5,200. 3 Purchased bookkeeping supplies for cash (columnar books, and ledgers), P500. Cost incurred in registering the business with various government agencies, paid in cash, P3,200. Paid the required permits and licenses for the calendar year, P4,015. Paid office rent for the month of June and July, P20,000. 4 Manual increased his investment by putting additional cash of P10,000. Professional services rendered to various customers, on credit, P15,700. 5 Received payment from Myrna Gorospe, P10,000. This is a partial payment for the professional services in connection with the renovation of the kitchen of Gorospe. 6 Bought additional office supplies from Coroa Supplies, P5,250. Term: n/20. (n/20 means that the buyer is given 20 days from June 6 to settle the account with the seller.) 7 Manuel transferred his personal automobile to the firm, to become part of his investment. At the time of transfer, the automobile has a reliable appraised value of P210,000. 8 Paid P650 from cash on hand. This payment represents the gasoline consumption during the week. 9 Paid Abba Insurance Company, P7,500. This is for one-year TPL insurance premium of the automobile. Insurance coverage is from June 10, 2011 to June 9, 2012. 10 Collected additional professional fees due from Myrna Gorospe, P15,000. Paid P2,000 to Shell Gasoline Station, for the tune-up and other minor repairs and maintenance jobs on the automobile. 12 Paid Nick Mallari, a contractor, for the cost of improving leased office space, P15,000. 14 Received a statement of account from Printers Art for ordered stationery, business cards, and other office supplies, P2,820. Term: n/30.

15 Paid the salary of the part-time office clerk, Lourdes Aquino, P3,500. Paid P550 from cash on hand. This payment represents the gasoline consumption during the week. 16 Paid personal expenses of Bart M. Manuel, P8,000. 17 Paid Meralco, P1,150, for the electrical consumption until June 14. Bought additional office supplies from Coroa Supplies, P4,210. Term: n/20. Billed Estella Flores for professional services rendered, P25,000. Term: n/30. 19 Bought a modem, external hard drive and other computer accessories from ProData Corporation, P9,500. Term: n/20. 20 Withdrew P3,000 for personal use. 21 Paid P770 from cash on hand. This payment represents the gasoline consumption during the week. 23 Collected P10,000 for various professional services rendered to clients. 25 Received cash, P25,000, from Enterprise Capital Bank, for professional services rendered in redesigning the interior of its new branch office in Taguig City. 26 Paid Coroa Supplies on the purchase made on June 6. Paid Engr. Lambert Valerio, for engineering and structural consultancy services he rendered in connection with one of the projects, P5,000. 27 Received cash, P5,000, for professional services rendered to a client. Paid PLDT bill covering June 1 to 18, P725. Paid P660 from cash on hand. This payment represents the gasoline consumption during the week. Paid ProData Corporation for the full obligation. 28 Withdrew P12,000 for personal use. 30 Paid the salary of Marlon Cabrera and Venancio Castro, draftsmen, for services related to the on-going renovation projects, P20,000. Bought the following from Modern Designs, term: on account: Conference table, with chairs, P16,000 Computer table, P2,800 Paid the salary of the part-time office clerk, Lourdes Aquino, P4,500. Bought a brand new computer printer from ProData Corporation. The list price of the printer is P13,500. However, ProData agreed to a final purchase price of P12,000. Armando Vargas, a new client, made an advance payment of P10,000. This is a renovation job that is scheduled to begin at the end of July.