Journalizing, Posting and Trial Balance Preparation

Name: ____________________________________________ Date: ____________ Score: ___________

I. On April 1, 2014, Ernesto Parducho established an interior decorating business, NeoTechno

Designs. During the remainder of the month, John completed the following transactions related
to the business.

April 5 Parducho transferred cash from a personal bank account to an account to be used for the
business,P750,000.

6 Paid rent for period of April 6 to end of month, P24,000.

7 Purchased office equipment on account, P210,000.

8 Purchased a service vehicle for P630,000, paying P250,000 cash and giving a note for the
remainder.

10 Purchased supplies for cash, P6,575.

12 Received cash for decorating jobs completed, P146,000.

20 Paid annual premiums on property and casualty insurance, P18,000.

23 Recorded jobs completed on account and sent invoices to customers, P123,750.

24 Received an invoice for vehicle expenses, to be paid in May, P22,500.

29 Paid utilities expense P7,500.

29 Paid miscellaneous expenses, P2,100.

30 Received cash from customers on account, P44,000.

30 Paid salaries of employees:

Salaries P 30,000
Less: SSS P 550
Philhealth 300
Withholding Tax 2,200 3,050
Net Pay P 26,950
=======
30 Paid creditor a portion of the amount owed for equipment purchased on April 7, P36,000.
30 Withdrew cash for personal use, P140,000.
30 Employer’s share: SSS, P560; Philhealth, P300.

Required: (70%)
1. Journalize the transactions using two-column journal.
2. Post the entries using T- accounts.
3. Prepare a Trial Balance using two-column journal.

Assets Owner’s Equity

Cash Parducho, Capital
Accounts Receivable Parducho, Drawing
Supplies Income
Prepaid Insurance Decorating Fees
Equipment Expenses
Service Vehicle Rent Expense
Liabilities Wages Expense
Notes Payable Utilities Expense
Accounts Payable Service Vehicle Expense
SSS premium payable Miscellaneous Expense
Philhealth premium payable SSS Contribution
Withholding tax payable Philhealth Contribution

II. Write True if the statement is correct and False if not. Strictly NO ERASURE. (15%)
___________1. Footing means transferring the amounts from the journal to the appropriate accounts in
the ledger. False
___________2. A trial balance may balance but may not be correct. True
___________3. Double posting of a transaction causes the debits and credits not to balance. False
___________4. Amounts entered on the left side of an account, regardless of the account title, are
called credits or charges to the account. False
___________5. The process of recording transaction in a journal is called journalizing. true
___________6. A recording error caused by the erroneous rearrangement of digits, such as writing P879
as P789, is called sliding. false
___________7. A trial balance with equal debit and credit totals proves that all transactions have been
correctly journalized and posted to the proper ledger accounts. true
___________8. The sequence of the account titles in a trial balance depends upon the size of the
account balance. true
___________9. A transposition error means a posting of journal entry to the wrong ledger account. false
___________10. The journal is chronological record of the entity’s transactions. It is also used to
classify and summarize transactions, and to prepare data for basic financial statements. True
___________11. A trial balance will disclose an error, if the error is a journal entry that has not been
posted in its entirety. true
___________12. Omission in posting in either debit or credit entry in the journal will affect the total of a
trial balance. true
___________13. Debits in the journal are posted as debits in the ledger, and credits in the journal as
credits in the ledger. true
___________14. If the sum of the credits is greater than the sum of its debits, the account has a debit
balance. false
___________15. Each account has its own record in the ledger. true

III. Determine the missing amounts to make the T-account true. Place the amount after the ?: The
first one is done for you. (15%)

Previous Debit Credit New Balance

Balance
1. Susan dela Fuente, P10,000 5,000 ? P 20,000 P25,000
Capital
2. Accounts Payable 90,000 ? _____________ 40,000 100,000
3. Equipment 40,000 50,000 5,000 ?____________
4. Supplies Expense ?_____________ 15,000 2,000 29,000
5. Accounts Receivable 15,000 60,000 ?____________ 45,000
6. Cash in Bank 30,000 ?______________ 14,000 57,000
7. Notes Payable 40,000 10,000 ? ___________ 80,000
8. Taxes and Licenses ?______________ 5,000 1,500 8,000
9. Prepaid Rent 7,000 8,000 3,000 ? ___________
10. Notes Receivable 5,000 25,000 ? ___________ 18,000
11. Service Income 12,000 ?______________ 80,000 70,000
12. Transportation ? _____________ 4,000 1,200 8,000
Expense
13. SSS Premium Payable 3,000 ? _____________ 3,500 1,800
14. Furniture and Fixtures 100,000 45,000 36,000 ? ___________
15. Unused Supplies 30,000 16,000 ? ___________ 15,500
16.Accrued Salaries 14,000 8,000 6,000 ? ___________
expense

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GOOD LUCK!