Supplementary Problem- F.

Zalameda

As of June 30, the books of F. Zalameda had the following balances:

11 Cash P 12,300
13 Transportation Equipment 250,000
14 Office Equipment 8,800
15 Offices Furniture and Fixtures 15,600
16 Professional Library 54,500
31 Zalameda, Capital 341,200

For the month of July the following transactions transpired:

July 2 Paid P1,500 for rent of the office for May.
4 Paid P300 for parking space for the car. (Use Rent Expense).
6 Paid the city government for business registration fees and mayor’s permit, P250.
8 Bought new office table from Rex Furniture costing P910 on account payable in 30 Days.
10 Sold an old office typewriter for P1,050 cash.
12 Sent a bill to Paramount Trading amounting to P4,000 for accounting services rendered.
14 Received a bill from PLDT for P510 for telephone service to be paid later.
16 Paid P460 to a nearby Petron Services Station for oils and gasoline used on
transportation vehicle (Use Repair and Maintenance).
18 Paid P808 for a new book in Accounting.
20 Received P8,600 cash for accounting services rendered to various clients.
22 Paid P402 for electric and water bill.
24 Paid P110 for office supplies and other petty expenses (Use Miscellaneous Expense).
26 Withdrew P1,000 cash for personal use of Mr. Zalameda.
31 Paid salary of employees P2,200.

NOTE: The beginning balances on July 1 are just account balances of a previous accounting
period and need not be journalized in the two column journal. However, before posting
the current transactions, the beginning balances must be post to their respective
accounts in the ledger. On the first line of the balance side of each account enter the
following: July 1 in the Date column; the word “Balance” in the particular column; a
check mark in the post ref column; the amount in the money column. The check mark
indicates no posting is necessary.

Additional Provision of Accounts: Accounts Receivable…12, Accounts Payable…21,

Zalameda,Drawing…32, Income from Fees…41, Salary Expense…51, Rent Expense…52,
Repair and Maintenance…53, Telephone and Telegram…54, Light and Water
Expense…55, Taxes and License…56, Miscellaneous…57.

REQUIRED: 1. Journalize the above transaction in a two column journal.

2. Using the chart of accounts given below, post the ledger accounts. Foot the ledger
accounts.
3. Cycle of Accounting.
DEMONSTRATION PROBLEM 1 DPT1.1

The trial balance of Irene’s Laundry on June 30 is shown below

IRENE’S COIN LAUNDRY

Trial Balance
June 30, 2007

Account No. Debit Credit

101 Cash 8,750
112 Accounts Receivable 2,320
126 Supplies 1,900
157 Equipment 9,000
201 Accounts Payable 5,500
206 Unearned Revenue 800
301 Irene Bora, Capital 15670
21,970 21,970

The July transactions were as follows:

July 5 Received P850 cash from customers on account.
10 Billed customers for service performed P6,300.
15 Paid employee salaries P1,400.
16 Performed P600 of services for customers who paid in advance in June.
20 Paid P2000 to creditors on account.
21 Received P250 for service rendered on cash basis.
26 Purchased supplies on account, at a cost of P350.
29 Withdrew P600 for personal use.
30 Paid utilities P900.

Additional Information:
Provisions should be made for the following additional accounts: No. 306 Irene Bora, Drawings,
No. 402 Laundry Revenue, No. 726 Salaries Expense, and No. 732 Utilities Expense.

INSTRUCTIONS: Using the sheets provided, submit the following:

DP1.1 Chart of Accounts

DP1.2 July Journal Entries
DP1.3 General Ledger postings for the Month
DP1.4 Trial Balance
DP1.5 Income Statement
DP1.6 Balance Sheet
DP1.7 Post-Closing Trial Balance
DP1.8 Statement of Changes in Owner’s Equity
DP1.9 Cash Flow Statement
DP1.10 Closing Entries
 GRAY ELECTRONICS REPAIR SERVICES

Transaction 1- On Dec. 1, 2014 Mr. Donald Gray started Gray Electronic Repair Services by
investing P10,000.
Transaction 2- On Dec. 5 Gray Electronic Repair Services paid registration and licensing fee for
the business P370.
Transaction 3- On Dec. 6 the company acquired table, chairs, shelves and other fixtures for a
total of P3,000 cash.
Transaction 4- On Dec. 7 the company acquired service equipment for P16,000. The company
paid a 50% down payment and the balance will be paid after 60 Days.
Transaction 5- Also on Dec. 7 Gray Electronic Repair Services purchased service supplies on
account to P1,500.
Transaction 6- On Dec. 9 the company received P1,900 for service rendered.
Transaction 7- On Dec. 12 the company rendered sevices on account P4,250.
Transaction 8- On Dec. 14 Mr Gray invested additional P3,200 in the business.
Transaction 9- Rendered services to a big corporation on Dec. 15, 2014 as per agreement, the
P3,400 amount due will be collected after 30 days.
Transaction 10- On Dec. 22 the company collected from the customer in Transaction 7.
Transaction 11- On Dec, 23 the company paid some of its liabilities in transaction 5 by issuing a
check. The company paid P500 for the P1,500 payable.
Transaction 12- On Dec. 25 the owner withdraw cash P7,000.
Transaction 13- On Dec. 29 the company paid rent P1,500.
Transaction 14- On Dec. 30 the company acquired P12,000 bank loan. The entire amount will be
paid plus 10% interest in one year.
Transaction 15- On Dec. 31 the company paid salaries of the employees P3,500.
 Learning Exercise IV- F
Jounalize the following transactions as given per Learning Exercise III- H
1999
Oct. 1 – M. Oro invests P50,000 in a laundry shop.
2 – Pays for Mayor’s permit and other licenses amounting to P2,000.
3 – Buys books of accounts, invoices, and other forms for P500 cash.
4 – Buys detergents, stain remover, dry cleaning fluid, brooms, brushes and rags
for P8,000 cash.
4 – Buys washing machines from YXL Appliances for P25,000 paying P10,000 with
the balance on account. Estimated useful life of the washing machines is five
(5) years.
8 – Services rendered on charge basis amount to P42,000.
9 – Pays salaries and wages for P30,000.
10 – Pays light and power bills for P7,000.
11 – Services rendered on cash basis amount to P45,000.
15 – Collects P20,000 from customers billed on Oct. 8.
15 – M. Oro withdraws cash of P10,000 from the business.
15 – Water bills amounting to P8,000 are paid.

Use the following account title

11 Cash 21 Accounts Payable

12 Accounts Receivable 31 M. Oro, Capital
13 Washing Machines 32 M. Oro, Drawings
41 Service Income 53 Taxes and License
51 Salaries and Wages 54 Office Supplies
52 Light, Power and Water 55 Shop supplies
IV - JOURNALIZING & POSTING
Illustrative Problem – Sicat Trucking Business

The following transactions were completed by Sicat Tucking Business for March, its
first month of operation.
March 1 Owner Mr. Sicat invested P400,000 cash in the trucking business.
3 Purchased a truck for cash P180,000.
5 Paid rent for the garage and office space, P15,000.
7 Purchased office equipment worth P10,200 from Western Marketing on account.
Terms 30 Days.
9 Paid P1,250 for business license and mayor’s permit.
11 Received P25,000 cash for trucking services.
12 Paid the drivers and employees’ salary, P16,500.
15 Sent a check to Western Marketing P5,000 to apply on account.
17 Paid water and electricity bill, P2,050.
19 Paid gasoline and oils used for the trucks, P12,350.
21 Purchased another truck from Mantrade valued at P200,000. Terms: 50% down,
balance 60 days.
23 Sent a bill to Mercury Drug Co. P38,000 as partial payment of their account.
27 The owner, Mr. Sicat withdrew P13,000 cash from the business for personal use.
31 Paid a mechanic, P950 for minor repairs made on one of the trucks.
Required:
1. Journalize the above transactions in a two column journal.
2. Using the chart of accounts given below, post the transactions to the ledger. Post the
ledger accounts.

Sicat Trucking Business

Chart of Accounts
Acct No.
Assets
Cash…………………………….. 11
Accounts Receivable……. 12
Trucking Equipment…….. 16
Office Equipment…………. 17
Liabilities
Accounts Payable………… 21
Proprietorship
Sicat, Capital……………….. 31
Sicat, Drawing…………….. 32
Acct No.
Revenue Accounts
Service Income………………. 41
Expense Income
Salary Expense………………. 51
Rent Expense………………... 52
Taxes & Licenses……….…… 53
Light & Water Expense….. 54
Gas and Olis used………….. 55
Maintenance & Repair…... 56
II- THE ACCOUNTING EQUATION
Supplementary Problem – Centena Law Office

Atty. Emil Centena opened a Law Office. During the month of August he
completed the following transactions
1. Deposited in a current account P60,000 to be used for the law office as initial
investment.
2. Paid the rent for the office space P1,000.
3. Purchases office furniture and equipment from Automatic Center worth P10,000.
Terms: on account.
4. Purchased various law books from Alemars Bookstore, P20,000 issuing a check
for P5,000 and the balance payable in 30 days.
5. Paid for the newspaper advertisement, P350.
6. Secured the necessary business license and mayor’s permit, P400 cash.
7. Received P15,000 cash as retainer’s fee from various clients.
8. Sent a bill to Wings Manufacturing Co. for legal services rendered, P5,500.
9. Issued a check to Automatic Center, P5,000 to apply on account.
10. Paid for miscellaneous office supplies used during the month P460.
11. Paid the bill for light and water, P580.
12. Withdrew P3,000 cash for personal use.
13. Paid the telephone, telegram services P610.
14. Paid the salary of secretary for the month P2,500.
15. Transferred to the Law Office law books worth P18,000 from his personal library
as additional investment.

Required:
1. A. An expanded equation schedule providing columns for: Cash, Accounts
Receivable, Law Books, Office Furniture and Equipment, Accounts Payable, Net
Capita, Revenues, Expenses and Expense Accounts Title.
B. Proprietorship Accounts Title: Centena, Capital; Centena, Personal; Income
from fees; Salary Expense; Rent Expense; Advertising expense; Taxes and License;
Telephone and Telegram; Light and Water Expense; and Office Supplies Expense.
C. Indicate increase by positive figures, decrease by negative figures (in
parenthesis).
D. Total and rule each money column.
E. Total and rule each element of the accounting equation.
2. Prepare in good form: a. Income Statement for the month ended August 31, 19__
b. Balance Sheet as of August 31, 19__