Financing,

investing and

operating

activities

transaction
Financing
activities
transaction
TRANSACTION 1. BONG STARTED HIS CAR SERVICING BUSINESS BY
PUTTING IN PHP200,000.00 AS HIS INTIAL CAPITAL.

VALUE RECEIVED BY THE BUSINESS VALUE PARTED BY THE BUSINESS

DEBIT CREDIT
CASH PHP200,000.00 BONG, CAPITAL PHP200,000.00
THEREFORE, INVESTMENT BY THE OWNER IS THE SOURCE OF CAPITAL FOR THE
BUSINESS AND THE OWNER. THE FUND MAY BE USED FOR WORKING CAPITAL OR
TO BUY PLANT ASSETS.
 TRANSACTION 2. THE BUSINESS AVAILED FROM A BANK
LOAN AMOUNTING TO 100,000.00, PAYABLE IN THREE
MONTHS, TO SUPPORT ITS WORKING CAPITAL OR TO BUY
PLANTS ASSETS.
VALUE RECEIVED BY THE BUSINESS VALUE PARTED WITH BY THE BUSINESS
DEBIT CREDIT
CASH PHP100,000.00 LOANS PAYABLE PHP100,000.00
THEREFORE, BORROWING FROM THE BANK IS THE SOURCE OF CAPITAL
FOR THE BUSINESS. THE TRANSACTION IS BETWEEN THE BUSINESS AND
THE BANK (LENDER). THE FUND MAY BE USED FOR WORKING CAPITAL
OR TO BUY PLANT ASSETS.
INVESTING
activitY
transaction
 TRANSACTION 3. A SHOP EQUIPMENT WAS PURCHASED BY
THE BUSINESS FOR PHP80,000.00 WITH 30% DOWN PAYMENT
AND THE BALANCE PAYABLE IN TWO MONTHS AFTER THE
INVOIDE DATE.
VALUE RECEIVED BY THE BUSINESS VALUE PARTED WITH BY THE BUSINESS
DEBIT CREDIT
SHOP EQUIPMENT PHP80,000.00 CASH PHP24,000.OO
ACCOUNTS PAYABLE PHP56,000.00
THEREFORE, THE BUSINESS USED CASH TO ACQUIRE A PLANT ASSET –
SHOP EQUIPMENT. THE TRANSACTION IS BETWEEN THE BUSINESS AND
THE SELLER OF THE SHOP EQUIPMENT. THE CASH FUND USED IS DOWN
PAYMENT FOR THE SHOP EQUIPMENT, WHICH IS PHP24,000.00.
OPERATING ACTIVITIES
TRANSACTION
 TRANSACTION 4. THE BUSINESS PAID PHP 1,000.00 FOT THE
MONTHLY WATER BILL
VALUE RECEIVED BY THE BUSINESS VALUE PARTED WITH BY THE BUSINESS
DEBIT CREDIT
Utilities Expense Php1,000.00 Cash Php1,000.00
THEREFORE, THE BUSINESS USED CASH TO SETTLE THE WATER BILL.
THE TRANSACTION IS BETWEEN THE BUSINESS AND THE UTILITIES
PROVIDER.
 TRANSACTION 5. PAYROLL FOR THE MONTH AMOUNTED TO
A GROSS AMOUNT OF PHP 50,000.00, NET PAYROLL WAS PHP
37,500.00, NET OF SSS EMPLOYEES’ SHARE OF PHP 5,500.00,
AND WITHHOLDING INCOME TAX OF PHP 7,000.00.
VALUE RECEIVED BY THE BUSINESS VALUE PARTED WITH BY THE BUSINESS
DEBIT CREDIT
Salary Expense Php50,000.00 Cash Php37,500.00
SSS Premiums Payable Php5,000.00
Withholding Taxes Php7,000.00
Payable
 THEREFORE, THE BUSINESS USED CASH TO PAY THE SALARIES OF
EMPLOYEES. THE TRANSACTION IS BETWEEN THE BUSINESS AND ITS
PERSONNEL. SALARIES ARE BASIC EXPENSES OF THE BUSINESS. THE
DEDUCTION ARE REQUIRED BY THE GOVERNMENT. SSS PREMIUMS
ENTITLE THE EMPLOYEES TO SICKNESS, MATERNITY, AND RETIREMENT
BENEFITS AND ACCESS TO LENDING FACILITIES. WITHHOLDING TAXES
ARE TO BE REMITTED TO THE BIR.
 CRUZ, LARA JOY M.
VALDECANTOS, MIRACLE DL.
GAMALINDA, CHRISTINE JOY V.
MANGAHAS, DARLYN NINA B.
MONCADA, JANINE G.
DIZON, CARYLL I.
PROSPERITY