12

Fundamentals of
Accountancy,
Business and
Management
Quarter 1 – Module 3:
Statement of Comprehensive
Income

SELF-LEARNING MODULE

DIVISION OF GENERAL SANTOS CITY

SELF-LEARNING MODULE

DIVISION OF GENERAL SANTOS CITY

Fundamentals of Accountancy, Business and Management for Grade 12
Self-Learning Module (SLM)
Quarter 1 – Module 3: Statement of Comprehensive Income
First Edition, 2020

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Writers: RENATO F. DOCUSIN
Editors:
Reviewers: Dr. Luzviminda R. Loreno
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 12
Fundamentals of
Accountancy, Business
and Management 2
Quarter 1 – Module 3:
Statement of Comprehensive
Income

SELF-LEARNING MODULE

DIVISION OF GENERAL SANTOS CITY

Introductory Message
For the facilitator:

Welcome to the Fundamentals of Accountancy Business and Management 2 for

Grade 12 Self-Learning Module (SLM) Statement of Comprehensive Income.

This module was collaboratively designed, developed and reviewed by educators

both from public and private institutions to assist you, the teacher or facilitator in
helping the learners meet the standards set by the K to 12 Curriculum while
overcoming their personal, social, and economic constraints in schooling.

This learning resource hopes to engage the learners into guided and independent
learning activities at their own pace and time. Furthermore, this also aims to help
learners acquire the needed 21st century skills while taking into consideration
their needs and circumstances.

In addition to the material in the main text, you will also see this box in the body of
the module:

Notes to the Teacher

This contains helpful tips or strategies
that will help you in guiding the learners.

As a facilitator you are expected to orient the learners on how to use this module.
You also need to keep track of the learners' progress while allowing them to
manage their own learning. Furthermore, you are expected to encourage and assist
the learners as they do the tasks included in the module.
For the learner:

Welcome to the Fundamentals of Accountancy Business and Management 2 for

Grade 12 Self-Learning Module (SLM) Statement of Comprehensive Income.

The hand is one of the most symbolized parts of the human body. It is often used to
depict skill, action and purpose. Through our hands we may learn, create and
accomplish. Hence, the hand in this learning resource signifies that you as a
learner is capable and empowered to successfully achieve the relevant
competencies and skills at your own pace and time. Your academic success lies in
your own hands!

This module was designed to provide you with fun and meaningful opportunities
for guided and independent learning at your own pace and time. You will be
enabled to process the contents of the learning resource while being an active
learner.

This module has the following parts and corresponding icons:

What I Need to Know This will give you an idea of the skills or
competencies you are expected to learn in
the module.

What I Know This part includes an activity that aims to

check what you already know about the
lesson to take. If you get all the answers
correct (100%), you may decide to skip this
module.

What’s In This is a brief drill or review to help you link

the current lesson with the previous one.

What’s New In this portion, the new lesson will be

introduced to you in various ways such as a
story, a song, a poem, a problem opener, an
activity or a situation.

What is It This section provides a brief discussion of

the lesson. This aims to help you discover
and understand new concepts and skills.

What’s More This comprises activities for independent

practice to solidify your understanding and
skills of the topic. You may check the
answers to the exercises using the Answer
Key at the end of the module.

What I Have Learned This includes questions or blank

sentence/paragraph to be filled in to process
what you learned from the lesson.
 What I Can Do This section provides an activity which will
help you transfer your new knowledge or
skill into real life situations or concerns.

Assessment This is a task which aims to evaluate your

level of mastery in achieving the learning
competency.

Additional Activities In this portion, another activity will be given

to you to enrich your knowledge or skill of
the lesson learned. This also tends retention
of learned concepts.

Answer Key This contains answers to all activities in the

module.

At the end of this module you will also find:

References This is a list of all sources used in

developing this module.

The following are some reminders in using this module:

1. Use the module with care. Do not put unnecessary mark/s on any part of
the module. Use a separate sheet of paper in answering the exercises.
2. Don’t forget to answer What I Know before moving on to the other activities
included in the module.
3. Read the instruction carefully before doing each task.
4. Observe honesty and integrity in doing the tasks and checking your
answers.
5. Finish the task at hand before proceeding to the next.
6. Return this module to your teacher/facilitator once you are through with it.
If you encounter any difficulty in answering the tasks in this module, do not
hesitate to consult your teacher or facilitator. Always bear in mind that you are
not alone.

We hope that through this material, you will experience meaningful learning
and gain deep understanding of the relevant competencies. You can do it!
 What I Need to Know

Hello guys! Welcome back to the Fundamentals of Accountancy, Business

and Management 2 as a specialized learning area. We are already done with
identifying the elements of Statement of Comprehensive Income and describe each
of these items for the service business and merchandising business.
In the previous topic, we discussed about the elements, groupings or
classifying account titles in the preparation of presentation of different format of
the Statement of Comprehensive Income for service business and merchandising
business. You are now equipped enough to prepare the said Income Statement.
This time, you are going to apply what you have learned last week.
This Module 3 is dedicated to the topic of Statement of Comprehensive
Income. This time our focus is to prepare a SCI for a service business using the
single-step approach and to prepare a SCI for a merchandising business using the
multi-step approach and at the same time, we will apply the periodic and perpetual
inventory system of the merchandising business. This is in connection with Module
2 which is the application and actual preparation of the said statement.
With you as our inspiration, fun & easy learning cases and practice
problems accompany the discussion of the main topics. So do this with feelings and
dedications to your work. Consider yourself as a bookkeeper or a Certified Public
Accountant. So, enjoy…

In this module, you will prepare a SCI for a service business using the single-
step approach and to prepare a SCI for a merchandising business using the
multi-step approach. ABM_FABM12-Ic-d-5, ABM_FABM12-Ic-d-6

Learning Objectives
At the end of this module, you will be able to:
a. Prepare a Statement of Comprehensive Income for service business using
single-step form
b. Prepare a Statement of Comprehensive Income for merchandising
business using single and multiple-step form
c. Prepare a Statement of Comprehensive Income for merchandising
business using periodic and perpetual inventory system
 What I Know

Hello! In this module, you’re going to learn the preparation of the Statement of
Comprehensive Income. But before that, you are going to answer first the following
questions. Start now.

Let us see what you know about the new topic.

Instruction: You are required to make a Statement of Comprehensive Income for

service business using single-step form and a Statement of Comprehensive Income
for merchandising business using multiple-step form.
Note: use the proper presentation for the said statement. Provide your own
business name and period of operation and also your own records.
Write your answer in a clean long bond paper or any paper available to you.
Your points are 5 for service business and 10 for merchandising business a total of
15 points.

Lesson Statement of Comprehensive

3 Income

In the previous lesson, we learned the elements of Statement of

Comprehensive Income, described each of these items for the service business and
merchandising business, including the classification of the account titles and
practiced the different format for the preparation of the Financial Statement which
is the Statement of Comprehensive Income.

This module, you are required to: 1 prepare a Statement of Comprehensive

Income for service business using single-step form, 2 prepare a Statement of
Comprehensive Income for merchandising business using single and multiple-step
form and 3 prepare a Statement of Comprehensive Income for merchandising
business using periodic and perpetual inventory system. So, here we go….
 What’s In

Let’s review what we have learned!

Let us have a quick review of the previous lessons regarding the topic: Check your
understanding of the following terms.

Can you still remember the following terms?

a. Single-step form

b. Multiple-step form

c. Periodic inventory system

d. Perpetual inventory system

Instruction: Write your answers on the box provided below as you cite them even if
there are wrong answers and differentiate single-step form from multiple-step form
and periodic inventory system from perpetual inventory system. Your points are: 8
points for a and b and 7 points for c and d, a total of 15 points.
 Notes to the Teacher
This contains helpful tips or strategies that will help you in
guiding the learners.

What’s New

Let’s begin our new lesson with activities.

Activity 1: Let’s find out!

What to do:

Instruction: Answer the following questions indicated below the given data.

MABUHAY AUTO REPAIR SHOP

Trial Balance
December 31, 2019

Cash P 3,700
Accounts Receivable 450
Repair Equipment 4,000
Accounts Payable P 1,200
Mabuhay, Drawing 600
Mabuhay, Capital 6,000
Service Income 2,300
Rent Expense 150
Salaries Expense 400
Supplies Expense 200 ________
Balance P 9,500 P 9,500
Questions:
1. What do you think is the result of the operations? Use calculator to get the
result and no need to show computation.
2. What forms of business arises in the problem?
 Write your answers on the box provided below.

Answer

1.

2.

Activity 2: Try me!

Matibay Auto Repair Shop presented the following data for its first month of
operations in March 31, 20A (in pesos)

Salaries Expense 40,000 Advertising Expense 5,000

Depreciation Expense 15,000 Uncollectible Accounts 15,000
Utilities Expense 10,000 Insurance Expense 7,000
Accrued Rent Expense 50,000 Shop Supplies on Hand 2,000
Rent Expense 15,000 Interest Income 1,500
Service Income 120,000 Accrued Interest Income 500

Instruction: Prepare a Statement of Comprehensive Income. Write your answer on

the box provided below
Activity 3: Try me more!

After preparing the work sheet, Matagumpay Merchandising decided to prepare its
Income Statement for the year ended December 31, 2018 (in pesos).These are the
following available data for the report.

Merchandise Inventory, beg. 4,000

Purchases 670,000
Sales Discounts 4,000
Salaries Expense 55,000
Merchandise Inventory, End 105,000
Freight out 4,000
Taxes and Licenses 12,000
Depreciation Expense 12,150
Sales Returns and Allowances 7,000
Freight In 4,000
Purchase Returns and Allowances 6,700
Sales 900,000
Purchase Discounts 3,200
Utilities Expense 16,000
Uncollectible Accounts 19,300
Interest Expense 2,700
Rent Expense 3,000

Instruction: Based on the data given above, prepare the said Statement using
Perpetual Inventory System and Periodic Inventory System. Write your answer on
the box provided below.
Activity 4: Do it for me!

The following accounts shown in the Ledger of Hayahay Talaga Service for the
month of December 31, 2018 (in pesos) are as follows.

Service Revenue 170,000

Interest Income 14,500
Utilities Expense 6,500
Office Supplies 4,000
Salaries Expense 25,000
Transportation Expense 10,000
Depreciation Expense- Building 12,000
Depreciation Expense- Equipment 25,000

Instruction: Prepare a single-step form Statement of Comprehensive Income. Write

your answer on the box provided below.
 What is It

You’ve just shared your personal thoughts, knowledge and experiences with the
recent activity. At this juncture you are now ready to explore the Statement of
Comprehensive Income which is to prepare a Statement of Comprehensive Income
for service business using single-step form, prepare a Statement of Comprehensive
Income for merchandising business using single and multiple-step form and to
prepare a Statement of Comprehensive Income for merchandising business using
periodic and perpetual inventory system. Let’s discuss the different activities

In Activity number 1, The Mabuhay Auto Repair Shop generates a Net

Income/Profit for the month of P 1,550 and the service business is the form of
business being utilized.
In Activity number 2, As we can see the result below is the proper presentation
with the name of the business, name of the report, and the period covered and it
follows the elements of Income Statement which are the Income and Expenses and
generates a Net Income of P11,500. The service business used the Single-step form.
In addition, the natural method of expenses was used.

In Activity number 3, In the first Statement, we can see again the result below is
the proper presentation with the name of the business, name of the report and the
period covered and it follows the elements of Income Statement which are the
Revenue, Cost of goods Sold and Expenses and generates a Net Income of P203,350
and it is obviously, multiple-step form used by the merchandising business. In
addition, functional method of expenses was used and it is under the periodic
inventory system. The Net Income/Profit for the month is P203,350

The second statement, same heading, elements, same result of Net Income and
same multiple-step form used by the business but natural method of expenses
was used and it is under the perpetual inventory system. Net Income/Profit for
the month is P 203,350

In Activity number 4, The business generates a Net Income of P 106,000.

What’s More

Congratulations! You have just finished your activities given to you, Now, we will
have another activities that may help you understand and develop skills about the
topic.

Let’s try this.

Activity 5: Compute me!

These are the following data (in pesos).

Freight In 4,000
Purchases 570,000
Purchase Returns and Allowances 8,500
Merchandise Inventory, March 1 -0-
Merchandise Inventory, March 31 450,000
Purchase Discounts 7,000
Instruction: Compute what is asked? Write your answers on the box provided for.
Show your solution.

1. How much is the Cost of Goods Available for sale?

2. How much is the Cost of Goods Sold?

Activity 6: Let’s compute this!

Sales Returns and allowances 4,000

Sales 20,000
Sales Discounts 5,500

Instruction: If you are going to compute the given data, what will be the result
among the three account titles? (in pesos). Write your answer on the box provided
below. Show your solution.
Activity 7: Let’s compute this!
If Matatag Company Sales amounted to P 500,000, Beginning Inventory totaled
P 250,000, Ending Inventory amounted to P 50,000 while Net Cost of Purchases
totaled P 85,000.
Instruction: Compute the Cost of Goods Sold. Write your answer on the box
provided below. Show your solution.

Activity 8: Let’s compute this!

Purchases 54,200
Purchase Discounts 396
Purchase Returns & Allowances 500
Freight-In 500
Merchandise Inventory, End 25,304
Merchandise Inventory, Beg -0-

Instruction: Compute the following questions: (in pesos).Write your

answer on the box provided below. Show your solution.

1. How much is the Net Purchases?

2. How much is the Cost of Goods Available for Sale?
3. How much is the Cost of Goods Delivered?
Activity 9: Let’s do this!

Online Just Marketing presented the following operating expenses for the month.(in
pesos)

Salaries-Selling 10,000 Depreciation Expense 2,000

Freight Out 2,000 Utilities Expense 500
Advertising Expense 3,000 Uncollectible Account Expense 1,000
Taxes and Licenses 1,500 Rent Expense 1,500

Instruction: Compute the following questions.

1. How much is the Selling or Distribution Expenses?
2. How much is the General and Administrative Expenses?
Write your answers on the box provided below. Show your solution.

What I Have Learned

Let’s sum it up!

Now that you have learned a lot from our module, let’s summarize our lesson from
the very start.

Activity 10: Let’s face it!

Part 1

Instruction: Identify the correct answer of the following statement. Write your
answer on the blank space provided after the number.

1. _______________________Separates cost of goods sold from operating

expenses.
2. _______________________Combines all revenues into one category.
3. ________________________Form to be used in service concern or
merchandising business under “perpetual inventory system.
4. __________________ Form to be used in merchandising business under
periodic inventory system”.

5. Write the heading, the ____________________and the date covered. (for the
period ended.) are the Steps in preparing the Statement of Comprehensive
Income of a service business and merchandising business:

Part 2

Instruction: Write TRUE if the statement is correct and FALSE if the statement is
wrong. Write your answer before the number.

_________ 6. In the multiple step-form of Statement of Comprehensive Income

preparation, operating expenses are directly deducted from Sales to
arrive at a Profit.
_________ 7. The normal balance of Revenue or Income account is credit and
Expense is debit.
___________8.Statement of Comprehensive Income accounts are also called
“temporary accounts”
_________ _9. Profit and loss are closed to Owner’s Equity.
__________10.The Statement of Comprehensive Income tells us whether the
business makes profit or incur a loss.

What I Can Do

Now, it’s about time for us to use our knowledge on the preparation of the
Statement of Comprehensive Income for service business and merchandising
business using single-step, multiple-step form under the periodic and perpetual
inventory system.
Let’s do it!
Activity 11 Think about this!
Situation 1
You are engaged in buying and selling business and incurred a loss of P 10,000 for
the first month of operations.

Answer the following questions. Write your answer on the space provided below.

1. What do you think is the reason why your business incurred a loss? What is
your proof?

__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________

2. What do you think is the best solution to avoid a loss?

___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________
___________________________________________________________________________

Situation 2
If you are the Bookkeeper of Lyn Marketing and the manager instructed you to
make a Statement of Comprehensive Income but there were no Purchases,
Purchase Returns & Allowances and Purchase Discounts in the chart of Accounts.
Question:
Can you prepare the said Statement? what specific inventory system you should
use?. Write your answer on the space provided below.

__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________

Assessment

Hi! Now that you have learned about the preparation of Statement of
Comprehensive Income, let us test your knowledge and understanding of what we
have discussed.

Let’s find out!

 The following General Ledger account balances of Masikap Merchandising
after adjustment are given.(in pesos).

Sales 42,000
Sales Discounts 240
Sales Returns and Allowances 800
Merchandise Inventory, March 1 20,000
Purchases 54,200
Purchase Discounts 396
Purchase Returns and Allowances 500
Freight In 500
Merchandise Inventory, March 31 25,304
Salaries Expense 2,000
Freight Out 200
Advertising Expense 1,000
Rent Expense 800
Utilities Expense 600

Instruction: Encircle the letter of the correct answer. Show your solution according
to the elements of Statement of Comprehensive Income. Write your solution in a
clean long bond paper or any paper available to you and attach it to the module.

Problem 1
1. How much is the total of the debit column?
a. 40,960 c. 35,292
b. 55,596 d. 80,340.

2. How much is the total of the credit column?

a. 68,200 c. 68, 800
b. 62,896 d. 62,396

3. How much is the gross profit?

a. 1,068 c. 5,168
b. 5,668 d. 6,168

4. How much is the profit?

a. 6,168 c. 5,168
b. 5,668 d. 1,068

5. How much is the total expenses?

a. 5,000 c. 4,600
b. 6,500 d. 5,300

6. How much is the Cost of Goods Sold?

a. 60,596 c. 55,096
b. 35,292 d. 34,792

7. How much is the Net Sales?

a. 42,000 c. 41,200
 b. 41,760 d. 40,960

8. How much is the Net Purchases?

a. 54,200 c. 55,596
b. 55,096 d. 60,596

9. How much is the Cost of Goods Available for Sale?

a. 54,200 c. 55,096
b. 60,596 d. 55,596

10. How much is the Delivered Cost of Purchases?

a. 54,200 c. 55,596
b. 60,596 d. 55,096

11. How much is the Selling or Distribution Expenses

a. 1,400 c. 4,600
b. 3,200 d. 5,668

Problem 2

The following General Ledger account balances of Matatag Company after

adjustment are given.(in pesos)

Instruction:. Encircle the letter of the correct answer. Write your solution in a clean
long bond paper or any paper available to you and attach it to the module.

Accrued Interest Income 18,500

Service Revenue 170,000
Transportation Expense 10,000
Salaries Expense 25,000
Accrued Salaries Expense 12,000
Accumulated Depreciation-Equipment 50,000
Accumulated Depreciation-Building 18,000
Depreciation Expense- Building 12,000
Depreciation Expense- Equipment 25,000
Utilities Expense 6,500
Transportation Equipment 110,000
Interest Income 14,500

12. How much is the total expenses?

a. 184,500 c. 106,000
b. 170,000 d. 78,500

13. How much is the total Income?

a. 184,500 c. 106,000
b. 170,000 d. 78,500

14. How much is the Net Income?

a. 184,500 c. 106,000
b. 170,000 d. 78,500
 15. How much is the total amount not included in the Statement of
Comprehensive Income?
a. 184,500 c. 106,000
b. 108,000 d. 78,500

Additional Activities

Congratulations! You made it until the end of our lesson. I know you’ve
learned so much about the preparation of a Statement of Comprehensive Income
for a service business using single-step form, preparation of a Statement of
Comprehensive Income for merchandising business using single and multiple-step
form and the preparation of a Statement of Comprehensive Income for
merchandising business using periodic and perpetual inventory system

Let’s do this. This is an additional 10 points.

These activities can help you improve your knowledge and skills in the preparation
of the Statement of Comprehensive Income in a service business and
merchandising business.
Read the problem carefully.
1. At the end of the first month of operations for Masipag’s Delivery Service, the
business had the following accounts: Service revenue, Php.26,900; Prepaid
Rent Income, Php.9,600; Unearned income, Php.10,,200 and Accrued
income Php9,650. On the same date, Matsipag incurred the following
expenses: Wages expense, Php16, 300; Utilities expense, Php 4, 500.

Instruction: Prepare a Statement of Comprehensive Income.(single-step form) Write

your answer on the box provided below.
Activity 2
Solution:
ABM Auto Repair Shop
Statement of Comprehensive Income
For the month ended March 31, 20A
Service Income P 120,000
Interest Income 1,500
Total Income 118,500
Less: Expenses
Salaries Expense P 40,000
Advertising Expense 5,000
Depreciation Expense 15,000
Uncollectible Accounts 15,000
Utilities Expense 10,000
Insurance Expense 7,000
Rent Expense 15,000 107,000
Net Income P 11,500
What’s New
Activity 1
1. Solution:
Service Income P 2,300
Less: Expenses
Rent Expense P 150
Salaries Expense 400
Supplies Expense 200 750
Net Income P 1,550
2 service business
Activity 3
Solution: Periodic inventory system (function method)
GENSAN MERCHANDISER
Statement of Comprehensive Income
For the month ended March 31, 20B
Sales P 900,000
Less: Sales Discounts P 3,200
Sales Returns and Allowances 7,000 10,200
Net Sales 889,800
Cost of Goods Sold:
Merchandise Inventory, March 1 P 4,000
Purchases P 670,000
Less: Purchase Discounts P4,000
Purchase Returns and Allowances 6,700 10,700
Net Purchases 659,300
Add: Freight In 4,000
Delivered Cost of Purchases 663,300
Cost of Goods Available for Sale 667,300
Less: Merchandise Inventory, March 31 105,000
Cost of Goods Sold 562,300
Gross Profit 327,500
Less: Operating Expenses
Selling or Distribution
Salaries Expense 55,000
Freight Out 4,000
Uncollectible Accounts 19,300
Taxes and Licenses 12,000 90,300
General and Administrative:
Rent Expense 3,000
Depreciation Expense 12,150
Utilities Expense 16,000 31,150 121,450
Profit before Finance Charges 206,050
Less: Interest Expense 2,700
Profit for the month P 203,350
Activity 4
Single-step form
Hayahay Service
Statement of Comprehensive Income
For the month ended December 31, 2018
Service Revenue P 170,000
Interest Income 14,500
Total Income 184,500
Less: Expenses
Salaries Expense 25,000
Transportation Expense 10,000
Depreciation Expense- Building 12,000
Depreciation Expense- Equipment 25,000
Utilities Expense 6,500 78,500
Net income P 106,000
Solution: Perpetual inventory system (nature method)
Char Supermarket
Statement of Comprehensive Income
For the month ended March 31, 20B
Net Sales P 889,800
Less: Cost of Goods Sold 562,300
Gross Profit 327,500
Less: Operating Expenses
Salaries Expense P 55,000
Freight- Out 4,000
Uncollectible Accounts 19,300
Taxes and Licenses 12,000
Rent Expense 3,000
Depreciation Expense 12,150
Utilities Expense 16,000 121,450
Profit before Finance Charges 206,050
Less: Interest Expense 2,700
Net Income/Profit for the month P 203,350
Activity 6
Sales P 20,000
Less: Sales Returns & Allowances P 4,000
Sales Discounts 5,500 9,500
Net Sales P 10,500
Activity 7
Solution.
Sales P 500,000
Merchandise Inventory, beg. P 250,000
Net Cost of Purchases 85,000
Cost of Goods Available for Sale 335,000
Cost of Goods Sold P 165,000
Activity 8
Solution.
Merchandise Inventory, Beg P -0-
Purchases P 54,200
Purchase Returns & Allowances P 500
Purchase Discounts 396 896
Net Purchases 53,304
Add. Freight-In 500
Delivered Cost of Purchases 53,804
Cost of Goods Available for Sale 53,804
Merchandise Inventory, End 25,304
Cost of Goods Sold P 28,504
53,804 1
1 P53,304
2 53,804
3 53,804
Activity 9
Selling or Distribution General and Administrative
Salaries-Selling P 10,000 Depreciation Expense P 2,000
Uncollectible Account Expense 1,000 Utilities Expense 500
Freight Out 2,000 Rent Expense 1,500
Advertising Expense 3,000 Total P 4,000
Taxes and Licenses 1,500
Total P 17,500
What I have learned
Assessment
Activity 10
Part 1
1 multiple-step form 1 d
2 single-step form 2 a
3 single- step form 3 b
4 multiple-step form 4 d
5 title of the report 5 c
Part 2 6 b
6 FALSE 7 d
7 TRUE 8 b
8 TRUE 9 b
9 TRUE 10 c
10 TRUE 11 b
12 d
13 a
14 c
15 b
Assessment
Solution: problem 1
Sales 42,000
Sales Discounts 240
Sales Returns and Allowances 800
Merchandise Inventory, March 1 20,000
Purchases 54,200
Purchase Discounts 396
Purchase Returns and Allowances 500
Freight In 500
Merchandise Inventory, March 31 25,304
Salaries Expense 2,000
Freight Out 200
Advertising Expense 1,000
Rent Expense 800
Utilities Expense 600 _______
Totals 80340 68,200
 Solution: problem 2
Service Revenue P 170,000
Interest Income 14,500
Total Income 184,500
Less: Expenses
Salaries Expense 25,000
Transportation Expense 10,000
Depreciation Expense- Building 12,000
Depreciation Expense- Equipment 25,000
Utilities Expense 6,500 78,500
Net income P 106,000
Accrued Interest Income 18,500
Accrued Salaries Expense 12,000
Accumulated Depreciation-Equipment 50,000
Accumulated Depreciation-Building 18,000
Transportation Equipment 110,000
Total 208,000
Sales P 42,000
Less: Sales Discounts P 240
Sales Returns and Allowances 800 1,040
Net Sales P 40,960
Cost of Goods Sold:
Merchandise Inventory, March 1 P 5,000
Purchases P 54,200
Less: Purchase Discounts P396
Purchase Returns and Allowances 500 896
Net Purchases 55,096
Add: Freight In 500
Delivered Cost of Purchases 55,596
Cost of Goods Available for Sale 60,596
Less: Merchandise Inventory, March 31 25,304
Cost of Goods Sold 35,292
Gross Profit 5,668
Less: Operating Expenses
Selling or Distribution
Salaries Expense 2,000
Freight Out 200
Advertising Expense 1,000 3,200
General and Administrative:
Rent Expense 800
Utilities Expense 600 1,400 4,600
Profit for the month P 1,068
References

Fundamental of Accountancy, Business and Management (For Senior High School Students) Under
the K to 12 Business Education Curriculum for Accountancy Business and Management(ABM)
Specialized Subject (Outcome –Based Education)by Rafael M. Lopez, JR.
(Haddock, Price, & Farina, 2012)

https://www.google.com/search?sxsrf=ALeKk01G8VoHj9W1ajyJEA7GMNuBx0v4XQ%3A1593085502
417&ei=Po70XvnVGNuB-QaQ1rYo&q=perpetual+inventory+system
 DISCLAIMER
This Self-learning Module (SLM) was developed by DepEd – Division of
General Santos City with the primary objective of preparing for and
addressing the new normal. Contents of this module were based on DepEd’s
Most Essential Learning Competencies (MELC). This is a supplementary
material to be used by all learners in General Santos City in all public
schools beginning SY 2020-2021. The process of LR development was
observed in the production of this module. This is version 1.0. We highly
encourage feedback, comments, and recommendations.

For inquiries or feedback, please write or call:

Department of Education – Division of General Santos City

Learning Resource Management System (LRMS)

Tiongson St., Lagao, General Santos City

Telefax No.: (083) 552-8909

Email Address: depedgensan@deped.gov.ph